EXHIBIT 10.12
CERTAIN PORTIONS OF THIS DOCUMENT FOR WHICH CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED HAVE BEEN REDACTED. REDACTIONS ARE
INDICATED BY A DOUBLE PAIR OF EMPTY BRACKETS ("[[ ]]").
ASSET PURCHASE AND
SALE AGREEMENT
By and Between
FUTURESOUTH, INC., SOUTHBOAT ▇▇▇▇▇, INC.
and SOUTHBOAT LIMITED PARTNERSHIP,
Seller,
and
AMERISTAR CASINO ST. LOUIS, INC.
Buyer.
Dated as of February 15, 2000
1. Definitions; Construction. 1
1.1 Definitions 1
1.2 Construction 10
2. Assets, Assumed Contracts and Assumed Liabilities. 10
2.1 Assets 10
2.1.1 Lease 10
2.1.2 Project Documents 10
2.2 Assumed Contracts and Liabilities 10
2.3 Assumption of Liabilities 11
3. Purchase Price. 11
3.1 Purchase Price for the Assets. 11
3.1.1 Purchase Price 11
3.1.2 Royalty Payment 11
3.1.3 Sale of Project/Foreclosure 12
3.1.4 No Interest in Project 12
3.1.5 Delivery of Financial Statements 13
4. Closing; Conditions to Closing. 13
4.1 Closing 13
4.2 Seller's Conditions 13
4.3 Buyer's Conditions 14
5. Representations and Warranties of Seller 17
5.1 General Representations and Warranties. 17
5.1.1 Organization 17
5.1.2 Ownership 18
5.1.3 Authorization 18
5.1.4 Subsidiaries and Partnerships 18
5.1.5 No Conflict or Violation 18
5.1.6 No Burdensome Restrictions 19
5.1.7 Litigation and Proceedings 19
5.1.8 Consents and Approvals 19
5.1.9 Disclosures 19
5.2 Representations and Warranties With Respect to the Assets. 19
5.2.1 Title to Assets 20
5.2.2 Leased Site 20
5.2.3 Project Documents 20
5.2.4 Other Assets 20
5.3 Representations and Warranties With Respect to the
Liabilities of Seller. 20
5.3.1 Debts 20
5.3.2 Environmental Matters 20
5.3.3 Insurance 20
5.4 Representations and Warranties With Respect to the
Operations of Seller. 20
5.4.1 Compliance with Laws 21
5.4.2 Condemnation, Eminent Domain, Rezoning and Leasing 21
5.4.3 Improper Payments 21
5.5 Representations and Warranties With Respect to Seller's
Disclosures. 21
5.5.1 Material Omissions 21
5.5.2 Brokers 21
5.5.3 Project Documents 21
6. Representations and Warranties of Buyer 22
6.1 Organization 22
6.2 Authorization 22
6.3 No Conflict or Violation 22
6.4 Litigation and Proceedings 22
6.5 Consents and Approvals 23
6.6 Brokers 23
6.7 No Licensing Problems 23
6.8 Ownership 23
6.9 Financial Statements of ACI 23
7. Affirmative Covenants 23
7.1 Permits 23
7.2 Governmental Investigation 24
7.3 Notices 25
7.4 Contracts 25
7.5 Other Prohibited Transactions 25
7.6 Inspection 25
7.7 Contacts 26
7.8 Condemnation 26
7.9 Project Documents 26
7.10 Improper Payments 26
7.11 Exclusivity 26
7.12 Right of Setoff 27
7.13 Showboat Development Company 27
7.14 Lease Obligations 27
7.15 Information 27
7.16 VIP Privileges 28
7.17 Transfers of Stock of Seller 28
8. Abandonment of Project 29
9. Alternate Site 30
10. Termination; Default. 31
10.1 Termination and Abandonment 31
10.2 Effect of Termination 31
10.3 Default by Seller 31
10.4 Default by Buyer 31
10.5 Notice and Cure Rights 31
11. Indemnification. 31
11.1 Seller 31
11.2 Buyer 32
11.3 Third Person Claims 32
11.4 Indemnification Payments 33
11.5 Limitations 33
11.5.1 On Buyer 33
11.5.2 On Seller 33
12. No Assurances 33
13. General Provisions. 34
13.1 Accounting Terms 34
13.2 Amendment and Modification 34
13.3 Approvals and Consents 34
13.4 Assignments 34
13.5 Business Day 34
13.6 Captions 34
13.7 Confidentiality 34
13.8 Counterpart Facsimile Execution 35
13.9 Counterparts 35
13.10 Entire Agreement 35
13.11 Exhibits 35
13.12 Failure or Delay 35
13.13 Further Assurances 35
13.14 Governing Law 36
13.15 Legal Fees, Costs 36
13.16 Notices 36
13.17 Publicity 37
13.18 Schedules 37
13.19 Severability 37
13.20 Specific Performance and Injunctive Relief 37
13.21 Submission to Jurisdiction 38
13.22 Successors and Assigns 38
13.23 Third-Party Beneficiary 38
13.24 Signature Warranty 38
13.25 Survival 38
14. Arbitration. 39
14.1 Arbitration Proceedings 39
14.2 Limitation on Consolidation or Joinder 39
INDEX OF EXHIBITS
EXHIBIT DESCRIPTION
EXHIBIT A Legal Description of the Leased Site
EXHIBIT B Assignment and Assumption Agreement
EXHIBIT C ▇▇▇▇ of Sale
EXHIBIT D Lease
EXHIBIT E Management Agreement
EXHIBIT F Project Documents
EXHIBIT G Promissory Note
EXHIBIT H Collateral Assignment of Lease
EXHIBIT I Security Agreement
EXHIBIT J Opinion of Buyer's Legal Counsel
EXHIBIT K Opinion of Seller's Legal Counsel
EXHIBIT L Certificate of Futuresouth Shareholders
INDEX OF DISCLOSURE SCHEDULES
SCHEDULE DESCRIPTION
5.1.1. Names
5.1.2. Stock Ownership
5.1.4. Seller's Subsidiaries and Partnerships
5.1.7. Litigation and Proceedings
5.1.8. Consents and Approvals Required of Seller
5.3.1. Seller's Debt
5.4.1. Compliance with Laws
5.4.3. Improper Payments
6.5. Consents and Approvals Required of Buyer
ASSET PURCHASE AND SALE AGREEMENT
This Asset Purchase and Sale Agreement is made and entered
into as of the 15th day of February, 2000 among Ameristar Casino
St. Louis, Inc., a Missouri corporation ("Buyer"), Futuresouth,
Inc., a Missouri corporation (herein "Futuresouth"), Southboat
▇▇▇▇▇, Inc., a Nevada corporation (herein "Southboat") and
Southboat Limited Partnership, a Missouri limited partnership
(herein "SLP") (Futuresouth, Southboat and SLP are herein
collectively referred to as "Seller").
RECITALS
A. Futuresouth is the sole shareholder of Southboat.
Southboat is the sole general partner and Futuresouth is the sole
limited partner of SLP.
B. SLP holds a leasehold interest in an undeveloped site
in St. Louis County, Missouri pursuant to that certain Amended
and Restated Lease and Development Agreement by and between SLP,
as tenant, and St. Louis County Port Authority, as landlord,
dated as of February 15, 2000. A legal description of the leased
site is set forth in Exhibit A and by this reference made a part
hereof .
C. Buyer wishes to purchase, and Seller wishes to sell,
the Lease and the Project Documents (as hereinafter defined) upon
the terms set forth herein.
AGREEMENT
In consideration of the foregoing, the mutual covenants
herein contained and other good and valuable consideration (the
receipt, adequacy and sufficiency of which are hereby
acknowledged by the Parties by their execution hereof), the
Parties agree as follows:
1. Definitions; Construction.
1.1 Definitions. For purposes of this Agreement, unless the
context clearly indicates otherwise, the following capitalized
terms have the following meanings:
"ACI" means Ameristar Casinos, Inc., a Nevada
corporation; the parent company of Buyer.
"Affiliate" of any specified Person means: (i) any
other Person, directly or indirectly, controlling or controlled
by or under direct or indirect common control with such specified
Person; (ii) any other Person who is a director or officer (a) of
such specified Person, (b) of any subsidiary of such specified
Person or (c) of any Person described in clause (i) above; or
(iii) any partner (general or limited), trustee, beneficiary,
spouse, child (including an adult child) or sibling of, or member
in a limited liability company with, any Person described in
clause (i) above. For the purposes of this definition, "control"
when used with respect to any Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities,
by contract or otherwise, and it shall be conclusively presumed
that the beneficial ownership of 25% or more of the securities
having ordinary voting power for the election of directors (or
comparable positions) of such Person constitutes control; and the
term "controlling" and "controlled" have meanings correlative to
the foregoing.
"Agreement" means this Asset Purchase and Sale
Agreement, including all Exhibits and Schedules hereto.
"Applicable Law" means any law, rule, regulation,
order, decree or other requirement having the force of law and,
where applicable, any interpretation thereof by any authority
having jurisdiction with respect thereto or charged with the
administration thereof.
"Assets" means the Lease and the Project
Documents.
"Assignment and Assumption Agreement" means that
assignment and assumption agreement to be entered into between
Buyer and Seller on the Closing Date, in the form of Exhibit B,
whereby Seller assigns all of its rights under the Lease to Buyer
and Buyer assumes Seller's obligations under the Lease on the
terms set forth therein.
"Basket Amount" means $25,000.00.
"▇▇▇▇ of Sale" means that ▇▇▇▇ of sale to be
executed and delivered by Seller to Buyer on the Closing Date, in
the form of Exhibit C, whereby Seller conveys the Project
Documents to Buyer.
"Business Day" means a day other than a Saturday,
Sunday or other day on which commercial banks are authorized or
required to close under the laws of the United States of America
or the State of Missouri.
"Buyer" has the meaning set forth in the opening
paragraph of this Agreement.
"Capital Expenditure" means all expenditures
(excluding interest capitalized during construction) which must
be capitalized under GAAP.
"Capitalized Lease Obligation" means the
obligations of a lessee under any lease of property which must be
capitalized under GAAP.
"Closing" has the meaning set forth in Section
4.1.
"Closing Date" has the meaning set forth in
Section 4.1.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Commencement of Construction" means the first
turning of the ground in connection with the actual construction
of the Project, excluding any ceremonial ground-breaking.
"Confidential Information" means: (i) information
not available to the general public or not in the public domain
concerning Buyer's business and financial affairs delivered by or
on behalf of Buyer to Seller; (ii) information not available to
the general public concerning Seller's business and financial
affairs (including, but not limited to, the information
respecting the shareholders and partners of Seller) delivered by
or on behalf of Seller to Buyer; and (iii) analyses,
compilations, forecasts, studies and other documents prepared on
the basis of such information prepared by the Parties or their
respective agents, representatives, Affiliates, employees or
consultants.
"Contingent Obligation" means, as to any Person:
(i) any direct or indirect liability, contingent or otherwise, of
such Person with respect to any Debt or Contractual Obligation of
another Person if the purpose or intent of such Person in
incurring the Contingent Obligation is to provide assurance to
the obligees of such Debt or Contractual Obligation that such
Debt or Contractual Obligation will be paid or discharged, that
any agreement relating thereto will be complied with or that any
holder of such Debt or Contractual Obligation will be protected
(in whole or in part) against loss in respect thereof, and (ii)
any contingent liability as determined in accordance with GAAP
(without regard to materiality).
"Contractual Obligation" means any obligation,
agreement or undertaking, whether oral or written and includes,
without limitation, the Lease.
"CPI" means the Consumer Price Index for All Urban
Consumers for the U.S. City Average for All Items 1982-84=100, as
determined by the United States Department of Labor, Bureau of
Labor Statistics.
"Debt" of a Person means (i) all obligations of
such Person for borrowed money; (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar
instruments; (iii) all obligations of such Person to pay the
deferred purchase price of property or services; (iv) all
Capitalized Lease Obligations of such Person; (v) all obligations
or liabilities of others secured by an Encumbrance on any asset
owned by such Person, whether or not such obligation or liability
is assumed by such Person; (vi) all Contingent Obligations of
such Person; and (vii) all other obligations or liabilities of
such Person which are required by GAAP (without regard to
materiality) to be shown as a liability or otherwise disclosed in
financial statements.
"Development Costs" means all Capital Expenditures
of the Project, as made from time to time, excluding Maintenance
Capital Expenditures to the extent funded or deemed to be funded
out of the Maintenance Capital Expenditures Reserve.
"Disclosing Party" has the meaning set forth in
Section 13.7.
"Disclosure Schedule" means those schedule(s)
which sets forth all exceptions to Seller's representations and
warranties contained in Section 5.
"$" means United States of America dollars.
"Encumbrance" means any mortgage, deed of trust,
pledge, hypothecation, assignment, deposit arrangement,
restriction (including any easement, right-of-way or similar
restriction), condition, lease, lien (statutory or otherwise),
security interest, any conditional sale or option contract or
other title retention agreement.
"Environmental Damages" means all losses,
penalties, fines, liabilities (including strict liability), costs
and expenses, including reasonable attorneys' fees and
consultants' fees, any of which are incurred at any time as a
result of the existence of Hazardous Material at, upon, about or
beneath the Leased Site, adjoining or nearby property or a
Hazardous Waste Site or migrating or threatening to migrate to or
from the Leased Site or a Hazardous Waste Site, or the existence
of a violation of Environmental Laws pertaining to the Leased
Site or a Hazardous Waste Site, including: (i) damages for
personal injury, or injury to property or natural resource
occurring upon or off the Leased Site or a Hazardous Waste Site,
foreseeable or unforeseeable, including lost profits,
consequential damages, interest and penalties, and (ii) damages
for the loss of the use or any adverse impact on the marketing or
marketability of rentable space on the Leased Site.
"Environmental Laws" means all Applicable Laws
relating to the environment, including: (i) all requirements
pertaining to reporting, licensing, permitting, investigation and
remediation of emissions, discharges, releases or threatened
releases of Hazardous Material, whether solid, liquid or gaseous
in nature, into the air, surface water, groundwater or land, (ii)
all requirements relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Material, whether solid, liquid or gaseous
in nature; and (iii) all requirements pertaining to the
protection of the health and safety of employees or the public.
"Excess Unexpended Maintenance Capital
Expenditures Reserves" means that amount of the Maintenance
Capital Expenditures Reserve funded or deemed to be funded in
respect of any Fiscal Year that is not expended or deemed to be
expended within two (2) years after the end of such Fiscal Year
in respect of which such amount was reserved. For purposes of
this definition, all disbursements funded or deemed to be funded
out of the Maintenance Capital Expenditures Reserve shall be
deemed to be made on a first-in, first-out (FIFO) basis of
accounting.
"Excursion Gambling Boat" means a casino gambling
facility licensed in accordance with Applicable Law.
"Financial Statements" means the financial
statements of Buyer and, if Buyer engages in activities other
than the Project or activities incidental thereto, of the Project
for the applicable period, audited by a national accounting firm,
containing a balance sheet, statements of income and expense and
of cash flow, prepared in accordance with GAAP on a consistent
basis, and includes all notes thereto.
"Fiscal Year" means the 12-month period designated
by the Buyer as its fiscal year for tax purposes.
"GAAP" means generally accepted accounting
principles from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board.
"Governmental Authority" means any government of
any nation, state or other political subdivision thereof and any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Hazardous Materials" means any substance: (i) the
presence of which requires investigation or remediation under any
Environmental Law; (ii) which is or becomes defined as a
"hazardous waste" or "hazardous substance" under any
Environmental Law; (iii) which is toxic, explosive, corrosive,
flammable, infectious, radioactive, carcinogenic, mutagenic or
otherwise hazardous and is or becomes regulated by any
Governmental Authority; (iv) the presence of which causes or
threatens to cause a nuisance or poses or threatens to pose a
hazard to property or to the health or safety of Persons; (v)
which contains gasoline, diesel fuel or other petroleum
hydrocarbons; or (vi) which contains polychlorinated biphenyls or
asbestos.
"Hazardous Waste Site" means any site or location,
wherever located (including any well, pit, pond, lagoon, tailings
pile, spoil pile, impoundment, ditch, trench, drain, landfill,
warehouse or waste storage container) where Hazardous Material
has been deposited, stored, treated, reclaimed, disposed of,
placed or otherwise come to be located.
"Indemnified Party" means any Person claiming a
right to indemnification pursuant to any indemnification
provision in this Agreement.
"Indemnifying Party" means any Person obligated to
indemnify another Person pursuant to any indemnification
provision in this Agreement.
"Landlord" means St. Louis County Port Authority,
a public body corporate and politic of the State of Missouri.
"Lease" means that certain Amended and Restated
Lease and Development Agreement by and between SLP and the St.
Louis County Port Authority dated as of February 15, 2000, a copy
of which is attached hereto as Exhibit D, any and all future
amendments thereto permitted hereunder prior to the Closing Date
and the leasehold estate created thereunder.
"Leased Site" means that real property and any
appurtenances thereto located in St. Louis County, Missouri
containing approximately twenty-nine (29) acres all as set forth
and legally described in Exhibit A.
"Lender" means a Person who lends money to Buyer
and/or ACI in connection with the Project in an arms' length
transaction.
"Maintenance Capital Expenditures" means those
Capital Expenditures of Buyer made for the purpose of replacing
or renovating then existing assets and/or components of the
Project, including but not limited to slot machine and other
gaming equipment replacements, restaurant renovations, casino
signage renovation or replacement, hotel room renovations and
replacements and other furniture, fixture and equipment
renovations and replacements.
"Maintenance Capital Expenditures Reserve" means
an unsegregated reserve account for Maintenance Capital
Expenditures to be funded or deemed funded annually from and
after the Opening Date. The initial annual funding rate shall be
equal to 3.5% of the total Development Costs on a weighted
average during the Fiscal Year in question. If the Opening Date
occurs on a date other than the first day of a Fiscal Year, the
amount to be funded or deemed funded shall be prorated for such
Fiscal Year. Commencing with the second full Fiscal Year
following the Opening Date, the annual funding rate shall be
increased annually, in the sole discretion of Buyer, to a
percentage not to exceed the prior year annual rate multiplied by
the increase, if any, in the CPI during the immediately preceding
Fiscal Year. The annual funding percentage shall not be subject
to decrease in the event of any decrease in the CPI. For
example, after Fiscal Year 1, assuming the year to year increase
in the CPI is 2%, then the maximum annual funding percentage
increase is 3.5% times 2.0%, or .07%, thus making the revised
annual percentage a maximum of 3.5% plus .07%, or 3.57%. Buyer,
in its sole discretion, may either fund the Maintenance Capital
Expenditure Reserve or deem the Maintenance Capital Expenditure
Reserve funded for each applicable Fiscal Year. In the event the
Maintenance Capital Expenditure Reserve is not actually funded in
any given Fiscal Year, it shall be deemed funded. The
Maintenance Capital Expenditures Reserve shall be reduced from
time to time, but not below zero, by the amount of Maintenance
Capital Expenditures incurred by Buyer (in the manner set forth
under the definition of "Excess Unexpended Maintenance Capital
Expenditure Reserves") and by the amount, if any, of Excess
Unexpended Maintenance Capital Expenditure Reserves.
"Management Agreement" means that certain
Management and Administrative Services Agreement in form and
substance as set out in Exhibit E by and between Buyer and ACI
relating to the Project. The Management Fee, as defined in the
Management Agreement (not to exceed 4% of the gross revenues of
the Project), shall be considered as an operating expense of the
Project, but any and all interest payable thereon pursuant to the
Management Agreement shall be excluded as an operating expense of
the Project.
"Material Adverse Change" means a material adverse
change in any of: (i) the condition of the business,
performance, prospects, operation or assets of Seller (financial
or otherwise), including without limitation the suitability of
the Leased Site for the development of the Project; (ii) the
value of the Leased Site as a location for the Project; (iii) the
legality, validity or enforceability of this Agreement; (iv) the
rights and remedies of Buyer under this Agreement; or (v)
Applicable Law.
"Material Adverse Effect" means one or more
effects that, individually or in the aggregate, could result from
a Material Adverse Change.
"Net Free Cash Flow" means a sum determined and
calculated at the end of each Fiscal Year upon the issuance of
the Financial Statements for such Fiscal Year as follows:
The operating income (loss) for the Project for an
applicable Fiscal Year as determined in accordance with GAAP
and other accounting principles employed by ACI in the
preparation and issuance of its consolidated financial
statements, each applied on a consistent basis, adjusted to
add or subtract (as indicated) the following items for such
Fiscal Year:
1. Additions to operating income (loss):
(a) depreciation and amortization of assets;
(b) Excess Unexpended Maintenance Capital
Expenditures Reserves;
(c) Project-Related Interest Income.
2. Deductions from operating income (loss):
(a) interest expense on any and all Project-
Related Debt;
(b) required principal payments on Project-Related Debt;
(c) all sums required to be paid into any and all sinking funds
or reserves for the purpose of retirement of all or a
portion of the principal amount of any or all Project-
Related Debt at scheduled maturity, if such sinking fund
or reserve is required by the holder of such Debt and
such holder is not an Affiliate of Buyer;
(d) the actual or deemed funding of the Maintenance Capital
Expenditures Reserve;
(e) an amount necessary to provide ACI a non-cumulative
preferred rate of return of [[ ]] percent per annum on its
Unreturned Project Equity for such Fiscal Year; provided
that such deduction shall be limited to the extent necessary
to prevent the Net Free Cash Flow of Buyer for such Fiscal
Year being reduced to below zero;
(f) deductions shall not be double counted if the same payment
fits under more than one category.
"Opening Date" means the date on which the
Excursion Gambling Boat included in the Project opens for
business.
"Party" means a Person named as entering into this
Agreement.
"Permit" means all approvals, authorizations,
consents, licenses, franchises, orders and other permits of any
Governmental Authority.
"Permitted Encumbrances" means: (i) taxes and
assessments, general and specific, not due and payable on or
before the Closing Date; and (ii) those title exceptions listed
in the commitment for title insurance to be obtained by Buyer
which do not or will not, in the sole discretion of Buyer, impair
the leasehold interest in, or the intended development, use,
operation or occupancy of, the Leased Site.
"Person" means any natural person, corporation,
joint venture, association, company, trust, joint stock company,
bank, trust company, land trust, vehicle trust, business trust,
real estate investment trust, limited liability company, limited
liability partnership, limited liability trust, partnership or
other organization irrespective of whether it is a legal entity,
and any Governmental Authority.
"Prime Rate" means the prime rate as published
from time to time by ▇▇▇▇▇ Fargo Bank, N.A. or if such rate
ceases to be published, then the prime rate as published daily in
The Wall Street Journal.
"Prime Territory" has the meaning set forth in
Section 4.3.14.
"Project" means Buyer's proposed development of
the Leased Site, including a casino with approximately 2,000 slot
machines and 60 table games, or approximately 2,360 gaming
positions, and related improvements such as restaurants and
parking. It is currently contemplated that there will be
multiple restaurant offerings with total seating for
approximately 700 to 750 guests. The term "Project" includes
such additional improvements, renovations and/or expansions of
existing improvements as Buyer may, at its sole discretion, elect
to develop. Buyer may, at its sole discretion, elect from time
to time to change the scope of the Project, but not the Purchase
Price or the Royalty payable to Seller.
"Project Costs" means all costs and obligations
incurred by Buyer in developing, constructing, financing and
operating the Project.
"Project Documents" means all engineering studies,
architectural and engineering drawings or plans, elevations, site
studies, Coast Guard permit applications (if any), U.S. Army
Corps Of Engineers' permit application(s), if any, the Seller's
and its predecessor's Missouri Gaming Commission license
application(s), title insurance commitment(s) and policies, if
any (including all copies of recorded or unrecorded documents
listed as exceptions to the title of the Leased Site), surveys,
environmental reports, market studies, applications for zoning or
rezoning of all or a portion of the Leased Site, all
correspondence, documents and/or agreements pertaining to the
Lease and/or all or any portion of the Leased Site; all
correspondence, documents and/or agreements relating to nearby or
adjoining property to the Leased Site, information, presentations
and other material used or useful in connection with any attempts
by Seller to develop the Project. A list of such documents is
attached hereto as Exhibit F.
"Project Equity" means the equity investment of
ACI in Buyer for the Project plus the retained earnings
accumulated within the Buyer to the extent that any such
undistributed retained earnings are used for capital expansion,
additions and improvements, excluding Maintenance Capital
Expenditures funded out of the Maintenance Capital Expenditures
Reserve.
"Project-Related Debt" means all bona fide
indebtedness incurred by or allocated to Buyer in connection with
the development, construction, maintenance, operation, expansion
or improvement of the Project and all refinancing indebtedness in
respect thereof, including any and all loans to Buyer from one
(1) or more Affiliates of Buyer on which the rate of interest
shall be the Prime Rate plus five and one-half (5.5) percentage
points. Notwithstanding any provision hereof to the contrary:
(x) any indebtedness incurred or guaranteed by Buyer for the
purposes set forth in the immediately preceding sentence which is
also incurred by any Affiliate(s) of Buyer as co-borrower(s)
and/or guaranteed by any Affiliate(s) of Buyer shall be deemed to
be indebtedness incurred by such Affiliate(s) of Buyer and loaned
to Buyer, such that Buyer shall be obligated to pay to such
Affiliate(s) any difference between the actual rate of interest
payable to the third party lender(s) and the lesser of (i) such
actual rate of interest plus five (5) percentage points, or (ii)
the Prime Rate plus five and one-half (5.5) percentage points;
and (y) Project-Related Debt does not include the Promissory Note
nor indebtedness otherwise incurred by or allocated to Buyer in
order to make loans to one (1) or more Affiliates or as part of a
consolidated borrowing group with one (1) or more Affiliates.
"Project-Related Interest Income" means the
interest income earned by Buyer as reported on the Buyer's
Financial Statements, excluding interest income earned on loans
or advances to Affiliates of the Buyer or on loans or advances to
third parties not in the ordinary course of Buyer's business.
"Promissory Note" means that negotiable promissory
note in the original principal amount of [[ ]] to be executed
by Buyer, payable to the order of Seller and which is to be in
the form of Exhibit G.
"Purchase Price" has the meaning set forth in
Section 3. 1. 1.
"Responsible Officer" means: (i) in the case of a
corporation, the president, the chief executive officer, the
chief financial officer, a vice president or a treasurer of such
corporation; (ii) in the case of a partnership, a general partner
therein; or (iii) in the case of a limited liability company, a
manager of such entity.
"Royalty" means that portion of the Purchase Price
set forth in Section 3.1.2.
"Seller" has the meaning set forth in the opening
paragraph of this Agreement. Unless otherwise indicated by the
context of usage (e.g., "any entity comprising Seller"),
references to Seller herein shall be deemed to refer to each of
Futuresouth, Southboat and SLP individually and all such entities
collectively, and their respective successors and permitted
assigns, if any. The Persons comprising Seller shall be jointly
and severally liable for all obligations of Seller pursuant to
this Agreement and the Transfer Documents.
"Seller Collateral" means the collateral which
secures the Promissory Note and the Royalty, namely a collateral
assignment of the Lease in the form attached hereto as Exhibit H
and a security interest in the Project Documents pursuant to a
security agreement in the form attached hereto as Exhibit I,
which collateral liens shall be subordinated to any lien on the
same collateral held from time to time by a holder of Project-
Related Debt that is not an Affiliate of Buyer, whether such
holder is the original holder of such lien or an assignee.
"Showboat" means Showboat Development Company, a
Nevada corporation.
"Stock" means shares of capital stock (including
common and preferred stock) or other equity interests (regardless
of how designated) of or in a corporation or comparable entity
(including, without limitation, a partnership, joint venture,
limited liability company or liquidating trust), whether voting
or nonvoting, general or limited.
"Stock Equivalents" means all securities
convertible into or exchangeable for Stock and all warrants,
options and other rights to purchase or subscribe for any Stock,
or other Stock Equivalents, whether or not presently convertible,
exchangeable or exercisable.
"Subsidiary" with respect to Seller means any
corporation of which Seller and its other Subsidiaries own not
less than 50% of the outstanding Stock of such corporation having
ordinary voting power for the election of directors of such
corporation.
"Tax" means any tax, charge, fee, levy, duty,
withholding or other assessment, together with any interest and
penalties, additions to tax and additional amounts imposed by any
Governmental Authority.
"Third Person" means a Person other than a Party
or an Affiliate of a Party.
"Transfer Documents" means the Assignment and
Assumption Agreement, the ▇▇▇▇ of Sale and all other assignments,
certificates of title and other documents referred to in Section
4.3.
"Unreturned Project Equity" for any Fiscal Year
means: (i) the Project Equity as of the first day of such Fiscal
Year plus (ii) the weighted average of all additions to the
Project Equity during such Fiscal Year, reduced by (x) (but not
below zero) ninety percent (90%) of the aggregate amount of Net
Free Cash Flow of Buyer for the immediately preceding Fiscal
Year, and further reduced by (y) the aggregate amount of all
reductions pursuant to the preceding clause (x) for all Fiscal
Years preceding the immediately preceding Fiscal Year.
1.2 Construction. Unless the context of this Agreement
clearly requires otherwise; (i) references to the plural include
the singular and vice versa; (ii) references to any Person include
such Person's successors and assigns but, if applicable, only if
such successors and assigns are permitted by this Agreement;
(iii) references to one gender include all genders; (iv)
"including" is not limiting; (v) "or" has the inclusive meaning
represented by the phrase "and/or"; (vi) the words "hereof",
"herein", "hereby", "hereunder" and similar terms in this
Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement; (vii) section, clause,
Exhibit and Schedule references are to this Agreement unless
otherwise specified; (viii) reference to any agreement (including
this Agreement), document or instrument means such agreement,
document or instrument as amended or modified and in effect from
time to time in accordance with the terms thereof and, if
applicable, the terms hereof, and general or specific references
to any Applicable Law means such Applicable Law as amended,
modified, codified or reenacted, in whole or in part, and in
effect from time to time.
2. Assets, Assumed Contracts and Assumed Liabilities.
2.1 Assets. Subject to the terms and conditions hereof,
on the Closing Date, Seller agrees to sell, assign, transfer, grant,
bargain, deliver and convey to Buyer, and Buyer agrees to
purchase from Seller, the Assets. The conveyances of the Assets
are to be made as follows:
2.1.1 Lease. Seller agrees to execute and deliver
to Buyer, or cause to be executed and delivered to Buyer, at the
Closing, the Assignment and Assumption Agreement respecting the
Leased Site.
2.1.2 Project Documents. Seller agrees to execute
and deliver to Buyer at the Closing, the ▇▇▇▇ of Sale conveying to
Buyer all the Project Documents.
2.2 Assumed Contracts and Liabilities. Subject to the
terms and conditions hereof, Buyer agrees to execute and deliver
to Seller, and Seller agrees to execute and deliver to Buyer, at
the Closing the Assignment and Assumption Agreement whereby Buyer
assumes, upon the terms set forth therein, the Lease.
2.3 Assumption of Liabilities. Except for the Lease,
Buyer and Seller agree that Buyer is not assuming any liability of
Seller or of any Affiliate of Seller (including, but not limited to,
obligations, if any, to Showboat) and hereby disclaims
responsibility for any Debts, Contractual Obligations, or other
obligations of Seller or of any Affiliate of Seller not so
specifically assumed. Except for obligations accruing or arising
under the Lease from and after the Closing Date, the Parties
intend that Buyer is not, nor is it to be deemed, a successor of
Seller or of any Affiliate of Seller with respect to any of
Seller's or of any such Affiliate's Debts, Contractual
Obligations or other obligations to Third Persons arising or
accruing before, on or after the Closing Date.
3. Purchase Price.
3.1 Purchase Price for the Assets.
3.1.1 Purchase Price. The purchase price payable
by Buyer to Seller for all the Assets is the sum of [[ ]]
(the "Base Purchase Price") plus the Royalty as set forth in
Section 3.1.2 (the Base Purchase Price and the Royalty are
collectively called the "Purchase Price"), all to be paid by wire
transfer or such other means as Seller may reasonably direct.
The Base Purchase Price is payable as follows:
(i) [[ ]] upon the execution and delivery of a
letter of intent relating to this Agreement, which amount Buyer
has previously paid to Seller.
(ii) [[ ]] upon the selection for investigation
by the Missouri Gaming Commission of Buyer's gaming license
application to own and operate an Excursion Gambling Boat as part
of the Project.
(iii) [[ ]] evidenced by the Promissory Note
payable in twelve (12) equal quarterly installments of [[ ]]
each, with the first installment due and payable upon the
Commencement of Construction of the Project by Buyer, and
subsequent installments due every three (3) months thereafter,
together with interest on the unpaid principal balance accrued at
the rate of [[ ]] percent per annum from the date of the
Commencement of Construction. The outstanding principal may be
prepaid at any time, at the option of Buyer, without penalty.
3.1.2 Royalty Payment. Buyer shall, from and
after the Opening Date and for so long as an Excursion Gambling
Boat is operated as part of the Project during the term of the
Lease, pay to Seller an annual payment (the "Royalty") as follows:
(i) The annual payment shall be equal to the
lesser of (a) [[ ]] percent of the Net Free
Cash Flow for each Fiscal Year beginning with
the Fiscal Year in which the Opening Date
occurs, as certified by Buyer's or ACI's
chief financial officer, or (b) [[ ]],
prorated for any partial Fiscal Year. Such
certification shall contain a detailed
calculation of the Royalty showing all
components of such calculation. Buyer's
independent auditors will verify the
determination of the Royalty, and Buyer shall
deliver such verification together with
Buyer's certification of the Royalty. The
foregoing notwithstanding, beginning with the
first full Fiscal Year after the Opening
Date, the amount of annual Royalty payment
for each full Fiscal Year shall not be less
than [[ ]].
(ii) The Royalty payment shall be due and payable
on or before the later of:
(a) Ninety (90) days following the close of
Buyer's Fiscal Year, or
(b) Upon the delivery to Seller of Buyer's
annual Financial Statements as required
pursuant to Section 3.1.5.
(iii) If Buyer shall fail to pay any Royalty
payment when due and shall not cure such
failure within the later of (x) five (5) days
after delivery of written notice of such
failure by Seller to Buyer, or (y) fifteen
(15) days after the due date, then Buyer
shall pay interest thereon at the rate of
twelve percent (12%) per annum from the date
due until paid.
3.1.3 Sale of Project/Foreclosure. In the event
of the sale by Buyer of the Project or the Buyer's leasehold
interest pursuant to the Lease, except as provided below, Buyer
shall require the purchaser (hereinafter sometimes called "Buyer's
Successor") to assume all obligations of Buyer under this
Agreement thereafter arising, including the obligations pursuant
to Section 3.1.2 to pay the Royalty and pursuant to Section 3.1.5
to provide Financial Statements. The Buyer shall remain jointly
and severally liable with Buyer's Successor for performance of
all such obligations; provided that Buyer shall be deemed to be
released from any and all further obligations hereunder (i) if
Buyer's Successor has a tangible net worth at the time of the
closing of such sale greater than $25,000,000.00, (ii) five (5)
years following the date of closing of such sale, or (iii) upon
the subsequent sale of the Project or the leasehold interest
pursuant to the Lease to any Person that is not an Affiliate of
Buyer or of Buyer's Successor. Notwithstanding the foregoing, the
obligations to pay the Royalty and provide the Financial
Statements and Buyer's obligations under Section 7.16 shall not
apply and shall be released forever (a) in the event of a
foreclosure sale by a Lender which is not an Affiliate of Buyer,
or (b) the sale of the Project or the Buyer's leasehold interest
pursuant to the Lease by Buyer, or the direct or indirect sale of
the stock of Buyer by ACI to a Third Person, in either case
described in this clause (b) following any period of three
consecutive full Fiscal Years following the Opening Date in each
of which Buyer has a negative Net Free Cash Flow; provided that
in the event of a sale of the type referenced in clause (b)
above, Buyer shall pay to Seller [[ ]] percent of the net
proceeds, if any, of any such sale in excess of the sum of the
then outstanding Project-Related Debt and Unreturned Project
Equity as and when such net proceeds are received by Buyer.
3.1.4 No Interest in Project. Seller's right to
receive the Royalty shall not entitle Seller to, nor constitute any
legal or equitable interest in, the Project nor in the ownership of
Buyer. The relationship between Buyer and Seller with respect to the
Royalty is solely that of debtor and creditor and none other, and
it is expressly acknowledged and agreed that Buyer is not a
fiduciary for or in respect of Seller.
3.1.5 Delivery of Financial Statements. Following
the Commencement of Construction, Buyer will deliver a copy of its
Financial Statements to Seller within 120 days after the end of
each Fiscal Year or when publicly released, whichever is earlier.
Seller may engage its own auditors, at its expense, to review any
such Financial Statements and the underlying financial records,
during the normal business hours of Buyer's finance department,
upon reasonable advance notice. Such right of review may be
exercised not more than once with respect to the Financial
Statements for each Fiscal Year. Buyer will also provide to
Seller copies of unaudited quarterly financial statements within
sixty (60) days after the end of each fiscal quarter.
4. Closing; Conditions to Closing.
4.1 Closing. The closing of the purchase and sale contemplated
herein (the "Closing") is to occur at the offices of ▇▇▇▇▇▇▇, Mag
& Fizzell, P.C., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇. ▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, on September 28, 2001 or a mutually convenient
date and time within thirty (30) days following the satisfaction
of or written waiver of the conditions set forth in Sections 4.2
and 4.3 of this Agreement, whichever first occurs (the "Closing
Date"). Buyer, at its option, has the right to extend the
Closing Date for up to two (2) additional twelve (12)-month
periods, by delivering to Seller written notice thereof within
thirty (30) days prior to any such date. The foregoing
notwithstanding, the Closing Date shall occur on or before the
Commencement Date (as defined in the Lease) so that the
Commencement Date Fee and the Annual Rent (as defined in the
Lease) shall be payable by Buyer, not Seller. On the Closing
Date, Seller shall convey all of its right, title, and interest
in, and shall surrender possession of, all the Assets to Buyer.
4.2 Seller's Conditions. All of the obligations of
Seller hereunder to be performed at the Closing are subject to the
satisfaction of every one of the following conditions precedent
unless waived in writing by Seller:
4.2.1 the representations and warranties of Buyer
herein are true and correct in all material respects as of the
Closing Date;
4.2.2 Buyer is in compliance with all covenants,
agreements and undertakings of Buyer herein,
4.2.3 all consents, approvals or other authorizations
of third parties, including any Governmental Authorities, required
for the consummation of the transactions contemplated hereby have
been received by Seller,
4.2.4 no proceeding, investigation or inquiry is
pending or threatened by or before any arbitrator or Governmental
Authority to enjoin, restrain or prohibit, or to obtain material
damages in respect of, or which is related to or arises out of this
Agreement or the consummation of the transactions contemplated
hereby.
4.2.5 at the Closing, Buyer tenders to Seller the
following documents, executed in a manner and otherwise in form and
substance reasonably satisfactory to Seller:
4.2.5.1 a copy of resolutions duly adopted
by the board of directors of Buyer authorizing the execution and
delivery of this Agreement by Buyer and the consummation of the
transactions herein contemplated to be consummated by Buyer,
including the Promissory Note, and the Assignment and Assumption
Agreement, duly certified, as of the Closing Date, by the secretary
or any assistant secretary of Buyer;
4.2.5.2 a certificate, dated as of the Closing
Date, of a Responsible Officer of Buyer to the effect that all of the
conditions precedent to Buyer's obligations in Section 4.3 that
have not been waived by Buyer have been satisfied, and that the
representations and warranties of Buyer herein are true and
correct in all material respects as of the Closing Date;
4.2.5.3 a certificate of the secretary or
assistant secretary of Buyer certifying the names and signatures of
the officers of Buyer who have been authorized to execute and deliver
this Agreement and any other agreement executed and delivered on
behalf of Buyer in connection herewith;
4.2.5.4 a copy of the articles or certificate
of incorporation of Buyer certified as correct and complete as of
a recent date by the Secretary of State or comparable official of
the jurisdiction of incorporation of Buyer, together with a certificate
containing the attestation of such official as to the good standing of
Buyer in such jurisdiction, and a copy of the bylaws of Buyer,
certified as correct and complete as of the Closing Date by the
secretary or assistant secretary of Buyer;
4.2.5.5 the Promissory Note;
4.2.5.6 the Assignment and Assumption Agreement;
4.2.5.7 the collateral assignment of the Lease,
security agreement and UCC-1 financing statements constituting and
evidencing the Seller Collateral;
4.2.5.8 the legal opinion of counsel for Buyer
in form and substance as set out in Exhibit J; and
4.2.5.9 all conditions under the Lease to the
assignment of the Lease to Buyer have been satisfied or waived by Landlord.
4.3 Buyer's Conditions. All of the obligations of Buyer
hereunder to be performed at the Closing are subject to the
satisfaction of every one of the following conditions precedent
unless, waived in writing by Buyer;
4.3.1 the representations and warranties of Seller
herein are true and correct in all material respects as of the Closing
Date,
4.3.2 Seller is in compliance with all covenants,
agreements and undertakings of Seller herein;
4.3.3 no Material Adverse Change has occurred;
4.3.4 all consents, approvals or other authorizations
of third parties, including any Governmental Authorities, required
for the consummation of the transactions contemplated hereunder
have been received by Buyer and/or ACI (including the approval of
St. Louis County if and to the extent required by Buyer);
4.3.5 No proceeding, investigation or inquiry is
pending or threatened by or before any arbitrator or Governmental
Authority to enjoin, restrain or prohibit, or to obtain material
damages in respect of, or which is related to or arises out of, this
Agreement or the consummation of the transactions contemplated
hereby, or which could reasonably be expected to result in a
Material Adverse Effect;
4.3.6 Buyer has obtained current judgment,
tax and other lien and Uniform Commercial Code financing statement
search reports showing no liens against the Leased Site or any of
the Assets, other than taxes not yet due and payable;
4.3.7 on or before the Closing, Seller shall have
tendered to Buyer the following documents, executed in a manner and
otherwise in form and substance reasonably satisfactory to Buyer:
4.3.7.1 a copy of resolutions duly adopted by
the shareholders and directors of Futuresouth and Southboat
authorizing the execution and delivery of this Agreement by
Seller and the Transfer Documents and the consummation of the
transactions herein and therein contemplated to be consummated by
Seller, duly certified, as of the Closing Date, by the respective
secretary or any assistant secretary of Futuresouth and Southboat;
4.3.7.2 certificates, dated as of the Closing
Date, of Responsible Officers of Futuresouth, Southboat and SLP to
the effect that all of the conditions precedent to Seller's
obligations in Section 4.2 that have not been waived by Seller
have been satisfied, and that the representations and warranties
of Seller herein are true and correct in all material respects as
of the Closing Date;
4.3.7.3 a copy of resolutions duly adopted by
the shareholders and directors of the corporate general partner of
SLP authorizing the execution and delivery of this Agreement by SLP
and the Transfer Documents and the consummation of the transactions
herein and therein contemplated to be consummated by Seller, duly
certified, as of the Closing Date, by the respective secretary or
any assistant secretary of such corporate general partner.
4.3.7.4 a copy of resolutions duly adopted
by the limited partner of SLP authorizing the transactions contemplated
herein and in the Transfer Documents to be consummated by Seller, duly
certified, as of the Closing Date, by the secretary or any
assistant secretary of the corporate general partner.
4.3.7.5 releases and Uniform Commercial Code
termination statements, executed by the appropriate secured parties
and in a form appropriate for recording and filing that are sufficient
to release any and all Encumbrances against the Assets other than
Permitted Encumbrances;
4.3.7.6 copies of the respective articles or
certificates of incorporation of Futuresouth, Southboat and the
corporate general partner of SLP, certified as correct and complete
as of a recent date by the Secretary of State or comparable official
of thejurisdictions of incorporation of Futuresouth, Southboat and
the corporate general partner of SLP together with a certificate
containing the attestation of such official as to the good
standing of Futuresouth, Southboat or the corporate general
partner of SLP as the case may be, in such jurisdiction, and a
copy of the respective bylaws of Futuresouth, Southboat and the
corporate general partner of SLP, certified as correct and
complete as of the Closing Date by the respective secretaries or
assistant secretaries of Futuresouth, Southboat and the corporate
general partner of SLP;
4.3.7.7 a copy of the Amended and Restated
Agreement of Limited Partnership of SLP, certified as correct and
complete as of a recent date by the corporate general partner of SLP,
together with a certificate of the Missouri Secretary of State attesting
to the good standing of SLP and a copy of the certificate of
limited partnership, certified as correct and complete as of a
recent date by the Missouri Secretary of State.
4.3.7.8 a legal opinion of Seller's legal counsel
directed to the Buyer in form and substance as set out in Exhibit K.
4.3.7.9 an estoppel certificate from Landlord,
in form and substance satisfactory to Buyer, certifying that (i) the
Lease is in full force and effect, (ii) there exists no default(s) under
the Lease, (iii) to the Landlord's knowledge, there exists no
event or circumstance that with notice and/or the passage of time
will cause a default to occur under the Lease, and (iv) all
representations and warranties of Landlord set forth in Section 8
of the Lease shall be deemed to have been remade without
qualification or exception by Landlord to Buyer as of the Closing
Date.
4.3.7.10 a certificate from each shareholder of
Futuresouth in form and substance as set out in Exhibit L, delivered
to Buyer prior to the execution and delivery of this Agreement by Buyer
and to be reaffirmed as of the Closing Date; and any disclosures
set forth on any disclosure schedules to such certificates shall
be acceptable to Buyer in its sole discretion; provided that
Buyer shall act in good faith with respect thereto.
4.3.8 The completion to Buyer's satisfaction of
background investigations of all the Seller's entities and their
respective management, personnel and owners pursuant to ACI's
Gaming Compliance Program, as required by the Nevada Gaming
Control Board.
4.3.9 The satisfactory completion, in Buyer's sole
discretion, of its due diligence investigation concerning the
Leased Site and Project, including environmental matters, title
matters, survey, utilities, traffic, highway, soil structure,
zoning, access, the "offsite work conditions" as provided in the
Lease, and the feasibility of developing and operating the
Project on the Leased Site.
4.3.10 The consent of Landlord and any requisite
Governmental Authority to the assignment and assumption of the Lease.
4.3.11 Approval by Landlord, the Missouri Gaming
Commission, the U.S. Army Corps of Engineers, the U.S. Coast Guard,
local land use planning and zoning authorities and all Governmental
Authorities having jurisdiction over the Project, in such a
manner as to not materially decrease the size and scope of the
Project, except as otherwise acceptable to Buyer in its sole
discretion.
4.3.12 Buyer must be reasonably satisfied that the
ingress and egress to the Leased Site shall be improved (and at a cost,
if any, to Buyer, acceptable to Buyer in its sole discretion) in a
manner sufficient to handle the projected traffic flow to and
from the Leased Site. Buyer must be reasonably satisfied that
improvements shall be permitted on the Leased Site and
surrounding properties to enhance the visibility and prominence
of the Leased Site, including the development of an off-site
lighted monument sign and directional signage in the surrounding
area. Buyer shall be satisfied in its sole discretion, that the
hardscape and landscape along the major access roads leading to
the Leased Site shall be satisfactorily improved.
4.3.13 No additional Excursion Gambling Boat or other
casino shall be licensed or approved for development in Missouri that is
within a radius of fifteen (15) miles of the Leased Site and that
is south of Interstate 64 (the "Prime Territory").
4.3.14 Receipt by Buyer, in form and substance
acceptable to Buyer, of a commitment for an ALTA leasehold title
insurance policy from a title insurer selected by Buyer, insuring
Buyer's leasehold interest in the Leased Site, subject only to the
Permitted Encumbrances.
4.3.15 On or before the Closing, Seller shall have
tendered to Landlord the duly executed Assignment Release (as defined
in the Lease).
5. Representations and Warranties of Seller. Notwithstanding
any provision in this Agreement to the contrary, all
representations in this Agreement by Seller, including everything
in this Section 5, are limited by the qualification in this
paragraph. Since Southboat and SLP were controlled and operated
by Showboat prior to December 11, 1997, all representations
herein by Southboat and SLP are limited to the period from and
after December 11, 1997, and do not apply to any periods before
that date. In order to induce Buyer to enter into this Agreement
and to close the transactions contemplated hereunder, Seller
makes the following representations and warranties to Buyer as of
the date hereof and as of the Closing Date:
5.1 General Representations and Warranties.
5.1.1 Organization. Futuresouth and Southboat
are duly organized and validly existing corporations in good
standing under the laws of the jurisdiction of their
respective incorporations, and each has the power and authority
to own, lease and operate its assets and properties and to conduct
its business as now being conducted. Southboat is licensed and
qualified to do business as a foreign corporation and is in good
standing in the State of Missouri. Futuresouth and Southboat
have not conducted business under any name other than their
respective corporate names except as set forth in Disclosure
Schedule 5.1.1. SLP is a duly organized and validly existing
limited partnership in good standing under the laws of the
jurisdiction of its organization, and has the power and authority
to own, lease and operate its assets and properties and to
conduct its business as now being conducted.
5.1.2 Ownership. Futuresouth owns beneficially
and of record all outstanding shares of the capital stock of Southboat.
Disclosure Schedule 5.1.2 is a listing of all beneficial and
record holders of Stock in Futuresouth and the number of shares
of Stock held beneficially and/or of record by each of them.
Except as provided on Disclosure Schedule 5.1.2, no entity
comprising Seller has issued any Stock Equivalents. The only
partners of SLP are Futuresouth and Southboat, and neither such
partner has assigned or agreed to assign any of its interest in
SLP.
5.1.3 Authorization. There is no provision in the
articles of incorporation, certificates of incorporation, bylaws or
agreement of limited partnership or other governing documents of
any entity comprising Seller which prohibits or limits Seller's
ability to consummate the transactions contemplated herein.
Seller has the full right, power and authority to enter into this
Agreement, to consummate all of the transactions contemplated and
to fulfill all of the obligations to be fulfilled by Seller
hereunder. The execution and delivery of the Lease by SLP and
the execution and delivery of this Agreement by Seller and the
due consummation by Seller of the transactions contemplated
hereby will be duly authorized by all necessary action of the
directors and shareholders of Futuresouth and Southboat, the
directors and shareholders of the corporate general partner of
SLP and the limited partner of SLP and Seller has delivered
copies thereof to Buyer prior to the execution and delivery of
this Agreement by Buyer. This Agreement constitutes a legal,
valid and binding agreement of each entity comprising Seller
enforceable against each such entity in accordance with its
terms.
5.1.4 Subsidiaries and Partnerships. No entity
comprising Seller has any Subsidiary, nor owns stock or any other
interest in any corporation or other entity, except for the interests
that Futuresouth owns in Southboat and SLP.
5.1.5 No Conflict or Violation. Assuming all
consents necessary to transfer the Assets to Buyer are obtained in
a timely fashion, neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated
to be consummated by Seller hereby nor compliance by Seller with
any of the provisions hereof will result in: (i) a violation of
or a conflict with any provision of the articles or certificates
of incorporation, limited partnership agreements or comparable
organizational documents or bylaws of any entity comprising
Seller; (ii) to the best of Seller's knowledge, after due
investigation, a breach of, or right of termination, forfeiture
or default under any term, condition or provision of any
Contractual Obligation or Permit to which any entity comprising
Seller is a party or by which any of its assets is bound or
affected, or an event which, with the giving of notice, lapse of
time, or both, would result in any such breach, right of
termination, forfeiture or default; (iii) to the best of Seller's
knowledge, after due investigation, a violation of any Applicable
Law, or order, judgment, writ, injunction, decree or award, or an
event which with the giving of notice, lapse of time, or both,
would result in any such violation; (iv) to the best of Seller's
knowledge, after due investigation, an imposition of any
Encumbrance on any Asset, or an event which, with the giving of
notice, lapse of time, or both, would result in any such
imposition; or (v) to the best of Seller's knowledge, after due
investigation, any Person having the right to enjoin, rescind or
otherwise prevent or impede the transactions contemplated hereby
or to obtain damages from Buyer or to obtain any other judicial
or administrative relief as a result of any transaction carried
out in accordance with the provisions of this Agreement.
5.1.6 No Burdensome Restrictions. No entity
constituting Seller is a party to any Contractual Obligation the
performance of which will result in the creation of an Encumbrance
on any Asset. To the best of Seller's knowledge, after due
investigation, no entity comprising Seller is in breach or
violation of, or in default under or with respect to any
Contractual Obligation which breach, violation or default has any
reasonable likelihood of having a Material Adverse Effect, nor
has any event occurred which constitutes or, with the giving of
notice, lapse of time, or both, would constitute such a breach,
violation or default. No entity comprising Seller is subject to
any Applicable Law, compliance with which has any reasonable
likelihood of having a Material Adverse Effect.
5.1.7 Litigation and Proceedings. Except as
set forth in Disclosure Schedule 5.1.7, there are no actions, suits,
proceedings or investigations pending (other than any
investigation relating to Buyer's application for a license to
operate an Excursion Gambling Boat at the Leased Site) or, to the
best of Seller's knowledge after due investigation, threatened
against or directly affecting any entity comprising Seller or any
of their respective properties or their respective directors,
officers or employees (in their capacities as such) before any
Governmental Authority relating to the Leased Site or the Assets,
nor is there any valid basis for any such action, suit,
proceeding or investigation. No entity constituting Seller has
been charged with, nor, to the best of Seller's knowledge after
due investigation, is under investigation with respect to, any
charge which has not been resolved concerning any violation of
any Applicable Law with respect to any entity comprising Seller
or the Assets nor is there a valid basis for any such charge or
investigation. No judgment, order, writ, injunction, decree or
assessment or other command of any Governmental Authority
affecting any entity comprising Seller or the Assets is entered
or in effect. There is no action, suit, proceeding or
investigation pending or, to the best of Seller's knowledge,
after due investigation, threatened which challenges the validity
of this Agreement or the transactions contemplated hereunder, or
otherwise seeks to prevent, directly or indirectly, the
consummation of such transactions, nor is there any valid basis
for any such action, suit, proceeding or investigation.
5.1.8 Consents and Approvals. No consent,
approval or authorization of any Person, nor any declaration,
filing or registration with any Governmental Authority or other
Person, is required to be made or obtained by any entity constituting
Seller in connection with the execution, delivery and performance by
Seller of the transactions contemplated hereunder, except as set
forth in Disclosure Schedule 5.1.8.
5.1.9 Disclosures. All disclosures made by or on
behalf of any and all entities comprising Seller in connection with
the background investigation under ACI's Gaming Compliance Program
are and will be true, complete and correct.
5.2 Representations and Warranties With Respect to the Assets.
5.2.1 Title to Assets. Since the acquisition of
the Assets by Seller on or about December 11, 1997, there have
been no acquisitions or dispositions of the Assets. Seller has
not, directly or indirectly, by operation of law or otherwise,
transferred or assigned all or part of its right, title or
interest in and to any of the Assets to any other Person.
5.2.2 Leased Site. Seller has no knowledge of
any federal, state, county or municipal pending proceedings to
change any highways or road systems adjoining the Leased Site or
to restrict or change access from any such highway or road to the
Leased Site or of any pending proceedings for improvements which
might result in a special assessment against the Leased Site.
5.2.3 Project Documents. To the best of Seller's
knowledge, Exhibit F is a true, accurate and complete list of all
Project Documents that are possessed by Seller and which were
delivered to Seller by Showboat, and all such Project Documents have
previously been delivered to Buyer by Seller for review and
photocopying.
5.2.4 Other Assets. Neither Seller nor any
Affiliate of Seller owns or possesses any assets, other than the
Assets, respecting the Leased Site or the development thereof. In
the event that any such assets are discovered, Seller shall promptly
deliver written notice thereof to Buyer and shall promptly convey
such assets to Buyer upon Buyer's request.
5.3 Representations and Warranties With Respect to the
Liabilities of Seller.
5.3.1 Debts. Seller has no Debt (whether accrued,
fixed, absolute, contingent or otherwise and whether direct or
indirect, primary or secondary, due or to become due) relating
to the Assets, except liabilities which are set forth in the
Disclosure Schedule 5.3.1. To the best of Seller's knowledge
after due investigation, there is no basis for the assertion against
Seller with respect to the Assets of any liability, obligation,
commitment or Encumbrance which could adversely affect the value
of any of the Assets or the Project or become an Encumbrance on
any of the Assets, except as set forth on such Schedule.
5.3.2 Environmental Matters. Seller has never
been in physical possession of the Leased Site and has never conducted
any environmental site assessments relating to the Leased Site.
Buyer and Seller understand that the Project Documents contain
environmental site assessment materials generated for Showboat;
however, Seller makes no representations or warranties concerning
the correctness or completeness of such materials, except as set
forth in Section 5.5.1. It is agreed that Seller shall not have
any liability for any environmental remediation that may be
necessary on the Leased Site, except in connection with a breach
of the representations, warranties or covenants contained herein.
5.3.3 Insurance. Since January 15, 2000,
Seller has maintained, and as of the Closing will have consistently
maintained general liability insurance coverage with respect to
the Leased Site in an amount of not less than $2,000,000.00 per
occurrence, subject to no deductible.
5.4 Representations and Warranties With Respect to the
Operations of Seller.
5.4.1 Compliance with Laws. Except as set forth
in Schedule 5.4.1, each entity constituting Seller is, to the
best of Seller's knowledge after due investigation, in compliance
with all Applicable Laws. Seller has not received any notice alleging
(or any notice of any investigation related to) any violation by
Seller or any entity constituting Seller of any Applicable Law,
which notice has not been fully and completely resolved as of the
date of this Agreement.
5.4.2 Condemnation, Eminent Domain, Rezoning
and Leasing. No part of the Leased Site is, to the best of Seller's
knowledge, the subject of any pending condemnation, eminent domain,
rezoning or similar proceeding. Seller has not listed the Leased Site
(or any portion thereof) for lease or sub-lease with any real estate
broker, listing agent or similar Person. To the best of Seller's
knowledge, none of the Leased Site is subject to a lease or
similar Contractual Obligation, other than the Lease.
5.4.3 Improper Payments. Except as set forth
in Schedule 5.4.3, neither Seller nor any agent acting on behalf
of Seller has at any time (i) made any contributions to any candidate
for political office in violation of Applicable Law, or failed to
disclose fully any contributions to any candidate for political
office in accordance with any Applicable Law requiring such
disclosure or (ii) made any payment to any local, state, federal
or foreign governmental officer or official, or other person
charged with similar public or quasi-public duties, other than
payments required or allowed by Applicable Law.
5.5 Representations and Warranties With Respect to Seller's
Disclosures.
5.5.1 Material Omissions. To the best of Seller's
knowledge, in addition to the foregoing representations and
warranties contained in this Section 5, neither this Agreement
nor any statement, list, certificate or other information furnished
or to be furnished by or on behalf of Seller in connection with this
Agreement or any of the transactions contemplated hereby contains
an untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein
or therein not misleading, or which if disclosed would reasonably
affect the decision of a Person considering a purchase of the
Assets for the Project.
5.5.2 Brokers. No agent, broker or other Person
acting pursuant to express or implied authority of Seller is entitled
to a commission or finder's fee in connection with the transactions
contemplated by this Agreement or, pursuant to express or implied
authority of Seller, will be entitled to make any claim
(including the assertion of an Encumbrance) against Buyer or all
or any portion of the Assets for a commission or finder's fee.
5.5.3 Project Documents. Seller will, at Closing,
quitclaim all of Seller's right, title and interest in and to the
Project Documents to Buyer; however, Seller makes no express or
implied warranties of any kind concerning the Project Documents,
except as otherwise expressly provided herein. Seller shall have no
liability of any kind to Buyer if Buyer cannot legally use the
Project Documents, or if they are not assignable, or for defects
in such documents, or for any other matter related to such
documents, except in connection with a breach of the
representations, warranties or covenants contained herein.
6. Representations and Warranties of Buyer. Buyer makes the
following representations and warranties to Seller:
6.1 Organization. Buyer is a duly organized and validly
existing corporation in good standing under the laws of the
jurisdiction of its incorporation, and has the power and
authority to own, lease and operate its assets and properties and
to conduct its business as now being conducted.
6.2 Authorization. There is no provision in Buyer's
articles or certificate of incorporation or comparable organizational
documents or in its bylaws which prohibits or limits Buyer's
ability to consummate the transactions contemplated hereunder.
Subject to the provisions of Sections 4.3.8 and 4.3.9 and to the
other terms and conditions of this Agreement, Buyer has the full
right, power and authority to enter into this Agreement and to
consummate or cause to be consummated all of the transactions and
to fulfill all of the obligations contemplated hereunder
excepting those matters contemplated herein that are subject to
approval by Governmental Authority. The execution and delivery
of this Agreement by Buyer and the due consummation by Buyer of
the transactions contemplated hereby have been duly authorized by
all necessary action of the board of directors and shareholders
of Buyer. This Agreement constitutes a legal, valid and binding
agreement of Buyer enforceable against Buyer in accordance with
its terms
6.3 No Conflict or Violation. Neither the execution
and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby will result in a material: (i)
violation of or a conflict with any provision of the articles or
certificate of incorporation or comparable organizational
documents or bylaws of Buyer; (ii) breach of, accrual of a right
of termination with respect to, or forfeiture or default under
any term, condition or provision of any Contractual Obligation or
Permit to which Buyer is a party or by which any of its assets is
bound or affected, or an event which, with the giving of notice,
lapse of time, or both, would result in any such breach, right of
termination, forfeiture or default; (iii) violation of any
Applicable Law, or order, judgment, writ, injunction, decree or
award, or an event which, with the giving of notice, lapse of
time, or both, would result in any such violation; or (iv) any
Person having the right to enjoin, rescind or otherwise prevent
or impede the transactions contemplated hereby or to obtain
damages from Seller or to obtain any other judicial or
administrative relief as a result of any transaction carried out
in accordance with the provisions of this Agreement.
6.4 Litigation and Proceedings. There are no actions,
suits, proceedings or investigations pending (other than any
investigation relating to Buyer's application for a license to
operate an Excursion Gambling Boat at the Leased Site) or, to the
best of Buyer's knowledge after due investigation, threatened
against or directly affecting Buyer or any of its properties or
its directors, officers or employees (in their capacities as
such) before any Governmental Authority, nor is there any valid
basis for any such action, suit, proceeding or investigation.
Buyer has not been charged with, nor, to the best of Buyer's
knowledge after due investigation, is under investigation with
respect to, any charge which has not been resolved concerning any
violation of any Applicable Law with respect to Buyer nor is
there a valid basis for any such charge or investigation. No
judgment, order, writ, injunction, decree or assessment or other
command of any Governmental Authority affecting Buyer or any
Affiliate of Buyer is entered or in effect. There is no action,
suit, proceeding or investigation pending or, to the best of
Buyer's knowledge after due investigation, threatened which
challenges the validity of this Agreement or the transactions
contemplated hereunder, or otherwise seeks to prevent, directly
or indirectly, the consummation of such transactions, nor is
there any valid basis for any such action, suit, proceeding or
investigation.
6.5 Consents and Approvals. No consent, approval or
authorization of any Person, nor any declaration, filing or
registration with any Governmental Authority or other Person, is
required to be made or obtained by Buyer in connection with the
execution, delivery and performance by Buyer of the transactions
contemplated to be consummated by Buyer hereunder, except for the
consents and approvals which are contemplated hereunder and such
other consents and approvals as are set out on Disclosure
Schedule 6.5.
6.6 Brokers. No agent, broker or other Person acting
pursuant to express or implied authority of Buyer is entitled to a
commission or finder's fee in connection with the transactions
contemplated by this Agreement or, pursuant to express or implied
authority of Buyer, will be entitled to make any claim (including
the assertion of an Encumbrance) against Seller or the Leased
Site for a commission or finder's fee,
6.7 No Licensing Problems. Buyer is not aware of any
circumstances, whether or not they have been disclosed to the
Missouri Gaming Commission, that would adversely affect Buyer's
ability to obtain a gaming license from the State of Missouri, or
which would adversely affect the ability of Buyer or its
Affiliates to obtain any consents to the Project that they may
need from the gaming authorities of any other state where any of
them do business.
6.8 Ownership. Buyer is wholly owned subsidiary of ACI,
and no other Person has any equity interest in or option to acquire
an equity interest in Buyer.
6.9 Financial Statements of ACI. The audited financial
statements of ACI for its Fiscal Year ended December 31, 1998,
and the unaudited statements of ACI for the nine months ended
September 30, 1999, copies of which have been delivered to
Seller, fairly present the financial condition of ACI as of the
date of said statements and there has been no material adverse
change in the financial condition of ACI since the date of said
statements.
7. Affirmative Covenants. From and after the date hereof, the
Parties covenant and agree as follows:
7.1 Permits. Seller understands and acknowledges that Buyer
has amended and restated the Missouri Riverboat Gaming Applications
previously submitted by Seller or its predecessor, and Seller
hereby reaffirms its consent thereto. On or before the later of
February 11, 2000 and ten (10) days following the execution and
delivery of this Agreement by the Parties, Buyer shall pay to
Seller the sum of $25,000.00 to partially reimburse Seller for
the application fees previously paid by Seller to the Missouri
Gaming Commission. Seller agrees to cooperate with Buyer and to
take all actions reasonably requested by Buyer to assist and
support Buyer in its efforts to obtain all Permits necessary for
the development and operation of the Project. Buyer shall
promptly reimburse Seller for all reasonable out-of-pocket costs
and expenses incurred by Seller in rendering such assistance,
provided that such costs and expenses have been submitted to and
pre-approved by Buyer. Buyer shall bear the costs associated
with all applications for Permits, including the fees of legal
counsel and supporting experts. Seller, if it elects to retain
legal counsel to review such applications, shall bear the cost of
such counsel. In the event any Governmental Authority shall seek
to impose a fee or fees for the investigation of the background
of any entity comprising Seller or any shareholder, officer,
director, partner (limited or general), employee or Affiliate
thereof, such fee and any expenses associated with such
investigation, including legal and accounting fees, shall be paid
by Seller.
7.2 Governmental Investigation. Seller (a) acknowledges
that Buyer's ability to obtain and maintain all Permits necessary
to develop and operate the Project depends in part upon the
completion from time to time to the satisfaction of all relevant
Governmental Authorities, including without limitation the
Missouri Gaming Commission, of a thorough background
investigation and evaluation of Seller, all shareholders,
partners and other Persons with any financial interest or
management role in Seller, and all employees of Seller, which
investigation and evaluation may concern the character,
reputation and criminal records of such Persons; (b) agrees to
cooperate with Buyer to furnish or cause to be furnished all
information and to take or cause to be taken all actions
necessary or expedient to the achievement from time to time of
such satisfactory completion; (c) agrees to promptly notify Buyer
in writing of the occurrence of any changes in the record or
beneficial ownership of any Stock of any of the entities
comprising Seller, which notice shall specify the name of the
entity, the nature of the change or transaction causing the
change, the quantity of Stock involved, and the names and
addresses of all parties to the change or transaction causing the
change; and (d) agrees that, if Buyer is informed, orally or in
writing, through formal notification or otherwise, that any such
Person's interest in or involvement with Seller may or could
delay or jeopardize the ability of Buyer or any Affiliate of
Buyer to obtain or maintain any Permit related to the Project or
otherwise, Buyer shall notify Seller thereof, and, to the extent
permitted by the Missouri Gaming Commission and/or other
Governmental Authority, Seller shall have thirty (30) days after
receipt of such notice in which to try to convince the Missouri
Gaming Commission and/or other Governmental Authority that such
Person's interest does not need to be terminated and should not
delay or jeopardize the ability of Buyer or any Affiliate of
Buyer to obtain or maintain any Permit related to the Project or
otherwise. Buyer agrees to provide Seller with such information
as is made available to Buyer concerning the reasons why the
Missouri Gaming Commission and/or other Governmental Authority
wants such Person's interest terminated or why such Person's
interest in or involvement with Seller may or could delay or
jeopardize the ability of Buyer or any Affiliate of Buyer to
obtain or maintain any Permit related to the Project or
otherwise; provided that Buyer shall have no obligation to obtain
such information or to support or assist Seller in supporting
such Person's continued interest in or involvement with Seller.
The foregoing notwithstanding, Buyer shall, upon receipt of a
written request from Seller, request by letter addressed to the
Missouri Gaming Commission and/or other Governmental Authority
(as the case may be) the disclosure to Seller of such
information; provided that Buyer shall not be obligated to
request such information more than once with respect to any such
Person. If Seller is not successful in said thirty (30) day
period in convincing the Missouri Gaming Commission and/or other
Governmental Authority that such Person's interest does not need
to be terminated, then Seller shall cause such interest or
involvement to be terminated by the sale of such interest to a
suitable Person, the termination of such involvement or
otherwise. Until such termination is effected to the
satisfaction of Buyer or its Affiliate (as the case may be) and
all relevant Governmental Authorities, all rights to any Royalty
payment, payments under the Promissory Note and any other payment
due from Buyer coming due prior to the date on which such
satisfactory termination is effected shall be suspended; provided
that if such satisfactory termination is not effected within
forty-five (45) days following the delivery of the aforesaid
notice to Seller, Seller shall permanently forfeit all rights to
the foregoing payments. Seller agrees that at all times prior to
the termination of such involvement to the satisfaction of Buyer
or its Affiliate (as the case may be) and all relevant
Governmental Authorities, neither Seller nor any Affiliate of
Seller shall have any legal or financial interest or
participation, direct, indirect, attributed or otherwise, in or
to the Project, including any income or revenues therefrom.
7.3 Notices. Seller shall deliver or cause to be delivered
to Buyer, promptly after receipt or delivery (if applicable) of the
same, copies of all notices from any Governmental Authority or
any Person respecting the Leased Site, the Business or the
Project.
7.4 Contracts. Seller will not, except with Buyer's prior
written consent, amend or terminate the Lease, exercise or waive
any rights under the Lease or enter into any material Contractual
Obligation respecting the Leased Site. In the event that Buyer
requests or requires any further extension of the Investigation
Date (as defined in the Lease), Seller shall not be obligated to
obtain any such extension or to pay any consideration to the
Landlord or any Third Person in connection therewith.
7.5 Other Prohibited Transactions. No Party will, without
the prior written consent of the other, take any action or omit to
take any action, suffer any act or omission, which may result in
any of the representations and warranties of such first mentioned
Party being untrue or in the nonfulfillment of any of the
covenants set forth herein. Seller may not (and will not permit
any of its Affiliates to), without the prior written consent of
Buyer (which consent with respect to subsections (i), (iv) and
(v) shall not be unreasonably withheld, but may be given or
withheld in Buyer's sole discretion with respect to all other
subsections below), directly or indirectly, by operation of law
or otherwise; (i) pay any dividends or otherwise make any
distributions to Seller's shareholders in violation of Applicable
Law; (ii) issue any Stock or Stock Equivalent in Seller; (iii)
borrow money using the Lease or Leased Site as collateral; (iv)
fail to pay any of Seller's Debts, to the extent of Seller's
assets, as the same become due; provided that Seller shall have
the right to diligently contest any claimed Debt; (v) dissolve
Seller and form a liquidating trust, the certificated Stock of
which is issued to the then shareholders of Futuresouth, (vi)
merge or consolidate Seller with any other Person; (vii) engage
in any discussions, or solicit or encourage any discussions,
regarding the Leased Site or the Lease, except as provided for
herein; or (viii) agree to do any of the foregoing. Seller will
promptly notify Buyer in writing upon the occurrence of any
Material Adverse Change or event which could have a Material
Adverse Effect.
7.6 Inspection. Buyer and its employees, officers,
shareholders, directors, attorneys, agents, independent auditors
and representatives have the right to make a full due diligence
investigation of the Assets and the books and records of Seller
pertaining thereto. Buyer may conduct engineering or other
inspections necessary or desirable to enable Buyer to evaluate
the Leased Site, and may apply for any Permits which may be
required of Buyer. Seller will cooperate with Buyer in carrying
out the provisions of this Section and will provide Buyer
promptly with such documents and information pertaining to the
Assets as Buyer may reasonably request, if such documents are
under the control of Seller or any Affiliate of Seller. Buyer
agrees to indemnify, hold harmless and defend Seller against any
loss, damages, claim or liability (including mechanic or
materialmen's liens) suffered by Seller and resulting from the
acts or omissions of Buyer or its employees, officers,
shareholders, directors, attorneys, agents, independent auditors
and representatives in inspecting or investigating the Leased
Site pursuant to this Section. Notwithstanding the preceding
sentence, Buyer has no obligation to indemnify, hold harmless or
defend Seller with respect to any matter arising out of Seller's
own negligence or willful misconduct. Sections 11.3 and 11.4
shall apply with respect to Buyer's indemnification obligations
under this Section 7.6. In no event may Buyer commence any
construction on the Leased Site until it has closed on the
purchase of the Assets.
7.7 Contacts. Seller hereby grants Buyer permission to
contact any parties to the Lease or Project Documents for the
purpose of investigating and ascertaining the status thereof.
7.8 Condemnation. If, after the date hereof but prior
to the Closing, condemnation or eminent domain proceedings are
proposed, threatened or commenced against any portion of the Leased
Site which could have a Material Adverse Effect on the prospects or
operation of the Project, Seller will immediately notify Buyer of
such event. Buyer may elect to terminate its obligations under
this Agreement by notice to Seller within ten (10) Business Days
after Buyer receives such notice from Seller, or elect to close
the purchase and sale contemplated herein and receive any and all
condemnation proceeds or awards (collectively the "Proceeds")
payable as the result of such proceeding (including, any such
Proceeds paid to or for the account of Seller or any Affiliate of
Seller prior to the Closing Date, whether or not such Proceeds
then constitute Assets). If Buyer elects to terminate such
obligations, no Party shall have any further obligation under
this Agreement, except for such obligations as expressly survive
termination. If Buyer elects to close, Seller agrees to execute
such assignment documents as Buyer may reasonably require to
effect the assignment to Buyer of all Proceeds to which Seller
has a right.
7.9 Project Documents. Seller shall, if requested in
writing by Buyer's legal counsel, deliver to Buyer or such legal
counsel letters addressed to each of the professional service
companies which prepared or issued any of the Project Documents,
authorizing such companies to communicate freely and otherwise
cooperate with Buyer. The letters shall be in a form and
substance reasonably acceptable to Buyer and Seller.
7.10 Improper Payments. Neither Seller nor any Affiliate
of Seller nor any agent acting on behalf of any of them will (i)
make any contributions to any candidate for political office in
violation of Applicable Law, or fail to disclose fully any
contributions to any candidate for political office in accordance
with any Applicable Law requiring such disclosure or (ii) make
any payment to any local, state, federal or foreign governmental
officer or official, or other person charged with similar public
or quasi-public duties, other than payments required or allowed
by Applicable Law. The provisions of this Section 7.10 will
survive the Closing and the delivery of the Transfer Documents.
7.11 Exclusivity. So long as this Agreement is in effect,
neither Seller nor any Affiliate of Seller shall participate in
any negotiations or discussions or enter into any understanding
or agreement with any third party concerning the Project or the
Leased Site that would conflict with, preclude or serve as an
alternative or "back-up" to this Agreement or the transactions
contemplated hereunder. If Seller or any Affiliate of Seller
receives any written or oral offers or proposals from third
parties for any such negotiations, discussions, understandings or
agreements respecting the Project or the Leased Site, Seller
shall immediately notify Buyer in writing of the identity of the
Person making such offer or proposal and the substance thereof.
7.12 Right of Setoff. Seller agrees, on its behalf and on
behalf of all subsequent holders of the Promissory Note and any
assignees of the Royalty, that Buyer may (at its election) from
time to time set off any and all amounts due Buyer from Seller
(as and when the same become due) against any and all amounts
then due and owing (or to become due and owing) under the
Promissory Note and the Royalty following the delivery by Buyer
to Seller of not less than twenty-five (25) days prior written
notice thereof, which notice shall state the grounds for any such
setoff and shall include copies of any and all appropriate
supporting documentation. In the event that Seller objects to
any such proposed setoff, Seller shall have the right to cause
the matter to be decided by arbitration in accordance with the
provisions of Section 14 hereof. In order to exercise such
right, Seller shall file a notice of a demand for arbitration
with Buyer and the American Arbitration Association within the
aforesaid twenty-five (25) day period. In the event that such
right is timely exercised by Seller, Buyer shall within twenty-
five (25) days following the receipt of the notice of a demand
for arbitration deposit in escrow with U.S. Title Guaranty
Company, Inc. (or such other party upon whom Buyer and Seller may
agree) the amount set off that is in dispute. If the amount
deposited is greater than $25,000.00, such amount shall be held
by the escrow agent in an interest-bearing account, and the
interest earned thereon shall be paid ratably to the party or
parties to whom the amount deposited is disbursed upon the
resolution of the dispute. The escrow agreement shall provide
that the amount escrowed shall be disbursed by the escrow agent
(i) upon receipt of a joint direction from Buyer and Seller, (ii)
in accordance with the arbitration award, or (iii) in accordance
with an order from a court of competent jurisdiction.
7.13 Showboat Development Company. Seller expressly
acknowledges that it shall satisfy any and all of its responsibilities,
liabilities and obligations owed to Showboat under that certain
Stock Purchase Agreement dated the 11th day of December, 1997 by
and between Showboat and Futuresouth, including any amendments
thereto. Seller further agrees to indemnify, defend and save
Buyer harmless from and against any and all claims, demands,
judgments and expenses, including but not limited to attorneys'
fees and expenses of litigation incurred by Buyer in connection
with any claims made by Showboat, its successors and assigns
against Buyer. Sections 11.1, 11.3 and 11.4 shall apply to such
indemnification obligations of Seller.
7.14 Lease Obligations. Prior to the Closing Date, Buyer
shall not be responsible for the performance of any of the obligations
of SLP under the Lease, except that Buyer agrees, subject to the
limitations and conditions set forth in this Agreement, to
cooperate with Seller in connection with the performance of those
obligations specifically applicable to Assignee (as defined in
the Lease), pursuant to Sections 2(c), 3(b) and (c), 4(a) and 13
of the Lease.
7.15 Information. Buyer agrees to provide reasonable reports
to Seller from time to time concerning the status of the Project and
any material changes therein, to meet with representatives of
Seller not less frequently than quarterly for such purposes, and
to respond to reasonable requests from Buyer for information
concerning the status of the Project.
7.16 VIP Privileges. Subject to the provisions of Section
3.1.3 hereof and compliance with Applicable Law, commencing on the
Opening Date and continuing for as long as the Excursion Gambling
Boat included in the Project remains open for business, (i) each
of the shareholders of Futuresouth, so long as they remain
shareholders of Futuresouth, shall be entitled to use, along with
their guests, on a non-exclusive basis, all of the facilities of
the Project that are available for use from time to time by the
customers of the Project, including any club or other facilities
that are available for use by only a portion of such customers,
and (ii) Buyer shall, subject to Applicable Law, provide to
Seller a credit allowance in the amount of $10,000.00 per
calendar year, which may be utilized by Seller (or such
shareholders, as permitted by Seller) to purchase goods and
services available from time to time for purchase by customers of
the Project at then prevailing prices. Buyer may establish and
modify, from time to time, reasonable policies and procedures for
the exercise of Buyer's rights under this Section 7.16. Such
credit allowance shall be prorated for any calendar year in which
the Project is not open for business during part of such year.
If and to the extent that any portion of the credit allowance for
any calendar year is not used in such calendar year, such unused
portion shall be forfeited.
7.17 Transfers of Stock of Seller. Seller will not permit
any direct or indirect sale, assignment, pledge, hypothecation,
transfer or other disposition of any record or beneficial
interest in any Stock of any entity constituting Seller (a
"Transfer") except in compliance with the following provisions:
(a) Transfers Upon Death. Any Transfer occurring
directly as a result of and upon the occurrence of the death of a
natural person may be made so long as the Transfer is in
compliance with all Applicable Laws and the following additional
requirements: (i) Seller will promptly notify Buyer of the
Transfer as required by Section 7.2; (ii) the transferee will
cooperate with any background investigation with respect to the
transferee pursuant to ACI's Gaming Compliance Program; (iii) the
Transfer will be subject to any investigation and/or approval
required by one or more Governmental Authorities as contemplated
by Section 7.2; and (iv) such Transfer shall not in any way limit
or restrict Buyer's rights under Section 7.2 with respect to the
suspension and/or forfeiture of payments by Buyer to Seller.
Transfers permitted pursuant to this clause do not extend to or
include Transfers by the estate of the deceased natural person to
heirs or devisees or by a testamentary trust of the deceased
natural person to beneficiaries of such trust, which Transfers
are subject to clause (c) of this Section 7.17.
(b) Dissolution or Merger of Entities. Any
Transfer of Stock in Southboat or SLP to Futuresouth deemed to
result from the dissolution and liquidation of Southboat or SLP,
or deemed to result from the merger or consolidation of Southboat
or SLP with and into Futuresouth as the surviving entity, may be
made so long as such Transfer complies with Section 7.5 and all
Applicable Laws and Seller promptly notifies Buyer in writing of
the transaction.
(c) Other Transfers. Any other Transfer may be
made only with the prior written consent of Buyer, which consent
will not be unreasonably delayed or withheld. In connection with
any such proposed Transfer, Seller will provide to Buyer in
writing the details of the proposed Transfer and will cause the
proposed transferee to submit to any background investigation
conducted under ACI's Gaming Compliance Program and to cooperate
with any investigations by one or more Governmental Authorities
as contemplated by Section 7.2. Without limiting the foregoing,
Seller acknowledges and agrees that it will not be unreasonable
for Buyer to withhold its consent if (i) Buyer's background
investigation, if any, concerning the transferee under ACI's
Gaming Compliance Program is not satisfactory; (ii) if Buyer is
informed, orally or in writing, through formal notification or
otherwise, that the proposed transferee's interest in or
involvement with Seller may or could delay or jeopardize the
ability of Buyer or any Affiliate of Buyer to obtain or maintain
any Permit related to the Project or otherwise; or (iii) if any
Permit of any Governmental Authority or other requirement of
Applicable Law for the consummation of such Transfer has not been
obtained or satisfied, as the case may be. If Buyer withholds
its consent pursuant to clause (ii) above, Seller will have the
rights set forth in Section 7.2 to seek to convince the
applicable Governmental Authority that the transferee should be
allowed to acquire an interest in Seller and to cause Buyer to
request information from the applicable Governmental Authority.
(d) Legend. Upon the execution of this Agreement
and thereafter, Seller agrees to cause all outstanding and all
newly issued Stock certificates or other indicia of ownership of
any entity constituting Seller to bear the following legend:
THE SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION,
TRANSFER OR OTHER DISPOSITION OF ANY RECORD
OR BENEFICIAL INTEREST IN THE SECURITIES OR
OTHER EQUITY INTERESTS REPRESENTED BY THIS
CERTIFICATE, AGREEMENT OR INSTRUMENT (A
"TRANSFER") IS SUBJECT TO CERTAIN
RESTRICTIONS AND REQUIREMENTS SET FORTH IN AN
ASSET PURCHASE AND SALE AGREEMENT AMONG
FUTURESOUTH, INC., SOUTHBOAT ▇▇▇▇▇, INC.,
SOUTHBOAT LIMITED PARTNERSHIP (AS SELLER ON A
COLLECTIVE BASIS) AND AMERISTAR CASINO ST.
LOUIS, INC. (AS BUYER) DATED AS OF FEBRUARY
___, 2000 (THE "AGREEMENT"). ANY SUCH
TRANSFER MADE IN VIOLATION OF THE AGREEMENT
SHALL BE NULL AND VOID AB INITIO. A COPY OF
THE AGREEMENT IS ON FILE AT THE PRINCIPAL
EXECUTIVE OFFICE OF THE ISSUER.
(e) Effect of Consent. The consent of Buyer to
any proposed Transfer shall not limit or restrict the exercise of
Buyer's rights under Section 7.2 as and when appropriate.
8. Abandonment of Project. In the event Buyer, in its sole
discretion, determines for any reason and at any time prior to
the Commencement of Construction not to proceed with the Project,
Buyer shall deliver written notice thereof to Seller. Upon
delivery of such notice, this Agreement shall terminate and all
parties shall thereafter be released from all further obligations
hereunder, except as expressly stated in this Section or as
otherwise provided herein. Following the delivery of such
notice, Buyer shall reasonably cooperate with Seller for a
reasonable period of time (not to exceed ninety (90) days) in
Seller's efforts, if any, to substitute another company in the
place of Buyer to pursue the Project. In the event of such
termination, Seller shall have the right, but not the obligation,
to require Buyer to assign to Seller its assignable rights,
assets and entitlements to the Project, including the Lease, the
Project Documents, and all other plans and designs, studies,
inspections, reports and permits for the Project in exchange for
an agreement by Seller, in form and substance satisfactory to
Buyer and Seller, to: (i) assume any and all liabilities and
obligations in respect of such assigned rights, assets and
entitlements, (ii) indemnify, protect, defend and hold harmless
Buyer and ACI against and from such liabilities in accordance
with Sections 11.3 and 11.4 of this Agreement, and (iii) pay One
Hundred Dollars ($100.00) to Buyer and ACI; provided, however,
that Seller will not be required to assume, or to indemnify,
protect, defend or hold harmless Buyer and ACI against or from
any liabilities in respect of any intentional torts or frauds for
which Buyer or ACI is responsible.
9. Alternate Site. Alternate Site. Notwithstanding any
provision to the contrary contained herein, in the event that
Buyer, ACI or any other Affiliate of ACI (herein called an "ACI
Entity") shall, during the term of this Agreement (whether prior
to or after the Closing Date) or within thirty (30) months
following the termination of this Agreement by Buyer (other than
a termination pursuant to Section 10.3 hereof), shall have a
gaming license application accepted for investigation by the
Missouri Gaming Commission for a site, other than the Leased
Site, that is within the Prime Territory (the "Alternate Site"),
and such ACI Entity thereafter receives a gaming license and
commences gaming operations on an Excursion Gambling Boat at the
Alternate Site, then Buyer and ACI shall cause such ACI Entity to
pay to Seller the balance of the Purchase Price with respect to
the operation by the ACI Entity of such Excursion Gambling Boat
and any related facilities in accordance with the provisions of
Section 3 hereof, and all other provisions of this Agreement
respecting the Purchase Price shall likewise be applicable
thereto; provided that the foregoing obligation to pay the
balance of the Purchase Price to Seller shall be conditioned upon
Seller taking all actions reasonably requested by any ACI Entity
to assist, support and cooperate with such ACI Entity in its
efforts to obtain all Permits necessary for the development and
operation of such Excursion Gambling Boat and related facilities.
The foregoing notwithstanding, if this Agreement has been
terminated by Buyer due to a failure to satisfy one (1) or more
of the conditions set forth in Section 4.3 hereof, then the
foregoing obligation to pay the balance of the Purchase Price
shall also be conditioned upon the exclusive endorsement by St.
Louis County of the Alternate Site (to the exclusion of all other
sites within the Prime Territory) for the development and
operation by the ACI Entity of an Excursion Gambling Boat. In
addition, in the event that any ACI Entity shall within eighteen
(18) months following the termination of this Agreement (other
than an termination pursuant to Section 10.3 hereof) have a
gaming license application accepted for investigation by the
Missouri Gaming Commission for a site that is outside the Prime
Territory, but within a radius of fifty (50) miles of the Leased
Site, then Buyer and ACI shall cause such ACI Entity to pay to
Seller the sum of [[ ]] dollars upon the issuance to the ACI
Entity by the Missouri Gaming Commission of a gaming license for
the operation of an Excursion Gambling Boat at such site. Buyer
agrees to keep Seller reasonably informed of the efforts of Buyer
or any other ACI Entity related to the pursuit of a license from
the Missouri Gaming Commission for an Excursion Gambling Boat
within a 50-mile radius of the Leased Site.
10. Termination; Default.
10.1 Termination and Abandonment. This Agreement may be
terminated and abandoned at any time prior to the Closing Date as
follows:
10.1.1 By mutual written consent of the Parties.
10.1.2 By written notice to Seller delivered by
Buyer, if any of the conditions set forth in Section 4.3 hereof
have not been satisfied or waived by the Closing Date, or
10.1.3 By written notice to Buyer delivered by
Seller, if any of the conditions set forth in Section 4.2 hereof
have not been satisfied or waived by the Closing Date.
10.2 Effect of Termination. In the event of the termination
or abandonment of this Agreement pursuant to the provisions of
Section 10.1.1, 10.1.2, 10.1.3 or 10.3, this Agreement shall be
void and of no further effect, except to the extent expressly
provided herein.
10.3 Default by Seller. Subject to Section 10.5, in the
event of a default by Seller on any of its obligations hereunder,
Buyer may elect to either: (i) ▇▇▇ for specific performance as set
forth herein; or (ii) terminate this Agreement and ▇▇▇ for
damages; or (iii) terminate this Agreement.
10.4 Default by Buyer. Subject to Section 10.5, in the
event of a default by Buyer on any of its obligations hereunder,
Seller's sole remedy is to terminate this Agreement and ▇▇▇ Buyer
for any and all damages sustained by Seller as a result of such
default, provided, that Seller shall not be entitled to claim as
damages any consequential damages.
10.5 Notice and Cure Rights. Neither party may terminate
thisb Agreement because of a default hereunder by the other party,
unless the nondefaulting party has given the defaulting party
written notice of such default and such default remains uncured
for more than ten (10) calendar days after such notice is
effective.
11. Indemnification.
11.1 Seller. Seller hereby unconditionally, irrevocably and
absolutely agrees to protect, defend, indemnify and hold harmless
Buyer, and Buyer's past, present and future officers, directors,
shareholders, employees, agents, attorneys, representatives,
trustees and beneficiaries, and each of the foregoing's heirs,
personal representatives, successors and assigns, from any and
all manner of actions, suits, debts, sums of money, interest
owed, accounts, controversies, agreements, guaranties, promises,
undertakings, charges, damages, judgments, executions,
obligations and costs, expenses and fees (including reasonable
attorneys' fees and court costs), counterclaims, claims, demands,
causes of action, liabilities, losses and amounts paid in
settlement incurred, paid or sustained by any of the foregoing,
in each case in connection with, arising out of, based upon,
relating to or otherwise involving: (i) any misrepresentation,
breach of warranty or nonfulfillment of any provision of this
Agreement by Seller; (ii) any material error or omission in any
statement, report, exhibit, schedule or other information
delivered to Buyer by or on behalf of Seller; (iii) any claim or
obligation or Debt of Seller to any party not being assumed by
Buyer hereunder which is asserted against Buyer; or (iv) any act
or omission of Seller, its agents, servants or employees
occurring prior to the close of business on the Closing Date.
11.2 Buyer. Buyer hereby unconditionally, irrevocably and
absolutely agrees to protect, defend, indemnify and hold harmless
Seller, and Seller's past, present and future officers,
directors, shareholders, partners, employees, agents, attorneys,
representatives, trustees and beneficiaries, and each of the
foregoing's heirs, personal representatives, successors and
assigns, from any and all manner of actions, suits, debts, sums
of money, interest owed, accounts, controversies, agreements,
guaranties, promises, undertakings, charges, damages, judgments,
executions, obligations and costs, expenses and fees (including
reasonable attorneys' fees and court costs), counterclaims,
claims, demands, causes of action, liabilities, losses and
amounts paid in settlement incurred, paid or sustained by any of
the foregoing, in each case in connection with, arising out of,
based upon, relating to or otherwise involving: (i) any
misrepresentation, breach of warranty or nonfulfillment of any
provision of this Agreement by Buyer; or (ii) any claim,
obligation or Debt of Seller which is expressly assumed by Buyer
hereunder which is asserted against Seller.
11.3 Third Person Claims. Promptly after any Indemnified
Party has received notice of or has knowledge of any claim by a
Third Person, or of the commencement of any action or proceeding
by a Third Person, the Indemnified Party must, as a condition
precedent to a claim with respect thereto being made against an
Indemnifying Party, give the Indemnifying Party written notice of
such claim or the commencement of such action or proceeding.
Such notice must state the nature and basis of such claim and a
reasonable estimate of the amount thereof. The Indemnifying
Party has the right to defend and settle any such matter, at its
own expense and by its own counsel, which counsel shall be
reasonably acceptable to the Indemnified Party, so long as the
Indemnifying Party diligently pursues the same in good faith. If
the Indemnifying Party undertakes so to defend or settle, it must
promptly notify the Indemnified Party of its intention to do so,
and the Indemnified Party must cooperate with the Indemnifying
Party and its counsel in the defense thereof and in any
settlement thereof. Such cooperation includes furnishing the
Indemnifying Party with any books, records or information
reasonably requested by the Indemnifying Party that are in the
Indemnified Party's possession or control. All Indemnified
Parties must use the same counsel, which is the counsel selected
by the Indemnifying Party, provided that, if counsel to the
Indemnifying Party has a conflict of interest that prevents such
counsel for the Indemnifying Party from representing the
Indemnified Party, the Indemnified Party has the right to
participate in such matter through counsel of its own choosing
and the Indemnifying Party must reimburse the Indemnified Party
for the reasonable fees and expenses of its counsel. After the
Indemnifying Party has notified the Indemnified Party of the
Indemnifying Party's intention to undertake to defend or settle
any such asserted liability, and for so long as the Indemnifying
Party diligently pursues such defense in good faith, the
Indemnifying Party is not liable for any additional legal
expenses incurred by the Indemnified Party in connection with any
defense or settlement of such asserted liability, except to the
extent set forth in the "provided that" clause in the immediately
preceding sentence and except to the extent such participation is
requested by the Indemnifying Party, in which event the
Indemnified Party is to be reimbursed by the Indemnifying Party
for reasonable additional legal expenses and out-of-pocket
expenses. If the Indemnifying Party desires to accept a final and
complete settlement of any such Third Person claim and the
Indemnified Party refuses to consent to such settlement, then the
Indemnifying Party's liability under the applicable indemnity
provision of this Agreement with respect to such Third Person
claim is limited to the amount so offered in settlement by such
Third Person and the Indemnified Party must reimburse the
Indemnifying Party for any additional costs of defense which it
subsequently incurs with respect to such claim and all additional
costs of settlement or judgment. If the Indemnifying Party does
not undertake to defend such matter to which the Indemnified
Party is entitled to indemnification hereunder, or fails
diligently to pursue such defense in good faith, the Indemnified
Party may undertake such defense through counsel of its choice,
at the cost and expense of the Indemnifying Party, such costs and
expenses to be paid or reimbursed by the Indemnifying Party on an
as-incurred basis, and the Indemnified Party may settle such
matter on a basis which is commercially reasonable under the
circumstances, and the Indemnifying Party must reimburse the
Indemnified Party for the amount paid in such settlement and any
other liabilities or expenses incurred by the Indemnified Party
in connection therewith. All settlements effected hereunder must
effect a complete release of the Indemnified Party with respect
to the Third Person claim unless the Indemnified Party otherwise
agrees in writing.
11.4 Indemnification Payments. The parties hereto will
make appropriate adjustments in the amount of indemnification payable
to an Indemnified Party for any Tax benefits or Tax detriments in
determining the amount of any indemnification obligation under
this Agreement.
11.5 Limitations. Notwithstanding any other provisions of
this Agreement to the contrary, no action for indemnification, breach
of contract, misrepresentation or any other claim for damages may
be brought by any party more than thirty-six (36) months after
the Closing Date.
11.5.1 On Buyer. Notwithstanding any provision to
the contrary contained herein, no claim for indemnification for
breach of this Agreement or any representation or warranty
hereunder may be made by Buyer against Seller unless or until the
aggregate amount for all such claims by Buyer against Seller
exceeds the Basket Amount.
11.5.2 On Seller. Notwithstanding any provision
to the contrary contained herein, no claim for indemnification for
breach of this Agreement or any representation or warranty
hereunder may be made by Seller against Buyer unless or until the
aggregate amount for all such claims by Seller against Buyer
exceeds the Basket Amount.
12. No Assurances. Buyer neither represents nor provides any
assurances to Seller that Buyer will develop the Project at all,
and if the Project is developed, Buyer does not represent that
the size of the Project, including the scope, Development Costs,
the operating costs or the Net Free Cash Flow will be as
projected or anticipated. Buyer may at any time elect to abandon
the Project, in its sole discretion, regardless of the effect of
such abandonment on Seller. Seller expressly acknowledges that
there are risks associated with the Project, that the Project may
not be developed and that if it is developed it may not provide a
positive Net Free Cash Flow. In no event shall this Agreement be
construed to confer on Seller any vested right to require that
the Project be developed or, if developed, that it be developed,
financed or operated in any particular way or be operated for any
particular length of time.
13. General Provisions.
13.1 Accounting Terms. All accounting terms not specifically
defined herein are to be construed in accordance with GAAP
(consistently applied) as in effect from time to time.
13.2 Amendment and Modification. No amendment, modification,
supplement, termination, consent or waiver of any provision of
this Agreement, nor consent to any departure therefrom, will in
any event be effective unless the same is in writing and is
signed by the Party against whom enforcement of the same is
sought. Any waiver of any provision of this Agreement and any
consent to any departure from the terms of any provision of this
Agreement is to be effective only in the specific instance and
for the specific purpose for which given.
13.3 Approvals and Consents. If any provision hereof requires
the approval or consent of any Party to any act or omission, such
approval or consent is not to be unreasonably withheld or delayed
except as set forth herein.
13.4 Assignments. Except as provided in Section 3.1.3 and
except for assignments, deeds of trust, security interests and other
transfers made to secure or collateralize Project-Related Debt,
no Party may assign or transfer any of its rights or obligations
under this Agreement to any other Person without the prior
written consent of the other Parties. Notwithstanding the
foregoing, Buyer may assign its rights and obligations under this
Agreement to any Affiliate of Buyer without the consent of
Seller; provided that such assignee executes and delivers to
Seller an assumption agreement in form and substance reasonably
satisfactory to Seller assuming all of Buyer's obligations
hereunder; and provided further that such assignment does not
release Buyer from its obligations hereunder for which such
assignee and Buyer shall be jointly and severally liable.
13.5 Business Day. If any day on which any payment is
required to be made hereunder, or on which any notice must be sent,
or on which any time period described herein commences or ends is
not a Business Day, then such day will be deemed for all purposes of
this Agreement to fall on the next succeeding day which is a
Business Day.
13.6 Captions. Captions contained in this Agreement and
the table of contents preceding this Agreement have been inserted
herein only as a matter of convenience and in no way define,
limit, extend or describe the scope of this Agreement or the
intent of any provision hereof.
13.7 Confidentiality. Each Party agrees to maintain as
confidential any Confidential Information that it may receive
from any other Party and may not disclose such information to any
Person without the prior written consent of the Party originally
providing such Confidential Information. However, a Party (the
"Disclosing Party") may disclose such Confidential Information:
(i) to legal counsel and other professional advisors of the
Disclosing Party (but only if they have been informed of the
confidential nature of such Confidential Information and agree in
writing to be bound by the terms of this Section); (ii) to
regulatory officials having jurisdiction over the Disclosing
Party or over any Permit (or application therefor) contemplated
herein; (iii) to Affiliates of Buyer and Seller; and (iv) as
required by law or legal process or in connection with any legal
proceeding to which the Disclosing Party is a party or is
otherwise subject, including, but not limited to, the application
process contemplated herein, but, in each such event, the
Disclosing Party, prior to such disclosure, is to inform the
Party originally furnishing such Confidential Information.
13.8 Counterpart Facsimile Execution. For purposes of
this Agreement, a document (or signature page thereto) signed and
transmitted by facsimile machine or telecopier is to be treated
as an original document. The signature of any Party thereon, for
purposes hereof, is to be considered as an original signature,
and the document transmitted is to be considered to have the same
binding effect as an original signature on an original document.
At the request of any Party, any facsimile or telecopy document
is to be re-executed in original form by the Parties who executed
the facsimile or telecopy document. No Party may raise the use
of a facsimile machine or telecopier or the fact that any
signature was transmitted through the use of a facsimile or
telecopier machine as a defense to the enforcement of this
Agreement or any amendment or other document executed in
compliance with this Section.
13.9 Counterparts. This Agreement may be executed by the
Parties on any number of separate counterparts, and all such
counterparts so executed constitute one agreement binding on all
the Parties, notwithstanding that all the Parties are not signatories
to the same counterparts.
13.10 Entire Agreement. This Agreement constitutes the
entire agreement among the Parties pertaining to the subject
matter hereof and supersedes all prior agreements, letters of
intent, understandings, negotiations and discussions of the
Parties, whether oral or written, including, but not limited to,
any financial projections or estimates of the Tax treatment of
the proceeds to be received by Seller from the transactions
contemplated under this Agreement that may have been prepared by
Buyer.
13.11 Exhibits. All of the Exhibits and Schedules
attached from time to time to this Agreement are deemed incorporated
herein by reference. Any Exhibits or Schedules not attached to
this Agreement at the time of its execution shall be negotiated,
agreed upon and attached to this Agreement not later than
February 7, 2000. Each party shall act in good faith with
respect to the completion and approval of such Exhibits and
Schedules.
13.12 Failure or Delay. No failure on the part of
any Party to exercise, and no delay in exercising, any right,
power or privilege hereunder operates as a waiver thereof, nor
does any single or partial exercise of any right, power or privilege
hereunder preclude any other or further exercise thereof, or the
exercise of any other right, power or privilege. No notice to or
demand on any Party in any case entitles such Party to any other
or further notice or demand in similar or other circumstances.
13.13 Further Assurances. The Parties will execute
and deliver such further instruments and do such further acts and
things as may be required to carry out the intent and purpose of
this Agreement.
13.14 Governing Law. This Agreement and the rights
and obligations of the Parties hereunder are to be governed by
and construed and interpreted in accordance with the laws of the
State of Missouri applicable to contracts made and to be
performed wholly within Missouri, without regard to choice or
conflict of laws rules.
13.15 Legal Fees, Costs. Except as otherwise provided
herein, all legal and other costs and expenses incurred in
connection with this Agreement and the transactions contemplated
hereby are to be paid by the Party incurring such costs and
expenses, In the event any Party brings suit or institutes
arbitration proceedings to construe or enforce the terms hereof,
or raises this Agreement as a defense in a suit or arbitration
proceeding brought by another Party, the prevailing Party in such
suit or arbitration proceeding is entitled to recover its
attorneys' fees and expenses.
13.16 Notices. Any notice or other communication
required or permitted to be given hereunder shall be in writing
and shall be mailed by registered or certified mail, postage prepaid,
return receipt requested, or delivered in person or by commercial
courier against receipt or by facsimile copy with confirmed
receipt, as follows:
if to Buyer:
AMERISTAR CASINO ST. LOUIS, INC.
ATTENTION: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
and with copies to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President of Legal Affairs
Ameristar Casinos, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, Mag & Fizzell, P.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to Seller:
FUTURESOUTH, INC.
ATTN: ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Riezman & ▇▇▇▇▇▇ PC
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as any Party may designate by notice to
the other Parties in accordance to the terms of this Section. Any
notice or other communication mailed by registered or certified
mail shall be deemed given at the earlier of the time of its
receipt by the addressee or three days after the time of mailing
thereof. Any notice or other communication given by any other
means shall be deemed given at the time of its receipt by the
addressee.
13.17 Publicity. Any publicity release, advertisement,
filing, public statement or announcement made by or at the
request of any Party regarding this Agreement or any of the
transactions contemplated hereby is to be first reviewed by and
must be reasonably satisfactory to the Buyer provided, however,
that Buyer may make disclosures in filings with the Securities
and Exchange Commission, The Nasdaq Stock Market, Inc. and gaming
regulatory authorities in Missouri, Nevada, Iowa and Mississippi
without prior notice to or the consent of Seller.
13.18 Schedules. To the extent necessary to correct,
modify or supplement the information contained herein, the Schedules
hereto may be replaced by mutually agreed upon replacement
Schedules.
13.19 Severability. If all or any portion of any
provision of this Agreement shall be held to be invalid, illegal
or unenforceable in any respect or in any jurisdiction, then such
invalidity, illegality or unenforceability shall not affect any
other provision hereof or thereof, and such provision shall be
limited and construed in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion thereof were not
contained herein or therein.
13.20 Specific Performance and Injunctive Relief.
Seller recognizes that, if it fails to perform, observe or discharge
any of its obligations under this Agreement, Buyer will suffer
irreparable damages and no remedy at law will provide adequate
relief to Buyer. Therefore, Buyer is hereby authorized to demand
and obtain specific performance of this Agreement, and is
entitled to temporary and permanent injunctive relief, in a court
of competent jurisdiction at any time when Seller fails to comply
with any of the provisions of this Agreement applicable to it.
To the extent permitted by Applicable Law, Seller hereby
irrevocably waives any defense that it might have based on the
adequacy of a remedy at law which might be asserted as a bar to
such remedy of specific performance or injunctive relief and
further waives any requirement that Buyer post any bond in
connection with any request for injunctive relief.
13.21 Submission to Jurisdiction. EXCEPT FOR MATTERS
SUBMITTED TO ARBITRATION IN ACCORDANCE WITH SECTION 14 HEREOF,
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY, OR ANY DOCUMENT RELATED
HERETO MAY BE BROUGHT IN THE COURTS OF THE STATE OF MISSOURI OR
ANY COURT OF THE UNITED STATES OF AMERICA FOR THE EASTERN
DISTRICT OF MISSOURI, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH PARTY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF
ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF
SUCH COURTS. THE PARTIES IRREVOCABLY WAIVE ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH ANY OF THEM MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING
IN SUCH RESPECTIVE JURISDICTIONS. NOTWITHSTANDING THE FOREGOING,
IN THE EVENT A LAWSUIT IS FILED, EACH PARTY RESERVES THE RIGHT TO
REMOVE THE LAWSUIT TO FEDERAL COURT. EACH PARTY IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OF ANY OF SUCH COURTS IN ANY
SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO EACH OF THE
OTHER PARTIES AT ITS ADDRESS PROVIDED HEREIN, SUCH SERVICE TO
BECOME EFFECTIVE 20 DAYS AFTER SUCH MAILING.
13.22 Successors and Assigns. All provisions of
this Agreement are binding upon, inure to the benefit of and are
enforceable by or against the Parties and their respective heirs,
executors, administrators or other legal representatives and
permitted successors and assigns.
13.23 Third-Party Beneficiary. This Agreement is soley
for the benefit of the Parties and their respective successors and
permitted assigns, and no other Person has any right, benefit,
priority or interest under, or because of the existence of, this
Agreement. Following the Closing, Seller shall not be deemed to
be a third party beneficiary of any covenant or provision of the
Lease.
13.24 Signature Warranty. Each Person executing this
Agreement warrants that he is authorized to do so on behalf of
the Party for whom he signs this Agreement.
13.25 Survival. All representations, warranties,
agreements and obligations of the Parties contained herein shall,
notwithstanding any investigation made by any Party hereto,
survive Closing and not be merged into any document delivered at
Closing. Notwithstanding any provision to the contrary contained
herein, the provisions of Sections 8, 11, 13.7, 13.10, 13.14,
13.15, 13.6, 13.17, 13.21 and 14 shall survive any termination of
this Agreement.
14. Arbitration.
14.1 Arbitration Proceedings. The parties desire to avoid and
settle without litigation disputes that may arise between them
relative to the Royalty provided in Section 3.1.2 and/or any
setoff pursuant to Section 7.12 herein. In the event the parties
are unable to resolve a dispute related to the Royalty or Seller
disputes any setoff by Buyer and timely files a notice of a
demand for arbitration as set forth in Section 7.12, then such
dispute shall be submitted to arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association ("Rules"). The hearing location shall be either the
City of St. Louis or St. Louis County, Missouri. The award
rendered by the arbitrator shall be final and binding as between
the parties and judgment on such award may be entered in any
court having jurisdiction thereof. A single neutral arbitrator
shall be appointed by the American Arbitration Association under
the Rules who shall be a certified public accountant. Notice of
a demand for arbitration of any dispute relating to the Royalty
shall be filed in writing with the other party(ies) and with the
American Arbitration Association. The parties agree that after
any such notice has been filed, they shall, before the hearing
thereof, make discovery and disclosure of all materials relative
to such dispute to the extent and in the manner provided by the
Rules and disclosure shall be completed no later than 30 days
after filing of such notice of arbitration unless extended by
such single arbitrator upon a showing of good cause by either
party to the arbitration or by consent of the parties to the
arbitration. The arbitrator may consider any material which is
relevant to the subject matter of such dispute even if the
material might also be relevant to an issue or issues not subject
to arbitration hereunder; provided, however, that the arbitrator
shall not have the power to modify the terms of this Agreement.
A stenographic record shall be made of the arbitration hearing,
which shall be held within ninety (90) days following the
delivery of the aforesaid notice of a demand for arbitration.
Each party shall pay its own costs of the arbitration and the
parties share equally the costs of the American Arbitration
Association and the arbitrator.
14.2 Limitation on Consolidation or Joinder. No arbitration
hereunder may include, by consolidation, joinder or any other
manner, any Person other than Buyer, Seller and other Persons
substantially involved in a common question of fact or law whose
presence is required if complete relief is to be accorded in
arbitration. Consent to arbitration involving an additional
Person does not constitute consent to arbitration of a dispute
not described therein or with a Person not named or described
therein. This Section 14 is enforceable by specific performance
under Applicable Law in a court of competent jurisdiction.
THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY
BE ENFORCED BY THE PARTIES.
IN WITNESS WHEREOF, the Parties have executed this Agreement
as of the date first set out above.
SELLER:
FUTURESOUTH, INC.,
a Missouri Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: President
SOUTHBOAT ▇▇▇▇▇, INC.,
a Nevada Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: President
SOUTHBOAT LIMITED PARTNERSHIP.,
a Missouri Limited Partnership
By: Southboat ▇▇▇▇▇, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: President
BUYER:
AMERISTAR CASINO ST. LOUIS, INC.,
a Missouri Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Authorized Agent
EXHIBIT D
AMENDED AND RESTATED
LEASE AND DEVELOPMENT AGREEMENT
THIS AMENDED AND RESTATED LEASE AND DEVELOPMENT
AGREEMENT (the "Lease") is made and entered into as of this 15th
day of February, 2000 (the "Effective Date"), by and between the
ST. LOUIS COUNTY PORT AUTHORITY, a public body corporate and
politic of the State of Missouri ("Landlord"), and SOUTHBOAT
LIMITED PARTNERSHIP, a Missouri limited partnership ("Tenant");
R E C I T A L S
A. Landlord is the owner, subject to the Exceptions
(defined below), of a certain approximately 80 acre parcel of
real estate, together with the structures thereon, located in the
Lemay area of St. Louis County, Missouri (the "County"), as
described on Attachment A (the "Property"), consisting of a
certain approximately 29 acre site depicted diagrammatically on
Attachment B (the "Premises") and an approximately 51 acre site
depicted diagrammatically on Attachment C (the "Adjacent
Parcel").
B. Landlord is a public body corporate and politic
duly organized and existing pursuant to Chapter 68 of the Revised
Statutes of Missouri and is charged with the responsibility of
developing the riverfront area of the unincorporated portion of
St. Louis County. In connection with such duties and
responsibilities, to promote the general welfare, to encourage
capital investment, and to increase the volume of commerce within
the ▇▇▇▇▇ area and of the County generally, Landlord has
determined that the Premises should be developed and operated as
a Casino (as hereinafter defined) with related uses (the
"Project").
C. Tenant submitted to Landlord and the St. Louis
County Council (the "Council") a certain Project proposal, which
Project proposal was modified and supplemented by subsequent
correspondence to Landlord and the Council (together, the
"Original Project Proposal").
D. In order to induce acceptance of the Original
Project Proposal by Landlord and the Council, Tenant agreed to
apply to the Missouri Gaming Commission (the "Commission") for
one or more licenses, as necessary, to operate the Project
(including the Casino) at and from the Premises ("Gaming
Licensure"), to pay certain rentals to Landlord in consideration
of the opportunity to develop and operate the Project, and to
designate the County as the "home dock" for the Project, all as
hereinafter set forth.
E. In order to further induce Landlord and the
Council to approve the Original Project Proposal, Showboat, Inc.,
a Nevada corporation ("Original Guarantor") and parent company of
Showboat ▇▇▇▇▇, Inc., a Missouri corporation and Tenant's general
partner (the "General Partner"), agreed to issue its
unconditional guarantees (together, the "Original Guarantees") of
(i) payment of the hereinafter specified minimum rent for 15
years (the "Original Rent Guarantee") and (ii) timely completion
of construction of and payment for all Project improvements and
installations (the "Original Completion Guarantee").
F. In order to promote the economic development of
the ▇▇▇▇▇ area and the County, and in consideration of the
Original Project Proposal, the financial incentives to Landlord,
the Original Guarantees, the special and unique qualifications of
the Original Guarantor in the development and operation elsewhere
of gaming projects, and the covenants and promises of the Tenant
and the Original Guarantor under this Lease and the Original
Guarantees, respectively, Landlord approved the Original Project
Proposal, and the Council enacted Ordinance Number 17,593, as
amended by Ordinance Number 17,739, in support of the Original
Project Proposal and the execution, delivery and performance of
this Lease.
G. Pursuant to the foregoing, Landlord and Tenant
entered into that certain Lease and Development Agreement, dated
as of October 13, 1995 (the "Original Effective Date"), as
amended by a First Amendment to Lease and Development Agreement,
dated as of May 21, 1996, a Second Amendment to Lease and
Development Agreement, dated as of December 12, 1996, a Third
Amendment to Lease and Development Agreement, dated as of
December 12, 1997, a Fourth Amendment to Lease and Development
Agreement, dated as of December 8, 1998, and a Fifth Amendment to
Lease and Development Agreement, dated as of September 20, 1999
(collectively, the "Original Lease").
H. The Investigation Date (as defined in the Original
Lease) did not occur prior to the Investigation Deadline (as
defined in the Original Lease), and pursuant to the
aforementioned Third Amendment to Lease and Development
Agreement, the Original Guarantor was released from its
obligations and liabilities to Landlord under the Original
Guarantees and the Original Guarantees were canceled.
I. In conjunction with the release and discharge of
the Original Guarantor and the cancellation of the Original
Guarantee, Landlord consented to the transfer of all of the stock
of the General Partner to Futuresouth, Inc., subject, however, to
the commitment of Tenant to secure the affiliation and support of
another entity meeting the Stated Criteria (as defined in the
Original Lease).
J. Subject to the terms and conditions set forth
herein, Tenant desires to assign and transfer to Ameristar Casino
St. Louis, Inc., a Missouri corporation ("Assignee"), all of
Tenant's right, title and interest in this Lease (the
"Assignment").
K. Assignee has filed its application for Gaming
Licensure with the Commission and has developed a revised Project
Proposal comprised of the preliminary construction documents
included in Attachment D-1 and the employment and contracting
policies included in Attachment D-2 (together, the "New Project
Proposal"), which Landlord has determined will, if implemented,
yield to Landlord, the County and the ▇▇▇▇▇ area the benefits
anticipated from the implementation of the Original Project
Proposal.
L. The parent corporation of Assignee, Ameristar
Casinos, Inc., a Nevada corporation ("New Guarantor"), will be
required, in connection with the Assignment, to provide to
Landlord, on or before the Commencement Date, a Guarantee of
Minimum Rent in the form of Attachment E (the "New Rent
Guarantee") and, in conjunction with the Assignment, a Guarantee
of Completion in the form of Attachment F (the "New Completion
Guarantee") (together, the "New Guarantees").
M. In consideration of and as a material inducement
to Landlord granting its consent to the Assignment, Tenant has
acknowledged and agreed that such consent shall be conditioned on
the execution and delivery to Landlord of a Lease Assignment and
Assumption Agreement between Tenant and Assignee in the form of
Attachment G (the "Assignment and Assumption Agreement") and,
from Southboat Limited Partnership, a Release of Landlord and St.
Louis County in the form of Attachment H (the "Assignment
Release").
N. In furtherance of the Assignment, Tenant has
requested that Assignee and New Guarantor, at their sole risk,
cost and expense, have access to the Premises from and after the
Effective Date for the purpose of conducting due diligence in
respect of the Premises and performing certain work incidental to
the proper conduct of due diligence and site preparation, and
Landlord has agreed to grant such right to Assignee and New
Guarantor, subject to the execution and delivery, by Landlord,
Assignee and New Guarantor of a License and Indemnity for Early
Entry onto the Premises in the form of Attachment I (the "Early
Entry License").
O. Landlord and Tenant desire to amend and restate
the Original Lease as set forth herein.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements of the parties contained herein,
Landlord and Tenant agree as follows:
1. Effectiveness of Lease and Assignment.
(a) Demise of Premises. Landlord and Tenant
acknowledge and agree that Landlord demised and leased the
Premises to Tenant, and that Tenant leased and took the Premises
from Landlord for the Term (as hereinafter defined), as of the
Original Effective Date, and that said demise and letting is
subject to all the terms and conditions of this Lease.
(b) Restatement and Amendment of Original Lease.
Upon the execution of this Lease by Landlord and Tenant, the
Original Lease shall be deemed fully restated and amended
pursuant to the terms hereof, as of the Effective Date.
(c) Landlord's Ownership. Landlord represents
and warrants to Tenant that Landlord is the owner of the Premises
subject to the following matters (collectively, the
"Exceptions"): (i) covenants, restrictions, easements, liens,
encumbrances and any other matters of record affecting the
Premises; (ii) present and future federal, state and local zoning
and land use laws, ordinances and restrictions affecting the
Premises, or the use thereof; (iii) any state of facts which an
accurate survey or an inspection of the Premises and the
Mississippi River would show; (iv) special assessments now or
hereafter becoming a lien against the Premises; and (v) general
property taxes and assessments for the current and subsequent tax
fiscal years affecting the Premises.
(d) The Assignment. Landlord hereby consents to
the Assignment, subject, however, to the full and timely
satisfaction of each of the following conditions:
(1) On or before the Investigation Deadline (as
defined herein), the Investigation (as defined herein) shall have
commenced and Landlord shall have received (a) from Tenant and
Assignee a fully executed Assignment and Assumption Agreement,
(b) from Southboat Limited Partnership a fully executed
Assignment Release, (c) from New Guarantor, the New Completion
Guarantee, and (d) from counsel to Assignee and New Guarantor, an
opinion confirming the corporate existence and good standing of
Assignee and New Guarantor, and the due authorization, execution
and delivery by Assignee and/or New Guarantor, as the case may
be, of their respective deliveries to Landlord, including without
limitation the certificate described in subparagraph (5) below.
(2) No default on the part of Tenant shall have
occurred and be continuing under any provision of this Lease.
(3) Assignee or New Guarantor, as the case may
be, shall have delivered true, accurate and complete copies to
Landlord of each and every environmental report, study, test,
investigation, evaluation or work performed or obtained by either
of them, or their respective employees, agents, contractors or
consultants, on or about the Premises.
(4) No failure on the part of Assignee or New
Guarantor, as the case may be, to comply with the following
requirements shall have occurred and be continuing as of the
effective date of the Assignment:
(a) Assignee or New Guarantor, as the case
may be, shall have obtained any required consent of
Landlord in connection with any partnership or
corporate transaction involving Assignee or the New
Guarantor which results in a change of control of the
Assignee or the New Guarantor, unless the transaction
involves the assignment of Assignee's rights under the
Assignment and Assumption Agreement to the New
Guarantor or to any corporation, partnership or limited
liability company controlling or controlled by the New
Guarantor or under common control with Assignee and
meeting the Stated Criteria (as defined in Section
12(b)) or unless any such transaction involving the New
Guarantor meets the Stated Criteria. The procedures
for approval of any proposed assignment requiring
Landlord's consent shall be the same as those set forth
in respect of any such transaction involving Tenant
under this Lease.
(b) Assignee shall have filed its
application for Gaming Licensure and shall not have
withdrawn or effectively abandoned such application
prior to the Investigation Deadline, and in no event
later than 30 days after the Effective Date, Assignee
shall have delivered to Landlord a copy of the
transmittal correspondence for such application to the
Commission, and, promptly thereafter, a copy of each
and every material notice delivered to or received from
the Commission by Assignee. As used in this subsection
(b), a "material notice" shall be any notice
substantively bearing upon the availability of Gaming
Licensure or the Site Permits (as hereinafter defined)
or affecting the occurrence of the Commencement Date or
Project Opening.
(c) Neither Assignee nor New Guarantor (nor
any permitted successor or assign) shall have filed a
voluntary petition in bankruptcy or shall have been
adjudicated bankrupt or insolvent or shall have filed
any petition or answer seeking any reorganization,
readjustment, liquidation, dissolution or similar
relief under any bankruptcy or insolvency statute or
law of the United States or any State, or shall have
sought or consented to or acquiesced in the appointment
of any bankruptcy or insolvency trustee, receiver or
liquidator of Assignee or New Guarantor of all or any
substantial part of either of their respective
properties; nor within 60 days after the commencement
of any involuntary proceeding against Assignee or New
Guarantor seeking reorganization, readjustment,
liquidation, dissolution or similar relief under any
bankruptcy or insolvency statute or law, Assignee or
New Guarantor, as the case may be, shall have failed to
secure a dismissal and discharge thereof.
(5) On the Assignment Date, Assignee and New
Guarantor shall each deliver to Landlord a certificate setting
forth, as to Assignee and New Guarantor, respectively, without
qualification, the same representations and warranties made by
the Tenant to Landlord in Section 8(a) (except that the
representation and warranty set forth in Section 8(a)(i) shall be
revised to reflect the correct type of entity and state of
organization of such entity). Landlord agrees, upon the request
of Tenant or Assignee, to deliver a certificate to Tenant and
Assignee, addressed to Tenant, Assignee and New Guarantor,
containing the same representations and warranties made by the
Landlord to Tenant in Section 8(b); provided, however, that
Landlord shall have no liability to any party whatsoever in the
event that, as a result of any event first occurring subsequent
to the Effective Date, the representation and warranty contained
in Section 8(b)(iii) cannot be made without qualification.
(e) Upon satisfaction of each and every condition set
forth in Section (d)(1) through (5), the effective date of the
Assignment (the "Assignment Date") shall be deemed to have
occurred, Assignee shall have succeeded to all right, title and
interest of Southboat Limited Partnership under this Lease and
for all purposes herein shall be deemed the "Tenant" under this
Lease, the New Guarantor shall be bound under the New Guarantees,
and Southboat Limited Partnership, having delivered the
Assignment Release, shall be released from any obligation or
liability to Landlord accruing under this Lease subsequent to the
Assignment Date.
(f) In the event that prior to the Investigation
Deadline either Tenant or Assignee shall notify Landlord in
writing that the Assignment will not occur in accordance with the
requirements of this Agreement, or in the event, for any reason,
the Assignment shall fail to occur on or before the Investigation
Deadline, this Lease shall be of no further force or effect and
Landlord shall have no obligation or liability to Tenant or
Assignee in respect of the proposed Assignment; provided,
however, that in such event, the Original Lease shall be deemed
automatically reinstated, ratified and reconfirmed by the
parties. Nothing contained in this Lease shall be construed as
creating any privity of estate between Landlord, on the one hand,
and Assignee or New Guarantor, on the other hand, or any
liability or obligation on the part of Landlord to New Guarantor
or to Assignee prior to the Assignment Date except as expressly
set forth in the Early Entry License, and except for enforcement
of the rights granted New Guarantor and Assignee under the Early
Entry License, neither New Guarantor nor, prior to the Assignment
Date, Assignee, shall have any right, standing or privilege to
enforce any obligation of Landlord under this Lease, whether
directly or by assignment from Tenant, or in the name, place or
stead of Tenant, or, except as to the obligations of Landlord
under Section 1(d), as a putative third-party beneficiary of the
rights or privileges of Tenant under this Lease. Nothing
contained in this Section 1(f), however, shall be deemed to limit
Tenant's rights under this Lease.
2. Tenant's Due Diligence and Pre-development Work.
(a) As-Is Delivery of Premises. Except as
expressly provided in this Lease, Landlord makes no
representation and provides no warranty to Tenant or Assignee of
any kind whatsoever regarding (i) the existence or nature of any
Exceptions, (ii) the condition of the Premises or the Mississippi
River (including, without limitation, any environmental matters),
(iii) the suitability of the Premises for any aspect of the
Project, or (iv) the feasibility of Tenant's development and
operation of the Project on, at or from the Premises. Tenant
acknowledges receipt from Landlord of the following: (i) an
owner's policy of title insurance dated October 9, 1987 relating
to the Property and issued by Ticor Title Insurance Company;
(ii) a survey dated July 7, 1987 relating to the Property and
prepared by Pitzman's & Co. Surveyors and Engineers, and
(iii) certain environmental reports and studies conducted in
respect of the Property dated January 30, 1981, March 12, 1981,
January 1986 and June 1986, respectively, and prepared by
Envirodyne Engineers, Inc. Tenant acknowledges that such
materials have been provided solely for informational purposes to
assist Tenant in Tenant's due diligence, that the same do not
constitute representations or warranties by Landlord or the
County, and that Tenant shall rely on Tenant's own evaluations,
inspections and testing of the Premises in determining the
suitability of the Premises and the feasibility of the Project.
The foregoing provisions of this Section 2(a) shall be binding on
Assignee as of the Assignment Date.
(b) Tenant's Access to Premises. Tenant shall
continue to have access to the Premises at any and all times
after the Effective Date and prior to the Assignment Date. The
access of Assignee and New Guarantor to the Premises prior to the
Assignment Date shall be subject to the terms and conditions of
the Early Entry License.
(c) Zoning Condition. At the written request of
Assignee, which request shall be delivered by Tenant to Landlord
not later than 60 days after the Effective Date, Landlord shall
apply to the County Planning Commission for an amendment to the
existing "C-8" classification of the Premises so as to enable
Assignee to construct and operate the Project at and from the
Premises in accordance with the New Project Proposal; provided,
however that Landlord shall not be obligated to incur any out-of-
pocket or third-party costs and expenses in connection with such
application. Tenant shall provide to Landlord or shall cause
Assignee to provide to Landlord such information and
documentation as may be necessary and appropriate to enable
Landlord to apply for the rezoning. In the event the Premises is
not so rezoned (or, if so rezoned, in the event the conditions of
such rezoning are not acceptable to Tenant or Assignee in its
discretion) pursuant to County ordinance prior to the later to
occur of that date which is 180 days after the Effective Date or
that date which is 120 days after the filing of the application
by Landlord (the "Rezoning Deadline"), Tenant shall have the
option, if exercised by delivery of written notice to Landlord
delivered prior to the Rezoning Deadline, to cancel this Lease
without further obligation or liability on the part of either
party to the other; provided, however, that if the aforementioned
rezoning has not occurred on or prior to the Rezoning Deadline
notwithstanding the reasonably diligent efforts of the parties to
secure the rezoning, either party shall have the right to extend
the Rezoning Deadline for an additional period of 60 days.
Tenant shall be responsible for providing or for causing Assignee
to provide to the County Planning Commission all information
required of Tenant or Assignee, as the case may be, by the County
Planning Commission.
(d) Acceptance of Premises. Tenant hereby
accepts the Premises "AS IS", subject only, if applicable, to
(i) the occurrence of the Commencement Date, as defined in
Section 3(a), and (ii) any termination of this Lease occurring
pursuant to the provisions hereof. From and after the Original
Effective Date, Landlord shall not subject, and shall not have
subjected, the Premises to any liens or encumbrances not
expressly permitted by this Lease without the prior written
consent of Tenant. The foregoing provisions of this Section 2(d)
shall be binding on Assignee as of the Assignment Date.
3. Term of Lease.
(a) Commencement Date. The term of this Lease
(the "Term") shall commence (the "Commencement Date") if at all,
at such time as the following have occurred: (i) the Assignment;
(ii) the Missouri Gaming Commission (the "Commission") commences
the investigation of Assignee (the "Investigation") incident to
Assignee's application for Gaming Licensure to operate the
Project in accordance with the New Project Proposal (the
"Investigation Date"); (iii) Assignee has obtained all Site
Permits (as defined in Section 3(b)) (the "Site Permit Date");
and (iv) the New Guarantor shall have executed and delivered to
Landlord the New Rent Guarantee, together with an opinion of
counsel confirming the corporate existence and good standing of
New Guarantor, and the due authorization, execution and delivery
by New Guarantor of the New Rent Guarantee. The Term shall
expire on the 99th anniversary of the day prior to the
Commencement Date. Each successive 12 month annual period
occurring subsequent to the Commencement Date shall be deemed a
"Lease Year" for all purposes under the Lease. Landlord and
Tenant shall each execute a memorandum prepared by Landlord and
reasonably acceptable to Tenant confirming the Commencement Date
of this Lease, such memorandum to become an attachment to this
Lease.
(b) Site Permits and Gaming Licensure. As used
in this Lease, the term "Site Permits" shall mean all permits or
licenses issuable by the U.S. Army Corps of Engineers (the
"Corps") or by other governmental bodies to enable Tenant to
commence dredging of the Mississippi River, and for site
development, grading and excavation work on the Premises,
including, without limitation, the Corps' Section 10 and 404
Permits, a flood plain development permit, a metro sewers and
highway permit and a site plan approval permit, but excluding any
building or construction permits required to enable Tenant to
commence or complete the construction of Tenant's Project
improvements or to occupy and operate the Project. Tenant shall
make application for all Site Permits at the earliest practical
opportunity consistent with the status from time to time of the
Investigation. Tenant and Assignee shall use all reasonable
efforts under the circumstances to obtain the Site Permits and
Gaming Licensure, and Landlord shall fully and actively support,
endorse and diligently assist Tenant and Assignee in such
efforts, provided Landlord shall not be obligated to incur any
out-of-pocket or third party expenses for Tenant's or Assignee's
benefit or pay any monies to Tenant or Assignee. From and after
the Assignment Date, Tenant shall deliver to Landlord a copy of
each and every material notice delivered to or received from the
Commission by Tenant. As used in this subsection (b), a
"material notice" shall be any notice substantively bearing upon
the availability of Gaming Licensure or the Site Permits or
affecting the occurrence of the Commencement Date or Project
Opening. Without the prior written consent of Landlord, such
consent not to be unreasonably withheld or delayed, Tenant shall
not withdraw Tenant's application for any of the Site Permits or
for Gaming Licensure prior to any termination of this Lease.
(c) Early Defeasance of Lease. Landlord or
Tenant shall have the right to terminate this Lease pursuant to
subsection (d) if, for any reason other than an Unavoidable Delay
(as defined in Section 30) or a delay caused by Landlord or the
County, any of the following conditions occur:
(i) notwithstanding Tenant's or Assignee's
diligent pursuit of Gaming Licensure, if the
Investigation Date has not occurred on or
before August 15, 2001 (the "Investigation
Deadline") or Tenant or Assignee reasonably
determines, based on communications with or
information received from the Commission
staff, that the Commission will not commence
the Investigation before the Investigation
Deadline; or
(ii) the Site Permit Date has not occurred on or
before the expiration of the 9 month period
commencing on the Investigation Date (the
"Site Permit Deadline") or the Corps
officially notifies Tenant or Assignee that
it will not permit the construction or
operation of the Project as contemplated in
this Lease; provided, however, in the event
(i) the Investigation Date has timely
occurred, (ii) Tenant or Assignee has
obtained all Site Permits other than the Site
Permits to be issued by the Corps (or
issuance of the remaining Site Permits is
contingent solely on issuance of the Corps'
Site Permits), and (iii) the Corps has not
officially notified Tenant or Assignee that
it will not permit the operation of the
Project at the Premises, Tenant or Assignee
shall have the option to extend the Site
Permit Deadline for 3 successive periods of
60 days each by delivery of written notice of
such election to Landlord not sooner than 30
days prior to, and not later than, the Site
Permit Deadline; provided, however, Tenant or
Assignee has made diligent efforts to secure
the Site Permits to be issued by the Corps
and has cooperated with the Corps by
responding in a reasonably timely fashion to
requests for information or proposed plan
changes from the Corps.
(d) Termination Notice. Termination of this
Lease pursuant to Section 3(c) shall be accomplished by delivery
of written notice to the non-terminating party of such election
on or before the Investigation Deadline or the Site Permit
Deadline, as the case may be (a "Termination Notice"); provided,
however, that no such Termination Notice shall be effective
unless the terminating party shall have sent an initial notice
advising the non-terminating party of its intent to terminate
this Lease at least 30 days prior to the date of the Termination
Notice and the cause or grounds for such termination have not
been cured during such 30-day period.
(e) Post-Commencement Date Defeasance. From and
after the Commencement Date, this Lease may be terminated by
Tenant solely upon the discovery of any hazardous waste,
pollutant, toxic pollutant, hazardous substance, toxic substance,
infectious waste, solid waste or similar material or substance
requiring abatement, removal, remediation or other special
treatment in order to comply with applicable law (collectively,
"Hazardous Substances") beneath the surface of the Premises not
detected by or otherwise made known in writing to Assignee or New
Guarantor prior to the Assignment Date, and costing more than
$3,000,000 to remediate, or upon the repeal, invalidation or
material adverse amendment of the law or regulations permitting
and/or regulating gaming in the State of Missouri and consequent
cessation of Tenant's business at the Premises, or upon the
occurrence of a casualty or condemnation, all in accordance with
the applicable provisions of Sections 4(g), 11(c), 15 or 16,
respectively.
4. Project Construction and Development.
(a) Submission and Approval of Plans. Prior to
commencement of the work for the construction and development of
the Project on the Premises (the "Work"), Tenant shall submit or
shall cause Assignee to submit to Landlord for Landlord's
approval, a final site plan, footprints, utility plans, exterior
renderings, elevations and offsite improvement plans (together,
the "Plans") and a proposed schedule of the Work (the "Work
Schedule"), including the barge-based gaming facility and related
installations for dockside gaming at the Premises (together, the
"Casino"). Landlord's approval of the Plans and Work Schedule
shall not be unreasonably withheld or delayed. In all events,
Landlord shall approve or disapprove any proposed Plans within 10
business days after Landlord's receipt of same, and any
disapproval shall be specific as to the reasons. Tenant, or,
prior to the Assignment Date, Assignee, shall be given adequate
time and opportunity to correct such matters which Landlord has
identified as the basis for such disapproval. If Landlord does
not approve or disapprove such Plans within 10 business days
after submission by Tenant or Assignee, as the case may be, then
such Plans shall be deemed approved for all purposes under this
Agreement. Landlord agrees that the Premises shall be subject to
any utility easements referenced in the approved Plans and to
execute such easement agreements for the benefit of the Project.
Landlord's approval of the Plans shall not be deemed to
constitute acceptance by Landlord of any liability in connection
with the Plans or the Work, such liability and risk being
expressly and exclusively borne by Tenant. The procedures set
forth in this Section 4(a) shall apply with respect to any
changes to the approved Plans or Work Schedule proposed by Tenant
or Assignee, as the case may be.
(b) Construction and Occupancy Permit
Applications. Tenant, at Tenant's sole cost and expense, shall
apply for all permits required to enable Tenant to commence and
complete the construction of Project improvements (the
"Construction Permits") and to occupy and operate the Project
(the "Occupancy Permits"), and Tenant shall prepare all
engineering and construction documents required to apply for or
comply with the terms of any Construction Permit. Landlord shall
endorse and support Tenant's Permit applications to the extent
the same are materially consistent with the approved Plans;
provided Landlord shall not be required to incur any out-of-
pocket or third-party costs or expenses in connection therewith.
(c) Delivery of Premises. The Premises shall be
made available to Tenant for commencement of the Work from and
after the Commencement Date, provided Tenant has first obtained
such Permits (Site Permits or Construction Permits, as the case
may be) as are necessary for commencement of the applicable Work,
executed and delivered the necessary construction contracts,
established the construction disbursing escrow and delivered to
Landlord the insurance certificates, contract assignments,
consents and bonds provided for in Section 4(e). Prior to
commencing any Work on or at the Premises, Tenant, at Tenant's
sole risk, cost and expense, shall cause a resubdivision plat and
revised legal description of the Premises to be prepared by a
licensed Missouri surveyor in accordance with Attachment B and
submitted to Landlord for Landlord's review and approval, which
approval shall not be unreasonably withheld. The legal
description of the Premises shall become Attachment J to this
Lease. The resubdivision plat shall be sufficient to enable
Landlord to cause the Premises to be lawfully subdivided from the
Adjacent Parcel and shall be consistent with Tenant's
contemplated ingress and egress by the public to the Project and
Tenant's access to service roads and work areas as shown on the
Project design plans and renderings. Landlord agrees to
cooperate fully with Tenant in connection with Tenant's
preparation of the legal descriptions and resubdivision plat, but
at no out-of-pocket or third-party cost or expense to Landlord,
except that Landlord shall bear the cost of any surveying of the
Adjacent Parcel required to effect the resubdivision and any
other resubdivision costs allocable to the Adjacent Parcel, with
any such allocation between Tenant and Landlord to be based on
the relative size of the parcels unless the cost in question
relates solely to one parcel.
(d) Coordination and Inspection of Work.
Landlord shall have the right to inspect and monitor the progress
of the Work during regular business hours, on reasonable prior
notice to Tenant and without material interference with the Work.
Tenant shall advise Landlord as to any material claim pending or
threatened by or against Tenant or otherwise involving the
Project and of any anticipated delays in Project Opening. Within
30 days after the Commencement Date, Tenant and Landlord shall
each designate one or more "Project Representatives" who shall
provide liaison services between the Tenant and contractors and
consultants working on the Project on one hand and Landlord and
officials and departments of the County on the other. The
Project Representatives shall confer by telephone and fax
communication, and shall meet with each other regularly or
otherwise on reasonable prior request for the purpose of
conveying and obtaining information and approvals required in
connection with the Work. Notices provided by Project
Representatives shall be sent and received in accordance with the
provisions of Section 29 regarding delivery of Notices.
(e) The Work. After the Commencement Date,
Tenant shall proceed with reasonable diligence to obtain all
Construction Permits not theretofore obtained by Tenant, to
commence and complete the Work in accordance with the Plans and,
subject only to Unavoidable Delays and delays caused by Landlord
or the County, the Work Schedule, and to obtain all Occupancy
Permits and to open the Project (including the Casino) to the
public ("Project Opening"). All Work shall be performed by
Tenant at the sole risk, cost and expense of Tenant (i) in a
first class, workmanlike manner, (ii) free of liens for labor and
materials (subject to Tenant's right to contest liens as provided
in this Lease), (iii) subject to commercial liability, builder's
risk and worker's compensation insurance coverage required under
this Lease, (iv) free of all other claims against Landlord or the
Project (subject to Tenant's right to contest liens as provided
in this Lease), (v) in compliance with the Permits and all
applicable laws, regulations, ordinances and codes ("Governmental
Requirements"), and (vi) as to the Work performed on the Premises
only, subject to construction disbursing escrows with properly
qualified and licensed contractors (collectively, the "Work
Requirements"). Tenant shall be responsible for timely delivery
to Landlord of all insurance certificates, construction
contracts, construction disbursing escrows, collateral
assignments of construction contracts and the contractors'
consents thereto. Tenant shall deliver to Landlord a certificate
of Substantial Completion of the Work issued by Tenant's
architect, and Tenant shall provide evidence of payment of all
construction costs. As used herein, "Substantial Completion"
shall mean that only insubstantial details of finish construction
and installation remain to be performed, and that the Project may
nonetheless be opened to the public. Tenant agrees that all
punch-list items shall be completed as soon as reasonably
practical and in no event later than 180 days after Substantial
Completion. Tenant shall deliver to Landlord a certificate of
Final Completion issued by Tenant's architect and evidencing the
completion of all punch-list items.
(f) Control of Work. Landlord and Tenant agree,
subject to the provisions of the New Project Proposal applicable
to the employment or engagement of local persons or companies,
minorities and women or companies owned by minorities and women,
which provisions are hereby incorporated into this Lease by this
reference, and subject further to applicable Governmental
Requirements, that performance of the Work shall be subject to
the following terms and conditions: (i) Tenant shall have the
sole and exclusive right to select any architect, construction
manager, general contractor and engineer in connection with the
design and construction of the Project; (ii) Tenant shall have
the sole and exclusive right to select any additional
subcontractors, materialmen, suppliers or any other persons or
companies in connection with the construction of the Project; and
(iii) Tenant shall have the sole and exclusive right to manage,
direct, control, coordinate and prosecute the completion of the
Project, and Landlord shall cooperate fully in such regard, but
at no cost or expense to Landlord.
(g) Undetected Contamination. In the event
Tenant, after commencement of the Work and not later than the
date of Project Opening, discovers Hazardous Substances beneath
the surface of the Premises which were not detected prior to the
Effective Date or, if detected, the extent of which was not fully
ascertained by any "Phase II" work or testing performed prior to
the Effective Date (the results of which were made known in
writing to Assignee or New Guarantor) or which were not otherwise
disclosed to Assignee or New Guarantor in writing prior to the
Assignment Date, and in the event the cost to remediate such
Hazardous Substances shall equal or exceed $3,000,000, Tenant
shall have the option, by delivery of written notice to Landlord
within 90 days after Tenant's discovery of such Hazardous
Substances, accompanied by a written bid of Tenant's contractor
confirming such $3,000,000 or greater remediation cost, to
terminate this Lease without further obligation or liability to
Landlord, such termination to take effect no earlier than the
date Tenant shall have (i) paid all costs incurred by Tenant in
connection with the Work, (ii) installed warning signs and
perimeter fencing to secure access to any area made dangerous by
Tenant's excavations, and (iii) surrendered the Premises to
Landlord, free and clear of Tenant's construction equipment and
materials, but otherwise "AS IS." Landlord shall not be
obligated to refund to Tenant the Commencement Date Fee (defined
in Section 5(a)(i)) or any prepaid Annual Rent, and Landlord's
agreement with respect to the cure of any objection raised by
Tenant shall be void and of no further force or effect. Tenant
shall provide Landlord with copies of all reports, test results
and evaluations of Hazardous Substances discovered beneath the
Premises.
(h) Project Opening. Upon, and as a condition
to, Project Opening, Tenant shall pay the Project Opening Fee
described in Section 5(a)(ii). On or before the date of Project
Opening, the parties shall execute a memorandum prepared by
Landlord and reasonably acceptable to Tenant establishing the
Project Opening date (and the date payments of Minimum Rent or
Percentage Rent, as the case may be, shall be due under Section
5), which memorandum shall become an attachment to this Lease.
(i) Relocation of Sewer Line. Landlord hereby
agrees to the relocation of the sewer line running west to east
across the Premises if requested by Tenant in accordance with
plans approved by MSD and to grant MSD an easement as reasonably
necessary to accommodate such relocation, and Tenant hereby
agrees to provide for all costs related to the inspection and
removal, relocation or replacement of such sewer line.
(j) Provision for Additional Wetland Areas.
Landlord hereby agrees to designate wetland areas to replace the
wetland areas located on the Premises and Tenant hereby agrees to
pay for any costs associated with the replacement of the wetland
areas located on the Premises.
(k) Right-of-Ways. Landlord will use its best
efforts, not including litigation, to cause St. Louis County to
vacate the right-of-way for the extension of ▇▇▇▇▇ Avenue upon
the dedication to St. Louis County of the extension of
▇▇▇▇▇▇▇▇▇▇▇ Avenue contemplated by Tenant; provided, however,
that it is understood and agreed that Landlord shall be entitled
to dedicate to St. Louis County a right-of-way up to 82 feet wide
on the Premises for the future northward extension of the
▇▇▇▇▇▇▇▇▇▇▇ Avenue Extension. Tenant agrees to take all action
reasonably necessary to effectuate such dedication and to allow
for the construction of such northward extension.
5. Rent.
(a) Key Date Payments and Annual Rent. Tenant
shall pay to Landlord, without setoff or deduction, by corporate
or cashiers check or by wire transfer to such account as may be
directed by Landlord in immediately available U.S. funds, the
following rentals (collectively, "Rent"):
(i) $2,500,000 on the Commencement Date (the
"Commencement Date Fee");
(ii)$2,500,000 on the date of Project Opening
(the "Project Opening Fee"); and
(iii)as annual rent ("Annual Rent"),
(A) commencing on the Commencement Date and
continuing until the date of Project
Opening, $2,000,000 per annum, payable
in equal monthly installments, and
(B) commencing on the date of Project
Opening and continuing until the
expiration of the Term or, subject to
Section 25, termination of the Lease,
the greater of (a) 4% of Adjusted Gross
Receipts ("AGR") ("Percentage Rent") or
(b) applicable Minimum Rent.
(b) Minimum Rent. As used in this Lease, the
term "Minimum Rent" shall mean $3,000,000 during the 1st 12 month
period occurring after Project Opening, $2,800,000 during the 2nd
12 month period occurring after Project Opening, $2,600,000
during the 3rd 12 month period occurring after Project Opening,
$2,400,000 during the 4th 12 month period occurring after Project
Opening, $2,200,000 during the 5th 12 month period occurring
after Project Opening, and $2,000,000 commencing on the 5th
anniversary of the date of Project Opening and continuing through
Lease Year 15. Minimum Rent shall be increased by 10% on the
first day of each successive 10th Lease Year occurring during the
Term, commencing with Lease Year 16.
(c) Payment of Annual Rent. From the
Commencement Date until the date of Project Opening, Annual Rent
shall be paid in equal monthly installments, with each
installment equal to 1/12th of the applicable Minimum Rent. From
and after the date of Project Opening, Annual Rent shall be paid
on a monthly basis as provided in Section 5(a)(iii)(B). In the
event the Commencement Date, the date of Project Opening, or the
date the Term expires occurs on a date which is not the first day
of a month, the relevant monthly installment of Annual Rent shall
be prorated per diem, based on the number of days of such month
included within the applicable Rent period. Payments of Annual
Rent shall be subject to quarterly adjustment as provided in this
subsection (c) in the event and to the extent Minimum Rent
accruing for such quarterly period is exceeded by Percentage Rent
(4% x AGR) accruing for such quarterly period. As used in this
Lease, the term "Adjusted Gross Receipts" or "AGR" shall mean the
gross receipts from licensed gambling games and devices less
winnings paid to wagerers and the 20% tax paid to the State of
Missouri pursuant to Section 318.822 of the Revised Missouri
Statutes. In the event Percentage Rent exceeds Minimum Rent
during any quarter, Tenant shall pay such difference to Landlord,
as an adjustment to Minimum Rent, not later than 45 days after
the end of each quarter. At the end of each Lease Year, Tenant
shall be entitled to a credit against Rent next due to the extent
of any overpayments of Percentage Rent made by Tenant during such
Lease Year. Tenant shall report AGR to Landlord on a quarterly
basis in accordance with the provisions of Section 13.
6. Triple Net Obligation. The Lease shall be what is
commonly known as a "Triple Net" Lease, and Tenant shall be
responsible for the full and timely performance of all
obligations and payment of all costs, charges, fees, expenses and
other sums incurred by or for Tenant's benefit in connection with
Tenant's ownership, leasing, construction, development,
equipping, management, maintenance, repair, replacement,
operation or use of the Project or any component thereof,
including without limitation all salaries, fees, commissions,
rentals, license or permit fees, loan or mortgage payments,
utility charges, trash, sewage and waste water disposal charges,
fuel charges, insurance premiums and deductibles, and all general
real estate, ad valorem, sales, use and other taxes and
assessments, special or general, allocable to the Premises, the
Project or the leasehold estate of Tenant. All sums other than
Rent payable by Tenant hereunder, including without limitation
the amounts due Landlord pursuant to this Section 6 (whether
directly or by reimbursement of any sum paid by Landlord to a
third party in the cure of a default by Tenant as permitted under
this Lease) shall be deemed "Additional Rent" as to which
Landlord shall have the same rights and remedies for enforcement
of payment and collection as Landlord has in respect of Rent.
7. INTENTIONALLY OMITTED.
8. Representations and Warranties.
(a) In order to induce Landlord to enter into
this Lease, Tenant makes the following representations and
warranties to Landlord, as of the Effective Date:
(i) Tenant is duly formed and validly existing as
a Missouri limited partnership;
(ii) the execution and delivery of this Lease and
the performance by Tenant of Tenant's
obligations hereunder have been duly
authorized by all requisite corporate action;
(iii)this Lease constitutes the legal, valid and
binding obligation of Tenant and is
enforceable against Tenant in accordance with
its terms;
(iv) no litigation is pending or, to the best of
Tenant's knowledge, threatened against Tenant
which, if adversely determined, would likely
have a material adverse impact on Tenant or
the Project;
(v) Tenant is not a party to, and neither Tenant
nor Tenant's properties, real or personal,
are subject to, any agreement, order,
proceeding, ruling or other matter in
conflict with any provision of this Lease or
which materially and adversely affects its
ability to perform its obligations hereunder;
(vi) Tenant is solvent and is not a party to any
assignment for the benefit of creditors or
bankruptcy proceeding; and
(vii)Tenant is not in material default of any
contract or agreement to which it is a party
which materially and adversely affects
Tenant's ability to perform its obligations
under this Lease.
(b) In order to induce Tenant to enter into this
Lease, Landlord makes the following representations and
warranties to Tenant as of the Effective Date:
(i) Landlord is a corporate and political body
lawfully existing and in good standing under
the laws of the State of Missouri and has the
power and authority to enter into this Lease,
and the execution and delivery of this Lease
and the performance by Landlord of Landlord's
obligations hereunder have been duly
authorized by all requisite governmental
action;
(ii) this Lease constitutes the legal, valid and
binding obligation of Landlord and is
enforceable against Landlord in accordance
with its terms;
(iii)no litigation is pending or, to the best of
Landlord's knowledge, threatened against
Landlord which, if adversely determined,
would likely have a material adverse impact
on the Project;
(iv) Landlord is solvent and is not a party to any
assignment for the benefit of creditors or
bankruptcy proceeding;
(v) Landlord is not a party to any agreement,
order, proceeding, ruling or other matter in
conflict with any provision of this Lease;
and
(vi) Landlord is not in default of any contract or
agreement to which it is a party which
materially and adversely affects its ability
to perform its obligations under this Lease.
(c) Each party agrees to promptly notify the
other of any occurrence which shall make any representation or
warranty provided by it as of the Effective Date no longer true,
accurate or complete in any material respect.
9. Use of Premises and Quiet Enjoyment.
(a) Designated Use. Tenant shall use the
Premises for the operation of a Casino and for related,
supporting infrastructure, including without limitation a parking
lot, lighting, signage and such additional installations as are
required by Tenant in connection therewith. In addition to the
Casino, Tenant or its permitted subtenants may (but shall not be
obligated to) develop and operate on the Premises such
restaurants, bars, hotels, bowling alleys, movie theaters, stores
and/or other facilities, as Tenant may in its discretion
determine, provided, however, that in all events the Casino shall
contain a minimum of 26,000 square feet of Las Vegas style gaming
area.
(b) Alterations and Improvements. Subject to the
provisions of Section 9(a), Tenant may from time to time, at
Tenant's sole risk, cost and expense, make alterations and
improvements, (i) without Landlord's prior written consent, to
the interior, non-structural components of the Premises which do
not reduce the minimum square footage devoted to Casino gaming,
and (ii) with Landlord's prior written consent, which consent
shall not be unreasonably withheld or delayed, to the exterior or
structural components of the Project; provided, however, that
Landlord shall not be required to consent to any reduction in the
square footage of the Project devoted to Casino gaming. In the
event of a dispute between the parties as to whether Landlord's
consent is required or has been unreasonably withheld, the issue
shall be submitted to binding arbitration in accordance with the
procedures of Section 31. In order to rule in favor of Landlord,
the arbitrators must determine that such proposed new
construction would be detrimental to the Project and Landlord's
realization of the benefits of this Lease.
(c) Compliance With Governmental Requirements.
During the Term, Tenant shall, at its sole cost and expense,
promptly observe and comply with all Governmental Requirements
and the requirements of all insurance companies writing policies
covering the Casino or the parking areas, streets, sidewalks,
vaults, curbs and gutters included within the Project, or the use
and occupation or franchises and privileges connected therewith,
whether or not such Governmental Requirements or insurance
requirements shall necessitate structural changes, improvements,
interference with the use and enjoyment of the Project,
replacements or repairs, extraordinary as well as ordinary,
foreseen or unforeseen. The Casino shall be located within the
Project in such a manner so as not to violate any applicable
Gaming Licensure requirements of the Commission or any Permits
obtained by Tenant. Tenant shall pay all costs, expenses,
claims, fines, penalties and damages that may in any manner arise
out of or be imposed because of the failure of Tenant to comply
with any of the foregoing requirements.
(d) Permitted Contests. Tenant, after notice to
Landlord, may, by appropriate legal proceedings conducted at
Tenant's sole expense, contest in good faith the validity or
enforcement of any Governmental Requirement and may defer
compliance therewith, provided that (i) such noncompliance shall
not constitute a crime, (ii) Tenant shall diligently prosecute
such contest to final determination by a court, governmental
authority, agency, department or other body having final
jurisdiction, (iii) the contest conducted by Tenant will not
operate to extend the Investigation Deadline or the Permit
Deadline, and (iv) the contest conducted by Tenant will not
result in the closing of the Project, any foreclosure or
forfeiture of Tenant's leasehold estate or the imposition of any
charge, fine, lien, penalty or claim against Landlord. Tenant,
after notice to Landlord, may, by appropriate legal proceedings
conducted at Tenant's sole expense, contest in good faith the
validity of any lien for labor or materials imposed against
Tenant or the Project, provided that Tenant first discharges such
lien from the records of the County by posting of bond or other
security reasonably adequate to secure Tenant's performance, and
provided further that such contest will not result in the closing
of the Project or any foreclosure or forfeiture of Tenant's
leasehold estate.
(e) Quiet Enjoyment. Landlord covenants and
agrees that Tenant shall be entitled to lawfully and quietly
hold, occupy and enjoy the Premises during the Term without
hindrance or interference by Landlord or by any party claiming
by, through or under Landlord, in accordance with and subject to
the terms and conditions of this Lease.
10. Exclusivity and Restrictive Covenant.
(a) Grant of Exclusivity. To the fullest extent
permitted by law, and subject only to the provisions of Section
10(b), Landlord hereby grants to Tenant and its permitted
successors and assigns, for a period commencing on the Original
Effective Date and continuing through the 15th Lease Year (the
"Exclusive Rights Period"), the exclusive right to operate any
type of excursion gaming boat, land based or other type of gaming
or gambling facility or facilities on any property which is at
any time during the Exclusive Rights Period owned or controlled,
directly or indirectly, by Landlord and located south of the
River des ▇▇▇▇▇ or, with respect to the development thereof or to
uses which may be made thereof by the owner, tenant or occupant,
under the direct or indirect administrative jurisdiction of
Landlord. Such exclusive rights shall include an obligation on
the part of Landlord to not authorize, endorse, support or
otherwise assist, directly or indirectly, in connection with
issuance by any governmental entity of any license or permit to
or for the development or operation of any potentially competing
gaming project south of the River des ▇▇▇▇▇ for the duration of
the Exclusive Rights Period.
(b) Conditions of Grant. Landlord's grant to
Tenant of exclusivity is subject to the following express
conditions: (i) the Casino shall remain in operation after
Project Opening; (ii) no Event of Default shall have occurred and
be continuing under this Lease on the part of Tenant or on the
part of the New Guarantor under the New Guarantees; (iii) Tenant
and New Guarantor shall honor the restrictive covenant contained
or referenced in Section 10(c); and (iv) Tenant shall not earn
more than $200,000,000 in AGR during any Lease Year; provided
that such amount shall be increased for the sixth (6th) Lease
Year and each Lease Year thereafter by the same percentage as the
percentage increase, if any, in the Consumer Price Index (as
hereinafter defined) between the last month of the fifth (5th)
Lease Year and the last month of the sixth (6th) and each
succeeding Lease Year, as the case may be. For purposes hereof,
the term "Consumer Price Index" means the Consumer Price Index
for All Urban Consumers for the U.S. City Average for All Items
1982-84=100, as determined by the United States Department of
Labor, Bureau of Labor Statistics. In the event that the
publication of the Consumer Price Index is discontinued, such
index as may be published by any United States government bureau
or department to replace the present Consumer Price Index shall
be substituted therefor.
(c) Restrictive Covenant. Tenant covenants and
agrees that during the Exclusive Rights Period, Tenant shall not
participate in any manner in the ownership, sponsorship, control,
management, operation or use of any riverboat gaming facility
along either the Illinois or Missouri banks of the Mississippi
River from the southern boundary of the City of St. Louis to the
northern boundary of Jefferson County. Tenant acknowledges that
the restrictive covenant contained in this Section 10(c) is
reasonable under all of the circumstances. Notwithstanding the
foregoing, the Exclusive Rights Period shall terminate upon any
termination of this Lease other than pursuant to Section 25
hereof.
(d) Right of First Refusal. In the event
Landlord shall elect to support issuance of a second gaming
license south of the River des ▇▇▇▇▇ because Tenant has earned
more than $200,000,000 in AGR, as adjusted pursuant to Section
10(b), during any Lease Year, and provided Tenant is in
compliance with the conditions described in clauses (i), (ii) and
(iii) of Section 10(b), Landlord shall grant Tenant a 180-day
right of first refusal (subject to extension during the pendency
of any arbitration proceeding as hereinafter defined) to commit
in writing to construct and operate a second gaming project in
unincorporated St. Louis County at a mutually acceptable location
(and on terms and conditions mutually acceptable to the parties)
which, if constructed and opened for operation by Tenant within
30 months after Tenant's election (which 30-month period shall be
subject to extension on account of Unavoidable Delays and/or
during the pendency of any arbitration proceeding as hereinafter
provided), shall operate, so long as the Tenant is in compliance
with respect to clauses (i), (ii) and (iii) above, as the same
pertain to both projects, to divest Landlord of the right to
implement or to authorize the implementation of any proposal from
another prospective tenant, developer or operator of a second
gaming facility, whether the proposal in question involves the
sale, lease or licensing of property owned or leased by Landlord
or Landlord's support before the Commission and the St. Louis
County Council with respect to an operation proposed to be
located on privately-owned land. Tenant's failure to elect to
construct and operate a second gaming project by timely written
notice to Landlord shall constitute a waiver of Tenant's right of
first refusal, unless Landlord's proposal does not result in a
sale or lease of the site in question, in which event Tenant's
right of first refusal shall be deemed reinstated. Landlord
agrees to lend all reasonable cooperation to Tenant in connection
with any timely exercise by Tenant of Tenant's right of first
refusal to construct and operate a second gaming project. In the
event of a dispute between Landlord and Tenant regarding any
aspect of Tenant's specific plans for the construction and
operation of a second gaming project or the terms of a lease or
other agreement with Landlord with respect to such second gaming
project (other than rent, which shall be equal to the then-
current Rent payable under this Lease), either party shall have
the right to submit such dispute to binding arbitration in
accordance with the procedures of Section 31.
(e) Memorandum of Restrictive Covenant. The
provisions of this Section 10 shall be incorporated into a
memorandum prepared and recorded by Landlord against the Adjacent
Parcel and any property now or hereafter owned by Landlord and
located south of the River des ▇▇▇▇▇.
11. Covenant of Continuous Operation.
(a) Maximization of Revenues. The Project
(including the Casino and any barges utilized in connection with
the Project, and all structures, parking lots, driveways,
landscaping, fencing, lighting and signage), shall be maintained,
managed, operated, staffed, serviced, equipped and repaired in
accordance with all Governmental Requirements, insurance
requirements and the highest standards of projects operating
along and from the Mississippi and Missouri Rivers. The Casino
shall remain in operation 24 hours a day, 7 days a week, 365 days
a year, so as to maximize the opportunity of Landlord to earn
Percentage Rent under Section 5(a)(iii), except to the extent
limited by applicable Governmental Requirements, Unavoidable
Delays, casualty or condemnation or by repairs, replacements or
alterations made by Tenant in accordance with the provisions of
Section 9. Tenant shall provide a reasonably adequate complement
of properly trained and equipped security personnel for the
Project at all times.
(b) Particular Operations. The exterior of the
Project and all Project signage shall be illuminated at all times
during which the Project is open. Subject to applicable laws,
Tenant shall have the right to erect or affix such signs and
banners as Tenant may require in its discretion for directional,
informational, promotional or advertising purposes upon windows,
doors and walls (interior and exterior) of Project structures and
otherwise on or about the Project. All signs and banners shall
be in good taste and generally consistent with the themes and
aesthetics of the Project.
(c) Illegality of Gaming Operations.
Notwithstanding the foregoing provisions of this Section 11, in
the event casino gaming shall become illegal in the State of
Missouri by virtue of legislative action taken by the Missouri
General Assembly, popular referendum or otherwise, and in the
further event that the Casino is closed for a period of 365
consecutive days due to such legal impediment, then either party
shall have the right to cancel this Lease by delivery of written
notice of such election to the other party at any time prior to
the date casino gaming again becomes legal in the State of
Missouri. For so long as the Project remains closed due to such
legal impediment, Tenant's obligation to operate the Project and
to pay Rent shall be suspended. Landlord or Tenant shall have
the right but not the obligation to contest the validity of any
legal impediment to the operation of the Project arising under
this subsection (c), and in the event either party elects to
contest such impediment, the other party shall lend all non-
financial assistance reasonably required by the contesting party;
provided, however, Tenant shall not be obligated to participate
in or assist Landlord in connection with such contest if the
Project is closed for 365 days due to such legal impediment and
either party elects to cancel this Lease as provided in this
subsection (c).
12. Assignment and Subletting.
(a) Landlord's Consent Generally. No assignment
or subletting (including licensing) shall be allowed without the
prior written consent of Landlord, which consent shall not be
unreasonably withheld. In no event shall any assignment or
subletting operate by itself to release Tenant from any liability
under this Lease, release New Guarantor from any liability under
the New Guarantees or constitute permission for any further
subletting or assignment. Consent to any one proposed assignment
or sublease shall not be deemed consent to further proposed
assignments or subleases. A partnership or corporate transaction
involving Tenant or the General Partner, including without
limitation a merger or sale or other transfer of the partnership
interests in Tenant or the stock of or partnership interests in
the General Partner, which results in a change of control of the
Tenant or the General Partner, shall constitute an assignment
requiring Landlord's prior written consent. Notwithstanding the
foregoing provisions of this Section 12(a), if the transaction
involves the assignment of this Lease to the New Guarantor or to
any corporation, partnership or limited liability company
controlling or controlled by the New Guarantor or under common
control with Tenant, the consent of Landlord thereto shall not be
required, but no such transaction, by itself, shall release
Tenant from any liability under this Lease. Tenant shall deliver
notice to Landlord of any assignment or sublease which Tenant
believes does not require Landlord's consent under this Section
12(a), together with sufficient information to enable Landlord to
verify that its consent is not required. The assignment or
pledge of the assets of the Project as collateral for financing
purposes shall not be considered an assignment pursuant to this
Section 12 but shall be governed by the provisions of Section 19.
Landlord's consent shall not be required in connection with the
subletting or licensing of portions of the Premises for bar,
restaurant, hotel, retail, recreational, entertainment or other
purposes which are incidental to the operation of the Casino and
which do not reduce the floor space dedicated to Casino gaming
under Section 9; provided that no such subletting or licensing
shall operate to relieve Tenant of any liability under this
Lease.
(b) Procedures for Assignment and Subletting. In
the event Tenant desires to assign its interest in this Lease or
to sublet the use of all or any portion of the Project, and
provided Landlord's consent to such assignment or subletting is
required under Section 12(a), Tenant shall deliver notice of the
proposed transaction to Landlord, together with detailed
information regarding the financial condition and operating
history of the proposed assignee or subtenant (including any
operator) and the terms of the proposed assignment or subletting.
Within 30 days after receipt of the foregoing information, and
subject to the provisions of subsection (a) of this Section 12,
Landlord shall accept or reject Tenant's proposal. Landlord's
rejection shall be based upon (i) the failure of the proposed
assignee or subtenant to meet any of the "Stated Criteria" as
hereinafter defined, or (ii) the occurrence of an Event of
Default, and Landlord shall specifically state the grounds for
Landlord's rejection. If Landlord shall fail to respond to
Tenant within 30 days after receipt of Tenant's proposal,
Landlord shall be deemed to have accepted such proposal. In the
event Tenant shall object to Landlord's rejection of Tenant's
proposal, Tenant's sole remedy shall be to commence arbitration
proceedings in accordance with the provisions of Section 31. The
arbitrators shall either approve or disapprove the proposed
assignment or sublease based on their determination regarding
compliance with the Stated Criteria or whether an Event of
Default has occurred and shall make no other award or
determination. Tenant agrees to indemnify and hold Landlord
harmless from and against any loss, cost, damage, claim, demand
or expense (including attorneys' fees and expenses) incurred by
Landlord in connection with any action brought by or for the
benefit of the proposed assignee or subtenant or seeking relief
other than arbitration as provided herein. In the event an
assignment is approved by Landlord or through arbitration, the
assignee shall be subject to all of the provisions of this Lease.
(c) Stated Criteria. With respect to any
assignee or subtenant (or the general partner, if the assignee or
subtenant is a partnership), the following shall constitute the
Stated Criteria for approving any proposed assignee of Tenant's
interest in this Lease or any proposed subtenant or operator of
the Project:
(i) the assignee, subtenant or parent corporation
of such assignee or subtenant shall have a
net worth of not less than $10,000,000.00,
and if such parent corporation is relied upon
to meet the net worth test, it shall deliver
a guarantee of the Lease suitable to
Landlord;
(ii) the assignee, subtenant or parent corporation
of such assignee or subtenant shall have a
sufficient casino gaming operating history or
reputation in the industry or community or a
manager with such experience or reputation,
in the reasonable judgment of Landlord; and
(iii)the assignee, subtenant or parent corporation
of such assignee or subtenant shall have a
gaming license to operate the Project.
Tenant agrees that Landlord shall not be deemed
unreasonable in rejecting a proposed assignee or subtenant on any
of the above-stated grounds.
(d) Conveyance by Landlord. Landlord shall
promptly notify Tenant in writing of any conveyance of the
Premises, in whole or in part, or any interest therein, to any
party. Landlord shall not convey the Premises, in whole or in
part, or any interest therein to any party if such conveyance
shall impair Tenant's rights under this Lease or jeopardize
Gaming Licensure. Landlord's right to transfer title to the
Premises or to assign rentals derived therefrom to any
governmental body shall not be deemed to constitute any such
impairment or jeopardy.
13. Reporting Covenants. Tenant shall report, or,
prior to the Assignment Date, shall cause Assignee to report,
each month in writing to Landlord the progress of the Gaming
Licensure and Permit application process, the progress of
construction, and, after Project Opening, on a quarterly basis,
AGR realized by Tenant. Tenant also shall provide, or, prior to
the Assignment Date, shall cause Assignee to provide, Landlord
with such other information regarding the development and
operation of the Project as Landlord may reasonably request,
including the status of Tenant's obligations under the Lease.
All reports of AGR shall be certified as to accuracy and
completeness by an officer of Tenant. In addition, copies of
annual audit statements shall be provided to Landlord by Tenant,
and Landlord shall have the right, at Landlord's sole cost and
expense, except as hereinafter provided, to conduct an audit of
the books and records of Tenant, not more frequently than once
during any Lease Year, in order to verify the accuracy of AGR
reported by Tenant and Tenant's compliance with the various
operating and reporting covenants contained in this Lease.
Tenant shall maintain Tenant's books and records in support of
Tenant's computations and reporting of AGR in accordance with
generally accepted principles of accounting consistently applied.
Tenant's books and records shall be retained or made available in
the St. Louis metropolitan area, available for inspection and
audit by Landlord during regular business hours on reasonable
prior notice to Tenant and without material interruption of
Tenant's business. In the event Landlord's audit or any audit
conducted by the Commission discloses that AGR has been under-
reported such that Landlord is entitled to receive an additional
payment of Annual Rent, Tenant shall promptly make payment to
Landlord of the entire sum due Landlord. In the event the amount
due exceeds 5% of the amount paid by Tenant, Tenant also shall
pay Landlord's reasonable expenses in conducting such audit.
Upon Landlord's request, Tenant also shall provide Landlord with
a copy of each financial statement, report and filing issued by
or on its behalf and provided to any regulatory body, including,
without limitation, the Missouri Gaming Commission, the
Securities and Exchange Commission and other authorities,
agencies and commissions having jurisdiction over Tenant's
operations. Tenant shall promptly report to Landlord any notice
received by it from any governmental authority or in respect of
any proceedings at law or in equity to which Tenant is a party
alleging violation of any Governmental Requirements by Tenant,
and Tenant shall provide to Landlord such information as Landlord
may request in connection therewith. Upon Landlord's request,
Tenant shall present to Landlord on an annual basis the Coast
Guard certificate of inspection obtained for the Casino. Tenant
hereby irrevocably designates St. Louis County as the "home dock"
for the Project during the Term for all purposes under Section
313.822 of the Revised Missouri Statutes, and Tenant agrees to
confirm the status of the County as the "home dock" for the
Project as and when requested to do so by Landlord or the
Commission.
14. Insurance.
(a) Types of Insurance. Throughout the Term,
Tenant shall maintain in full force and effect the following
insurance coverage:
(i) commercial liability insurance on an
"occurrence basis" against claims for
"personal injury" including, without
limitation, bodily injury, death or property
damage occurring on, in or about the Project
or in connection with any other operations of
Tenant related to the Project (such as, by
way of example, off-site bus or shuttle
service), such insurance to afford immediate
minimum protection of $5,000,000 combined
single limit/per occurrence and $10,000,000
aggregate, and, (a) with respect to the
Project exclusive of any boat hull, a
deductible not greater than $75,000, and, (b)
with respect to any boat hull, a deductible
not greater than 1% of the value of the boat;
(ii) property insurance against loss or damage to
the Project (including the Casino) by fire
and other risks covered by insurance of the
type now known as "fire and extended
coverage" in an amount equal to the
replacement value of the Casino and remainder
of the Project and with a deductible not
greater than $75,000 from the loss payable
for any casualty;
(iii)protection and indemnity insurance including
collision liability covering collisions with
all fixed or floating objects with a minimum
limit of $5,000,000 per occurrence and a
deductible not greater than $75,000;
(iv) worker's compensation insurance in full
compliance with all applicable state and
federal laws and regulations, including a
specific endorsement covering liability for
Federal Longshoremen's and Harbor Workers'
Compensation Act;
(v) employers liability insurance in the minimum
amounts of $1,000,000 per individual claim,
not to exceed $10,000,000 in the aggregate,
with a deductible not greater than $350,000,
covering injury or death to any employee
which may be outside of or in addition to
liability under any worker's compensation
statutory coverage;
(vi) excess or umbrella insurance providing a
minimum of $10,000,000 in excess of
underlying limits and coverage provided by
commercial general liability, protection and
indemnity and employer's liability policies;
and
(vii)personal property insurance covering Tenant's
trade fixtures, equipment, goods and
inventory in an amount not less than 95%
replacement value.
(b) Quality of Coverage. All such policies shall
be issued by insurance companies licensed to do business in the
State of Missouri and approved by Landlord as to form and as to
surety and reserving the right of recovery by the Landlord in the
event of damage to its property and issued in the name of Tenant
and naming Landlord as additional insured, as its interest may
appear. In addition, one or more of the policies shall include
special dram shop and vehicular endorsements and a contractual
liability endorsement covering the indemnification agreements of
Tenant contained in this Lease. Policy certificates shall be
delivered to Landlord on the Effective Date and shall state that
the coverage afforded thereby shall not be modified or canceled
without 30 days' prior written notice to Landlord, delivered by
registered mail. Provided no Event of Default has occurred and
is continuing, all loss proceeds shall be made available to
Tenant to restore and repair the Project (including the Casino)
as provided in Section 15. Permitted deductibles may be
increased by an amount equal to any increased inflation in the
value of U. S. currency.
(c) Renewal of Coverage. Certificates of
insurance with reasonably satisfactory evidence of payment of the
premium thereof, shall be delivered to Landlord on or before the
Commencement Date or date of Project Opening, as appropriate, and
upon renewals of such policies, not less than 30 days after
renewal. Not less than 30 days prior to the expiration of any
such coverage, Tenant will provide evidence to Landlord of
continuing insurability by means of letters from qualified
carriers confirming intent to renew or provide the required
coverage. If Tenant at any time fails or refuses to procure or
maintain the required amount of insurance, then the Landlord may,
and without notice to Tenant, obtain same for and on behalf of
Tenant and charge the cost thereof to Tenant, such charge to be
due and payable upon demand and to constitute Additional Rent
hereunder.
(d) Waiver of Subrogation and Right of Recovery.
Tenant, and all parties claiming under or through Tenant, hereby
expressly release and discharge Landlord and the County from any
claim or liability, whether based on negligence or any reason
whatsoever, for any personal injury or property damage. All
insurance policies of Tenant shall contain an endorsement
containing an express waiver of any right of subrogation by the
insurance company against Landlord and the County.
(e) Additional Insurance. Tenant shall obtain
such other insurance in such amounts as may from time to time be
reasonably required by the Landlord against other insurable
hazards, and the Landlord may require the amount of any policy of
insurance Tenant is required to maintain pursuant to the
provisions of this Lease to be reasonably increased. Tenant
shall not carry separate or additional insurance concurrent in
form or contributing in the event of any loss or damage with any
insurance required to be obtained by Tenant under this Lease, if
the effect of such insurance would be to reduce the protection or
payment to be made under insurance required hereunder. In the
event Tenant objects to any increased or additional coverage
required by Landlord on the grounds that such coverage is not
required of, or is not commercially available to, other operators
of facilities similar to the Project, and Landlord disagrees, the
issue shall be submitted to binding arbitration in accordance
with the provisions of Section 31 hereof.
15. Damage and Destruction.
(a) Casualty Termination. If, at any time during
the last 10 years of the Term, the Project is damaged by any
cause or casualty in an amount exceeding 15% of the then
replacement cost of the Project, Tenant shall have the right to
terminate this Lease by written notice to Landlord within 60 days
of the happening of the casualty causing such damage or
destruction. In such event, Landlord (subject to the
requirements of any Leasehold Mortgage (as defined in Section
19)) shall receive from the insurance proceeds the lesser of
(a) the then present value of the Minimum Rent payable to
Landlord for the remainder of the Term plus the amount equal to
the cost of rebuilding all damaged or destroyed land-based
facilities, or (b) 100% of the insurance proceeds. Any funds
remaining following the distribution of the insurance proceeds
paid to Landlord pursuant to the previous sentence shall be paid
to Tenant. Upon any termination of the Lease under this
provision, Tenant shall surrender possession of the Premises
within 90 days after notice of termination, whereupon each of the
parties shall be released thereby from any further obligations to
the other except for items which have theretofore accrued and are
then unpaid, and such termination shall be deemed to relate back
to the date of damage or destruction; provided, however, that if
the Project or any part thereof shall be kept open for business
after the date of damage and prior to the surrender of possession
of the Premises, the termination date shall be the date upon
which Tenant shall discontinue the conduct of its business on the
Premises. In the event of any termination pursuant to this
Section 15(a), and upon surrender of the Premises to Landlord,
Landlord shall refund to Tenant any unearned portion of Annual
Rent prepaid by Tenant. In addition, in the event Landlord
relets the Premises to another lessee, Landlord shall reimburse
Tenant for the prepaid Minimum Rent paid by Tenant due to the
termination of this Lease pursuant to this Section 15(a) from the
rent paid by such lessee.
(b) Casualty Reconstruction. In the event of
damage or destruction occurring to the Project (including the
Casino) other than as described in subsection (a) above, Tenant
shall (subject to compliance with the requirements of any
Leasehold Mortgage (as defined in Section 19)) repair and rebuild
the Project (including the Casino), and restore the Project to
full operation with reasonable diligence; Tenant shall direct,
control, coordinate and approve all such repairs, reconstruction
and restoration contemplated by this provision and shall have the
right to select any architects, engineers and contractors for
such repairs, reconstruction or restoration. All loss proceeds
shall be made available to Tenant and shall be applied to effect
such repair, reconstruction or restoration of the Project. No
component of Annual Rent or Additional Rent shall ▇▇▇▇▇ as a
result of any such damage or destruction, regardless of the
availability or sufficiency of loss proceeds to repair or restore
the Project, it being understood and agreed that Tenant shall
maintain such business interruption insurance as Tenant may
require in order to assure Tenant of the ability to continue to
meet Tenant's financial obligations under this Lease.
16. Condemnation.
(a) Definitions. Whenever used in this section,
the following words shall have the following respective
definitions and meanings: (i) "condemnation" or "condemnation
proceedings" - any action or proceeding brought by competent
authority for the purpose of the taking of the fee of the
Premises, the Project or any part thereof, as a result of the
exercise of the power of eminent domain, including a voluntary
sale to such authority either under threat of or in lieu of
condemnation or while such action or proceedings is pending; (ii)
"taking" - the event of vesting of title to the fee of the
Premises, or the Project or any part thereof, in the competent
authority pursuant to condemnation; (iii) "vesting date" - the
date of the taking.
(b) Defense of Taking. Landlord, immediately
upon obtaining knowledge of the institution of any proceedings
for the condemnation of the Premises or any part thereof, shall
notify Tenant of the pendency of such proceedings. Landlord
shall then, if requested by Tenant, file or defend its rights
thereunder and prosecute the same with due diligence to its final
disposition. Tenant may, but shall not be required to,
participate in any such proceedings and Landlord from time to
time will deliver to Tenant all instruments requested by it to
permit such participation. In the event Tenant chooses to
participate in any such proceedings, Landlord may be the nominal
party in such proceedings, but Tenant shall be entitled to
control and direct the same and to be represented therein by
counsel of its choice, at Tenant's cost. Landlord covenants and
agrees that it will use its best efforts and take all actions
necessary and appropriate to cause the County not to exercise its
powers of eminent domain with regard to the Premises, the Project
or any part thereof, and otherwise to assure to the greatest
extent possible that neither the Premises, the Project nor any
part thereof, shall be condemned during the Term.
(c) Total Taking. In the case of a taking of all
of the Premises and the Project, this Lease shall terminate as of
the vesting date and the Rent under this Lease shall be
apportioned to the date of termination, and upon surrender of the
Premises to Landlord, Landlord shall refund to Tenant any
unearned portion of Annual Rent prepaid by Tenant.
(d) Partial Taking - Termination or Arbitration.
In the case of a taking of less than all of the Premises and
Project (other than for a temporary use) Landlord and Tenant
mutually shall determine within a reasonable time after the
vesting date whether the remainder thereof can economically and
feasibly be used by Tenant. If Landlord and Tenant cannot
mutually agree upon such matter with 90 days after the vesting
date, it shall be determined by binding arbitration pursuant to
the provisions of Section 31. If it is determined by mutual
agreement or by arbitration that the remaining Premises and
Project cannot economically and feasibly be used by Tenant,
Tenant may terminate this Lease on not less than 10 days nor more
than 30 days notice to Landlord to such effect, provided that
such notice is given within 30 days after such determination, and
the Rent shall be apportioned to the date of termination. If
Tenant does not elect to terminate this Lease within the period
aforementioned, it shall continue in full force and effect with
respect to the remaining portion of the Premises. If this Lease
shall terminate pursuant to this provision, the award for the
Project shall be apportioned and paid, to the extent available,
in the following order of priority: (i) Landlord and Tenant
first shall be entitled to their reasonable expenses and charges
including, without limitation, reasonable attorneys' fees
incurred in connection with the taking; (ii) Landlord shall be
entitled to the value of the fee exclusive of the value of this
Lease; and (iii) Tenant shall be entitled to the balance of the
award. If the court in which the condemnation proceedings are
brought fails or refuses to apportion its award between Landlord
and Tenant, and if Landlord and Tenant cannot agree upon the
allocation defined in the above order of priority, such values,
allocation and apportionment shall be determined by binding
arbitration under the provisions of this Lease. The provisions
of this section regarding the apportionment of the award shall
also apply in the case of a total taking and shall survive any
termination of this Lease pursuant to this Section 16.
(e) Partial Taking - Reconstruction. In the case
of a partial taking where the Tenant does not elect to terminate
this Lease pursuant to the provisions set forth above, Tenant
shall commence and proceed with reasonable diligence to repair
and reconstruct the remaining improvements to a complete,
economically usable, architectural unit or units, including,
without limitation, temporary repairs, changes and installations
required to accommodate space subtenants and all other work and
replacements and additions of furniture and furnishings
incidental to and appropriate in connection with all of the
foregoing (all such repair, reconstruction, replacements and
additions and work being referred to in this section as
"restoration"); and the total award of the condemnation
proceedings, including the award for the Project shall be
apportioned and paid to the extent available in the following
order of priority: (i) Landlord and Tenant first shall be
entitled to their reasonable expenses and charges including,
without limitation, reasonable attorneys' fees incurred in
connection with the taking; (ii) Tenant shall be entitled to an
amount equal to the cost of restoration to the extent
contemplated by this section, such sums shall be turned over to
Tenant to be held in trust for the purpose of paying for the cost
of restoration; (iii) Landlord shall be entitled to the value of
the fee exclusive of the value of this Lease; (iv) Tenant next
shall be entitled to the value of its leasehold estate under this
Lease, the value of the Project, the value of the furniture,
fixtures and equipment of the Project and the balance of the
award. In the case of a partial taking where the Tenant does not
elect to terminate this Lease pursuant to the provisions set
forth above, the Rent payable for the balance of the Term of this
Lease shall be equitably reduced effective as of the date of such
partial taking to an amount fixed by agreement between Landlord
and Tenant or, in the event of their failure to agree within
thirty (30) days of such taking, by arbitration pursuant to the
provisions of Section 31.
(f) Temporary Taking. In the event of a taking
of all or any portion of the Premises and the Project for
temporary use, the foregoing provisions of this Section 16 shall
be inapplicable thereto. This Lease shall remain in full force
and effect and Tenant alone shall be entitled to make claim for,
recover and retain any award recoverable in respect of such
temporary use, so long as Rent is first paid from such award. If
any portion of the award for such temporary use is intended to
cover the cost of restoring the Premises and the Project to the
condition they were in prior to such temporary use, such portion
of the award shall be paid to Tenant to cover the cost of such
restoration and repair.
17. Adjacent Parcel.
(a) Development Parameters. Tenant and its
affiliates shall be permitted to submit proposals to Landlord for
the development of all or portions of the Adjacent Parcel. The
Adjacent Parcel may be developed by Landlord and/or other parties
for light industrial, commercial, retail, entertainment and/or
recreational uses. Structures of any size or height, such as
warehouses, distribution centers, manufacturing facilities,
hotels, shopping centers, entertainment, sporting or recreational
facilities, parking lots or garages, communications towers, and
docking facilities, may be constructed and operated on the
Adjacent Parcel. Landlord covenants that no use may be made of
the Adjacent Parcel which shall constitute a nuisance or
hindrance to the Project, detract materially from the aesthetic
appeal of the Project, generate excessive industrial noise or
noxious industrial or chemical odors, or materially impair access
to the Project. Neither the volume nor type of traffic,
including heavy truck traffic, on the Adjacent Parcel, including
any resulting noise or omissions, nor any signage or illumination
located on the Adjacent Parcel, shall be deemed to constitute a
nuisance, impairment or detraction. That portion of the Adjacent
Parcel which is within the 50' by 550' zone along the northern
perimeter boundary of the Premises identified on Attachment K
shall constitute a "Buffer Zone" between any development located
on the Adjacent Parcel and the Premises. Only green space or
landscaping shall be located within the Buffer Zone. Tenant
shall have a non-exclusive, irrevocable license during the Term
of this Lease, at Tenant's sole risk, cost and expense, at
Tenant's option, but without obligation, to enter upon the Buffer
Zone for the sole purpose of performing, maintaining, repairing
and replacing landscaping on the Buffer Zone should Tenant so
desire. Notwithstanding the foregoing provisions of this Section
17(a), the parties acknowledge and agree that a reconfiguration
of the roadway providing access to the Premises and/or the
Adjacent Parcel, if and as agreed to by the parties in connection
with a resolution of pertinent access issues, may entail access
to the Adjacent Parcel (i) via the bridge to be constructed by
Tenant or via the roadway to be constructed on the Premises, or
(ii) to provide alternate access to the Premises for emergency
vehicles.
(b) Enforcement. A restrictive covenant
consistent with the requirements of Section 17(a) shall be
recorded by Landlord against the Adjacent Parcel, and such
restrictive covenant shall be prior and paramount to any
mortgage, deed of trust or other encumbrance against the Adjacent
Parcel. Landlord shall have the right but not the obligation to
enforce compliance with such covenant to the extent the real
estate in question has been sold or transferred to a third party,
but Tenant, its successors and assigns, shall be designated in
the covenant as intended beneficiaries thereof with full right to
institute action, legal and equitable, for any violation thereof.
To the extent Landlord retains ownership of the real estate in
question and the violation complained of is committed by a tenant
or occupant of the real estate, Landlord shall use its best
efforts to enforce Landlord's rights under the covenant by
appropriate legal action, including seeking appellate relief, if
necessary.
(c) Original Lease. In the event of a conflict
between any provision of this Section 17 and any existing
provision of that certain Lease between Landlord, as successor to
NL Industries, Inc., and The ▇▇▇▇▇▇ Company, as Tenant, dated as
of April 1, 1997, including any amendments thereto and
restatements thereof, the provisions of the latter such lease
shall control. In the event the operations of the ▇▇▇▇▇▇
Company, its successors, assigns or subtenants, on or from the
▇▇▇▇▇▇ Company premises, are interfering with, or will likely
interfere with, Tenant's development or operation of the Project,
in the reasonable judgment of Tenant, after written notice to
Landlord, and provided other measures taken by Landlord and the
▇▇▇▇▇▇ Company to obviate the interference or potential
interference are either unavailable or prove insufficient,
Landlord agrees to cancel the ▇▇▇▇▇▇ Company lease at the
earliest permissible date.
18. Non-Disturbance and Attornment. Landlord shall
have the right to obtain from any lender (a "Mortgagee") a
mortgage secured by Landlord's interest in the Premises and/or
this Lease; provided, however, that this Lease, including all of
the rights of Tenant under or pursuant to this Lease, shall be
paramount to, and shall not be subject or subordinate to, any
mortgage, deed of trust or other security interest instrument
("Mortgage") that may now or hereafter affect Tenant's interest
in the Premises. Any Mortgage shall contain, as required terms,
the express acknowledgment that Tenant shall not be liable for
the payment of the sum secured by such Mortgage, nor for any
expenses in connection with the same. Neither such Mortgage nor
any instrument collateral thereto shall contain any covenant or
other obligation on Tenant's part to pay such debt, or any part
thereof, or to take any affirmative action of any kind
whatsoever; provided, however, that Tenant shall remain liable
under this Lease notwithstanding any foreclosure of Landlord's
interest in the Premises or any transfer of title to the
Premises, and provided further that Tenant shall agree to attorn
to such transferee. Such Mortgage shall expressly provide that
the Mortgagee shall not seek any money judgment against Tenant
related to any Mortgage obligation of Landlord. Each Mortgagee
shall agree to a non-disturbance and attornment agreement which
will require the Mortgagee to recognize that this Lease is
superior to Mortgagee's Mortgage, (ii) that Tenant shall be
entitled to use and occupy the Premises and the Project in
accordance with the terms of this Lease, (iii) that Tenant shall
be entitled to all of its rights under this Lease, (iv) that
insurance and condemnation awards and proceeds shall be disbursed
as provided in this Lease, and (v) Tenant's possession of the
Premises and the Project shall not be disturbed by Mortgagee or
by any person whose rights are acquired through foreclosure
proceedings or through a deed in lieu of foreclosure except as
may be expressly provided in this Lease, and any subsequent
transferee of such rights shall be so bound provided no Event of
Default occurs and is continuing under this Lease. The non-
disturbance and attornment agreement may require (x) that as a
condition to the making of any amendment or modification to this
Lease Landlord receive the prior written consent of such
Mortgagee, (y) that such Mortgagee shall receive notice of any
default claimed by or through Tenant against Landlord, and (z)
that such Mortgagee shall have the same right to cure such
default as is provided the holder of any Leasehold Mortgage
obtained by Tenant. Tenant shall within 10 days after receipt
from Landlord execute and deliver to Landlord and Landlord's
Mortgagee such estoppels and attornment agreements as may be
reasonably required in connection with any proposed financing or
refinancing involving the Premises and/or the Adjacent Parcel,
provided the terms and conditions of such estoppels or attornment
agreements are consistent with the provisions of this Section 18
and the same do not constitute a modification of this Lease.
19. Leasehold Mortgages.
(a) Right to Leasehold Mortgage. Tenant shall
have the right to mortgage and to refinance this Lease and
Tenant's leasehold estate and any improvements thereon, including
but not limited to the Project, ("Leasehold Mortgage") at any
time, and from time to time, on any terms Tenant may deem
desirable and to assign this Lease and any existing and future
subleases, license agreements and concession agreements, and the
rentals and fees payable to Tenant thereunder to the holder of
such mortgage ("Leasehold Mortgagee"), as additional collateral
security for the indebtedness secured by the Leasehold Mortgage.
In connection therewith, Landlord agrees to timely execute and
deliver an estoppel certificate, a non-disturbance agreement, and
such other documents in reasonably satisfactory form as shall be
requested by any Leasehold Mortgagee, so long as such
certificates, agreements or other documents are not inconsistent
with this Lease. Any Leasehold Mortgage shall be subject and
subordinate to Landlord's rights under this Lease and its fee
interest in the Premises, except as otherwise provided herein.
(b) Terms of Leasehold Mortgage. If Tenant shall
have executed and delivered a Leasehold Mortgage or Mortgages and
the Leasehold Mortgagee shall have notified Landlord in writing
to such effect giving its name and address:
(i) Landlord concurrently shall serve upon such
Leasehold Mortgagee a copy of each notice,
consent, approval, request or demand given to
Tenant under this Lease including, without
limitation, any notice, consent, approval,
request or demand under this Lease. No such
notice to Tenant shall be deemed to have been
given nor shall be effective unless copies
thereof are thus served upon the Leasehold
Mortgagee at such address and in the manner
provided pursuant to the Notice provisions
hereof.
(ii) Subject to the provisions set forth below,
such Leasehold Mortgagee shall have the
right, for a period of 30 days more than is
given to Tenant, to remedy or cause to be
remedied any default which is the basis of a
notice; and Landlord shall accept performance
by such Leasehold Mortgagee as performance by
Tenant. In the event that Tenant has
contested an event of default, such Leasehold
Mortgagee shall be given a 20 day period
after the date of a final decision affirming
the contested default within which to cure
such default on behalf of Tenant.
(iii)In the case of default by Tenant under this
Lease which is susceptible of being cured
only when such Leasehold Mortgagee has
obtained possession of the Premises and the
Project, other than a default in the payment
of Rent or Additional Rent, Landlord shall
take no action to effect a termination of
this Lease by service of a notice or
otherwise without first giving to such
Leasehold Mortgagee a reasonable period of
time (not to exceed 6 months) within which
diligently to obtain possession of the
Premises and the Project (including
possession by a receiver) and to cure such
default and/or diligently to institute and
complete foreclosure proceedings or otherwise
acquire Tenant's leasehold estate under this
Lease and to cure such defaults.
(iv) Upon acquisition of Tenant's interest in this
Lease by the Leasehold Mortgagee, or by any
purchaser of this Lease pursuant to any
foreclosure proceeding instituted by the
Leasehold Mortgagee, Landlord's right to
serve a notice of election to end the Term
based upon the occurrence of any default
(other than non-payment of Rent or Additional
Rent, or non-compliance with the provisions
of Sections 9, 10, 12, 14, 15 or 20) which
cannot with the exercise of due diligence be
remedied by such Leasehold Mortgagee or
purchaser shall be deemed waived.
(v) If, prior to any foreclosure sale brought by
a Leasehold Mortgagee, or if prior to the
date upon which Tenant's interest in this
Lease shall have been otherwise acquired by
Leasehold Mortgagee or other purchaser, the
default in respect of which Landlord shall
have given the notice shall have been
remedied and possession of the Premises and
the Project restored to Tenant, the
obligation of the Leasehold Mortgagee to
assume this Lease shall be null and void and
of no further effect.
(vi) Notwithstanding anything contained in this
Section 19 to the contrary, if for any reason
this Lease shall terminate prior to the
expiration of the Term, Landlord shall give
written notice thereof to the Leasehold
Mortgagee. Subject to the curing of any
Event of Default and the payment of all Rent
and Additional Rent owed Landlord by the
Tenant, and provided such cure occurs not
later than 60 days after Landlord's
termination of this Lease, Landlord shall
enter into a new lease for the Premises and
the Project with the Leasehold Mortgagee or
with any person, firm, corporation or entity
designated by the Leasehold Mortgagee for the
remainder of the Term, subject to approval by
Landlord, which approval shall not be
unreasonably withheld or delayed as provided
in clause (vii) below, commencing as of the
date of such termination, at the Rent and
upon the same terms, covenants and conditions
contained in this Lease (except those which
by their terms are no longer applicable).
Such new lease shall have priority equal to
this Lease. Concurrently with the execution
and delivery of such new lease, Landlord
shall turn over and/or assign to the new
tenant all of its right, title and interest
in and to moneys (including insurance
proceeds) if any, then held by or
subsequently paid to Landlord, which Tenant
would have been entitled to receive but for
such termination.
(vii)Landlord shall have no obligation (i) to
waive Landlord's lien rights (it being
understood and agreed that Landlord shall be
required only to subordinate such lien rights
to the security interests of the Leasehold
Mortgagee) or (ii) to agree to any
modification of any express term, covenant or
provision of this Lease, including, without
limitation, the disposition of the proceeds
of a condemnation or casualty contrary to the
provisions of this Lease. Landlord's
refusal to accept any proffered successor
tenant or operator of the Project shall be
deemed reasonable to the extent such party
fails to meet any of the Stated Criteria.
Tenant shall require any Mortgagee to provide
Landlord with notice of any default under the
terms of any loan agreements, mortgages or
promissory notes entered or provided to the
Mortgagee. In no event shall Landlord be
required to forbear in the exercise of any
remedies available to Landlord against New
Guarantor upon the occurrence of an Event of
Default by Tenant. In the event Landlord
shall refuse to approve a successor to Tenant
proffered by the Leasehold Mortgagee, the
sole remedy available to the Leasehold
Mortgagee shall be to commence arbitration
proceedings in accordance with the provisions
of Section 31. The arbitrators shall either
approve or disapprove the proposed successor
based on compliance with the Stated Criteria
and shall make no other award or
determination.
(c) Amendments Requested by Leasehold Mortgagee.
Landlord agrees, without obligation, to review and consider any
proposed amendments to this Lease requested by any Leasehold
Mortgagee or prospective Leasehold Mortgagee.
20. Indemnification.
(a) Indemnity Generally. Tenant shall defend,
pay, indemnify and hold harmless Landlord and its agents,
employees, servants and representatives (together, the
"Indemnified Parties") from and against any and all claims,
demands, injuries, damages, fines, penalties, lawsuits, actions,
proceedings, orders, decrees, judgments or liability of any kind
or nature by or in favor of anyone whomsoever and from and
against any and all costs and expenses incurred by any of the
Indemnified Parties, including reasonable attorneys' fees and
expenses, resulting or arising from or in connection with (i) any
accident, bodily injury, death, personal injury of any kind, or
property damage arising during the term of this Lease directly or
indirectly, out of or from or on account of any occurrence in,
upon, at, or about the Project; (ii) any accident, bodily
injury, death, personal injury or property damage arising,
directly or indirectly, out of or in connection with Tenant's
operation of gaming activities or the Casino; (iii) any use,
occupancy, non-use, or condition of the Project; and (iv) any
failure on the part of the Tenant to perform or comply with any
of the terms, covenants and conditions of this Lease.
(b) Defense. In case any action, suit or
proceeding is brought against any of the Indemnified Parties by
reason of any occurrence described in clauses (i) through (iv),
Tenant or Tenant's insurer, upon the request of Landlord, will,
at no expense to Landlord or the Indemnified Party, resist and
defend such action, suit or proceeding or cause same to be
resisted and defended by counsel reasonably acceptable to
Landlord, subject to the right of any applicable insurer to
direct and control such counsel. The Indemnified Party shall
have the right, at its discretion, to retain its own counsel and
be reimbursed by Tenant for all reasonable attorneys' fees and
costs incurred in the defense of any action. The obligations of
Tenant under this Section shall survive the termination of this
Lease.
(c) Environmental Indemnity and Release. In
addition to the foregoing, Tenant agrees to indemnify and hold
harmless the Indemnified Parties and to defend them against any
lawsuits or claims for any liability, injuries, damages,
penalties or fines (including reasonable attorneys' fees and
expenses) arising from or relating to the disposal, discharge,
release or spilling into or onto the air, water, soil, sewer
system or similar media of any Hazardous Substance which
disposal, discharge, release or spill, whether accidental or
intentional, occurs on, within or from the Project (including the
Casino, wherever located) during the Term. Tenant agrees that
Landlord shall have no liability or obligation of any kind to
Tenant on account of any Hazardous Substances released on or from
the Premises and covenants not to bring any action, claim or
demand against Landlord on account thereof; provided, however,
that such covenant to not ▇▇▇ Landlord shall not apply to any
release or migration of any Hazardous Substance onto the Premises
from the Adjacent Parcel which is caused by Landlord or any
tenant or occupant of the Adjacent Parcel, their respective
employees, contractors or agents, and which first occurs during
any period of Landlord's ownership after the Original Effective
Date.
(d) Survival of Indemnity. The provisions of
this Section 20 shall survive any termination of this Lease.
21. Right of Entry. Landlord and its authorized
agents and employees shall, upon reasonable notice and during all
reasonable business hours, have the right to enter upon the
Project to examine same; provided, however, that any such entry
shall not interfere with Tenant's use or the operation of the
Project, and provided further that Tenant shall have the right to
have a representative or employee of Tenant accompany any such
inspection by Landlord. Landlord shall have the right from time
to time to inspect the Premises and to conduct tests and
evaluations to confirm whether Hazardous Substances have been
released on or from the Project in violation of applicable
Governmental Requirements. Such tests shall be conducted at
Landlord's sole risk, cost and expense, except that if it is
determined that Tenant shall have violated the provisions of
Section 20 relating to the release of Hazardous Substances, then
Tenant shall, in addition to performing such remediation as may
be required, pay to Landlord all costs incurred by Landlord in
connection with such tests and evaluations, and such additional
tests and evaluations as Landlord may conduct to confirm
satisfactory completion of Tenant's remediation work.
22. Limitation of Claims. Landlord shall not be
responsible for any damage or loss to the Casino or the Project,
its furnishings, fixtures, equipment or other goods thereon due
to any cause whatsoever, including, but not limited to, theft,
vandalism, public disorder, fire, weather, collisions, floating
or underwater hazards, electrolysis, tie-up or boat defects.
Additionally, Landlord shall not be responsible for any damage or
injury to Tenant's patrons, wherever located, arising from any
source, and Tenant shall perform all acts necessary to provide
for the safety of its patrons while on the Premises or in the
Casino. Upon any sale of the Premises by Landlord, Landlord
shall be released from all obligations and liabilities accruing
under this Lease prior to the effective date of such sale,
provided the transferee shall expressly assume and agree to
perform for the benefit of Tenant all obligations of Landlord
under this Lease accruing after the effective date of such
transfer.
23. Attorneys' Fees and Expenses. Except as otherwise
expressly provided in this Lease, each party shall pay its own
attorneys' fees and expenses in connection with any matter
arising under this Lease.
24. Late Payments. Late payments shall be subject to
a 3% penalty and interest on late payments shall accrue from the
date of delinquency until paid at the rate of 2% in excess of the
from time to time publicly announced prime rate of interest of
The Bank of America; provided that a payment shall not be deemed
to be a late payment if such payment is made within any
applicable grace or cure period provided hereunder.
25. Default and Remedies.
(a) Tenant's Default. It shall be an Event of
Default if any one or more of the events described in the
following clauses (i) through (ix) shall occur and be continuing
after expiration of the applicable notice and cure period
provided for in such clause or otherwise provided for in
subsection (b):
(i) if default be made in the punctual payment of
any Rent payable to Landlord hereunder, when
and as the same shall become due and payable,
and such default shall continue for a period
of ten (10) days after written notice to
Tenant (except that Landlord shall not be
required to deliver notice of non-payment of
Rent on more than two occasions during any
Lease Year), or if default be made in the
punctual payment of any Additional Rent
payable hereunder, when and as the same shall
become due and payable, and such default
shall continue for a period of thirty (30)
days after written notice to Tenant;
(ii) if this Lease be mortgaged by Tenant except
as provided in Section 19, or if this Lease
be assigned or the Project (including the
Casino) or any part thereof be sublet, except
as provided in Section 12;
(iii)if Tenant shall abandon the Work or the
Project, or if Tenant shall fail to
continuously or fully operate the Project
after Project Opening as required under this
Lease;
(iv) if Tenant shall fail to timely file its
application for Gaming Licensure, or if
Tenant shall withdraw or effectively abandon
such application prior to termination of this
Lease in accordance with its terms or, after
first obtaining Gaming Licensure, if Tenant
for any reason ceases to be licensed to
conduct a gaming operation at the Project
pursuant to the laws of the State of
Missouri;
(v) if Tenant shall fail to observe, perform or
comply with any of the terms, covenants and
conditions in this Lease other than those
specified in subsections (i) through (iv)
above, within 30 days after notice from
Landlord specifying the nature of such
default;
(vi) if Tenant or New Guarantor shall file a
voluntary petition in bankruptcy or shall be
adjudicated bankrupt or insolvent or shall
file any petition or answer seeking any
reorganization, readjustment, liquidation,
dissolution or similar relief under any
bankruptcy or insolvency statute or law of
the United States or any State, or shall seek
or consent to or acquiesce in the appointment
of any bankruptcy or insolvency trustee,
receiver or liquidator of Tenant or New
Guarantor of all or any substantial part of
either of their respective properties or of
the Project;
(vii)if within 60 days after the commencement of
any involuntary proceeding against Tenant or
New Guarantor seeking reorganization,
readjustment, liquidation, dissolution or
similar relief under any bankruptcy or
insolvency statute or law, Tenant or New
Guarantor, as the case may be, fails to
secure a dismissal and discharge thereof;
(viii)if Tenant or New Guarantor shall make a
material misrepresentation in any
representation or warranty provided to
Landlord under this Lease or any of the New
Guarantees, as the case may be, or in any
report provided to Landlord pursuant to
Section 13; or
(ix) if New Guarantor shall be in default under
any covenant of New Guarantor contained in
any of the New Guarantees and such default
shall remain uncured beyond the period
provided therein for the cure thereof, if
any.
(b) Cure or Remedies. No Event of Default shall
be deemed to have occurred under clauses (ii) through (ix) unless
Tenant or New Guarantor, as the case may be, shall fail to cure
such default within 30 days after delivery by Landlord of written
notice of such default to Tenant, unless the same cannot be cured
within 30 days, in which event an Event of Default shall not be
deemed to have occurred if Tenant commences the cure of such
default within 30 days and thereafter diligently pursues such
cure to completion. Upon an Event of Default, Landlord, at its
option, may at any time thereafter declare this Lease and all
rights of Tenant under this Lease as expired and terminated and
Tenant shall remain liable as hereinafter provided.
(c) Surrender of Premises. Subject to the
provisions of Section 27, upon any such expiration or termination
of this Lease, Tenant shall quit and peacefully surrender the
Project to Landlord, and Landlord, upon any such expiration or
termination, may without further notice enter upon and re-enter
the Project and possess and repossess itself thereof, by force,
summary proceedings, ejectment or otherwise, and may dispossess
Tenant and remove Tenant and all persons and property from the
Project.
(d) Reletting of Premises. If this Lease shall
expire or be terminated, or if the Project or any part thereof
shall be abandoned by Tenant, or shall become vacant during the
Term, Landlord may in its own name, or as agent for Tenant if
this Lease not be terminated, enter into possession of and relet
the Project or any part thereof for such term or terms (which may
be greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions as
Landlord, in its discretion, may determine and may collect and
receive the rents therefor.
(e) Direct Damages. No event of expiration or
termination of this Lease, abandonment or vacancy, shall relieve
Tenant of its liability and obligations under this Lease, whether
or not the Project shall be relet. In any such event Tenant
shall pay Landlord the Rent and all Additional Rent required to
be paid hereunder by Tenant up to the time of such event.
Thereafter:
(i) In the event of termination of the Lease,
Tenant, until the date which is the first to
occur of (a) the expiration of the Term or
(b) the expiration of the 15th Lease Year
subsequent to the date of termination, shall
be liable to Landlord as damages for Tenant's
default, the equivalent of the amount of the
Rent and Additional Rent which would be
payable under this Lease by Tenant if this
Lease were still in effect, less the net
proceeds of any reletting effected pursuant
to the provisions hereof, after deducting all
of Landlord's expenses in connection with
such reletting, including without limitation,
all repossession costs, brokerage and
management commissions, operating expenses,
legal expenses, reasonable attorneys' fees,
alterations costs, and expenses of
preparation of such reletting. The amount of
Additional Rent due in the event of
expiration or termination of this Lease shall
be equal to the Additional Rent paid to
Landlord in the year prior to the year of
termination divided into twelve equal monthly
installments. Tenant shall pay such damages
(herein called "deficiency") to the Landlord
on the days on which the net Rent would have
been payable under this Lease if this Lease
were still in effect, and the Landlord shall
be entitled to recover from Tenant each
deficiency as the same shall arise.
(ii) At any time after the expiration or
termination of this Lease, in lieu of
collecting any further deficiencies as
aforesaid, Landlord shall be entitled to
recover from Tenant, and Tenant shall pay to
Landlord, on demand, an amount equal to the
difference between the Rent which would have
accrued to Landlord under this Lease from the
date of termination to the date which is the
first to occur of (a) the expiration of the
Term or (b) the expiration of the 15th Lease
Year subsequent to the date of termination,
and the then fair and reasonable rental value
of the Premises for the same period as
provided in Section 25(f). Tenant shall
remain liable for any deficiencies not
previously recovered by Landlord.
(f) Value of Premises. If the Premises or any
part thereof be relet by Landlord for the unexpired Term, or any
part thereof, the amount of rent reserved upon such reletting
shall be deemed the fair and reasonable rental value for the part
or the whole of the Premises so relet during the term of the
reletting. Landlord agrees to make reasonable efforts to
mitigate its damages by listing the Premises with a licensed real
estate broker for reletting on terms and conditions acceptable to
Landlord, but Landlord shall have no obligation to relet the
Premises to any particular tenant or for any particular use,
including, without limitation, casino gaming.
(g) Additional Damages. If this Lease be
terminated, or if the Project is abandoned or becomes vacant, and
whether or not the Project be relet, Landlord shall be entitled
to recover from Tenant, and Tenant shall pay to Landlord, in
addition to any damages becoming due under this Section 25, the
following: an amount equal to all expenses, if any, including
reasonable attorneys' fees, incurred by Landlord in recovering
possession of the Project (whether or not litigation be commenced
in aid thereof), repairing any damage to the Project, and all
reasonable costs and charges for the care of said Project while
vacant, which damages shall be due and payable by Tenant to
Landlord at such time or times as such expenses are incurred by
Landlord. Tenant hereby expressly waives, as far as permitted by
law, the service of any notice of intention to re-enter provided
for in any statute, and except as is herein otherwise provided
Tenant, for and on behalf of itself and all persons claiming
through or under Tenant (including any leasehold mortgagee or
other creditor), also waives any and all right of redemption or
re-entry or repossession in case Tenant shall be dispossessed by
a judgment or by warrant of any court or judge or in case of re-
entry or repossession by Landlord or in case of any expiration or
termination of this Lease except as expressly provided in this
Lease. The terms "enter," "re-enter," "entry" or "re-entry" as
used in this Lease are not restricted to their technical legal
meanings.
(h) Waiver of Automatic Stay. In view of the
public interest in the integrity of the gaming process and the
involvement of the County and Landlord in the Project, in the
event of any voluntary or involuntary petition in bankruptcy
involving Tenant or New Guarantor, Tenant and New Guarantor
hereby waive, to the fullest extent permitted by law, any right
they may have to object to the waiver of vacation of the
automatic stay in all respects as to the rights of Landlord under
the Lease and the New Guarantees.
(i) Waiver of Jury Trial. Tenant hereby waives
all right to trial by jury in any action or proceeding hereafter
instituted by Landlord against Tenant with respect to this Lease
or the Project.
(j) Additional Remedies. In the event of any
breach by Tenant of any of the agreements, terms, covenants or
conditions contained in this Lease, Landlord shall have the right
to invoke any right and remedy allowed at law or in equity
including the right to seek specific performance of Tenant's
obligations under this Lease and to enjoin violations of this
Lease by Tenant.
(k) Landlord's Default. It shall be an event of
default on the part of Landlord (a "Landlord Default") if any one
or more of the events described in the following clauses (i)
through (iii) shall occur and be continuing after expiration of
the applicable notice and cure period provided for in such
clause:
(i) Landlord shall fail to make any payment which
Landlord agrees to make to or for the benefit
of Tenant pursuant to Section 2 or to
otherwise cure on a timely basis any
objection raised by Tenant under Section 2
which Landlord has theretofore agreed in
writing to cure, after 30 days prior written
notice to Landlord;
(ii) Landlord shall make a material
misrepresentation in any representation or
warranty provided to Tenant under Section
8(b) or to Assignee in the certificate to be
provided to Assignee pursuant to Section
1(d)(5), and such misrepresentation shall
materially and adversely affect any right or
benefit available to Tenant or Assignee under
this Lease; or
(iii)Landlord shall breach any express covenant of
Landlord under this Lease and shall fail to
cure such breach within 30 days after notice
from Tenant specifying the nature of such
breach, unless the same cannot be cured
within 30 days, in which event Landlord shall
not be deemed in default provided Tenant
commences the cure of such default within 30
days and thereafter diligently pursues such
cure to completion.
If a Landlord Default shall occur, Tenant shall have the right to
pursue any remedy available to Tenant at law or in equity on
account of such Landlord Default; provided, however, in no event
shall Tenant be entitled to (i) withhold, deduct or offset Rent
or Additional Rent, (ii) vacate or abandon the Project or close
the Casino (except pursuant to any express right of vacation or
closure granted Tenant under this Lease), (iii) seek or recover
consequential damages (such as for lost profits) from Landlord,
(iv) seek or recover damages or equitable relief in violation of
the provisions of Sections 20(c) or Section 22, or (v) terminate
this Lease (except pursuant to any express right of termination
granted Tenant under this Lease). Tenant hereby waives and
releases each of the claims specified in clauses (i) through (v)
hereof. In all events, any recovery of monetary damages (except
in connection with a breach of Section 10) by Tenant shall be
limited solely to the interest of Landlord in the Premises, which
shall include the Rentals and avails thereof.
26. Remedies Cumulative. Each right and remedy
provided for in this Lease shall be cumulative and shall be in
addition to every other right or remedy provided for in this
Lease or now or hereafter existing at law or in equity or by
statute or otherwise, and the exercise or beginning of the
exercise by Landlord or Tenant or any one or more of the rights
or remedies provided for in this Lease or now or hereafter
existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by Landlord or Tenant
of any or all other rights or remedies provided for in this Lease
or now or hereafter existing at law or in equity or by statute or
otherwise.
27. Surrender of Premises. Upon the expiration or
termination of this Lease, Tenant agrees to quit and surrender
the Premises, clean and free of any and all Hazardous Substances
released, spilled or discharged into or on the Project during the
Tenant's tenancy and in the same condition and repair as on the
date of execution hereof, and Tenant, at Landlord's option, shall
remove the Casino and any fixtures or structures installed or
located within the Premises or any public right of way at
Tenant's sole cost and expense and without expense to Landlord.
Tenant may, or, if directed by Landlord, shall remove all
personal property of Tenant from the Premises, including gaming
equipment and gaming machinery. If Tenant shall fail to remove
any of Tenant's property within 90 days after the receipt of
notice of termination or expiration of this Lease, Tenant's
property shall be deemed abandoned. If the Premises is not
surrendered as and when aforesaid, Tenant shall indemnify Tenant
against all loss or liability resulting from the delay of Tenant
in so surrendering the same including without limitation, any
claims made by any succeeding occupant founded on such delay.
Tenant's obligations under this Section shall survive the
expiration or sooner termination of the Term.
28. Cure of Tenant's Default. If Tenant shall fail to
make any payment or perform any act required hereunder to be made
or performed by Tenant then Landlord may, but shall be not be
obligated to, make such payment or perform such act with the same
effect as if made or performed by Tenant. Entry by Landlord upon
the Project for such purpose shall not waive or release Tenant
from any default or obligation hereunder. Tenant shall reimburse
Landlord for all sums paid and all costs incurred by Landlord in
performing the obligations of Tenant hereunder, including
attorneys' fees, upon Landlord's demand therefor which shall be
Additional Rent hereunder.
29. Notices. Unless otherwise indicated differently,
all notices, payments, requests, reports, information or demands
which any party hereto may desire or may be required to give to
any other party hereunder, shall be in writing and shall be
personally delivered or sent by a nationally recognized courier
service, telecopier or first-class certified or registered United
States mail, postage prepaid, return receipt requested, and sent
to the party at its address appearing below or such other address
as such party shall hereafter inform the other party hereto by
written notice given as aforesaid:
If to Landlord: St. Louis County Port Authority
Economic Council of St. Louis County
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Real Estate
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
Copies to: Economic Council of St. Louis County
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
St. Louis County
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: County Counselor
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
If to Southboat Southboat Limited Partnership
Ltd. Partnership: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇
Copies to: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Riezman & ▇▇▇▇▇▇, P.C.
7700 Bonhomme, ▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to Assignee: Ameristar Casino St. Louis, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
Copies to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President of Legal Affairs
Ameristar Casinos, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, Mag & Fizzell
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX: (▇▇▇)▇▇▇-▇▇▇▇
All notices, payments, requests, reports, information or demands
so given shall be deemed effective upon receipt, or if mailed,
upon receipt or the expiration of the third day following the
date of mailing, whichever occurs first, except that any notice
of change in address shall be effective only upon receipt by the
party to whom said notice is addressed. Any notices relating to
maintenance shall be given to those parties locally responsible
as hereinafter designated by the parties upon completion of the
anticipated improvements. Prior to the Assignment Date, Tenant
and Assignee shall receive a copy of each and every notice
delivered by Landlord to Tenant or Assignee.
30. Unavoidable Delay. As used in this Lease, the
term "Unavoidable Delay" shall mean any delay if and to the
extent caused by a fire, flood, tornado, earthquake, severe
inclement weather or other Act of God, strike, lockout or other
labor dispute, material breach of a contractual obligation by a
party not affiliated with Tenant, Assignee or New Guarantor
(provided Tenant or Assignee uses its best efforts to enforce its
contractual rights and to secure performance by another
contractor if such right is available to Tenant or Assignee under
such contract), unavailability of essential materials, war,
insurrection, civil disorder or a change in law or regulation or
an order by the Commission. In no event shall the Investigation
Deadline be changed due to any Unavoidable Delay. In no event
shall lack of funds, Tenant's failure to comply with Tenant's
contractual obligations or changes in the economy or marketplace
constitute a basis for asserting an Unavoidable Delay.
31. Arbitration of Certain Disputes.
(a) Arbitration of Specific Disputes. In the
event of a dispute between the parties pursuant to Sections 9,
10, 12, 14, 16 or 19, the issue requiring resolution may be
submitted by either party to expedited arbitration in accordance
with the following procedures:
(b) Arbitration Procedures. Arbitration shall be
commenced by written notice thereof from the party seeking
arbitration to the other party. Not later than 10 days after
delivery of such notice, each party shall select an independent
arbitrator who shall be an attorney licensed to practice law in
any state and practicing law for not less than 20 years. Not
later than 20 days after their selection, the two arbitrators
shall jointly select a third arbitrator having the same
qualifications as themselves. The arbitration panel shall meet
and determine the rules for submission and hearing of evidence
and so advise Landlord and Tenant not later than 10 days after
their selection. The panel shall convene and conduct a hearing
according to the rules established by them and shall render a
written decision which shall be binding on the parties not later
than 60 days after the date the third arbitrator has been
selected. The decision of the arbitration panel shall be final
and binding on the parties. Each party shall bear the fees and
expenses of its own arbitrator and shall share equally in the
payment of the fees and expenses of the third arbitrator.
32. Estoppels. Each party acknowledges that from time
to time the other party may request, for the benefit of third
parties, information relating to the effectiveness of this Lease
and the New Guarantees, whether this Lease or the New Guarantees
have been modified or amended, the status of payments of Rent and
Additional Rent due hereunder, whether an Event of Default or a
Landlord Default has occurred and is continuing, and other
information reasonably and customarily required by lenders,
accountants and other parties having an interest in the Project,
or in Landlord, Tenant or New Guarantor and their respective
operations. Each party agrees to respond in writing to any
request it may receive from the other party within 10 days after
its receipt of such request, and to provide all such requested
information.
33. Relationship of Parties. Nothing contained in
this Lease shall be deemed to constitute or be construed or
implied to create the relationship of principal and agent,
partnership, joint venture or any other relationship between the
parties hereto, other than the relationship of the landlord and
tenant. The term "Landlord" as used in this Lease means only the
owner of the current interest of Landlord in the Premises or, as
the case may be, the successor thereto from time to time.
34. No Broker. Tenant covenants, warrants and
represents to Landlord that there was no broker instrumental in
consummating the Assignment and that no conversations or prior
negotiations were had by Tenant with any broker in connection
therewith. Tenant agrees to indemnify and hold the Landlord
harmless against and from all liabilities, including reasonable
attorneys' fees, arising from any claims for brokerage
commissions or finders' fees resulting from or arising out of any
conversations or negotiations had by Tenant directly with any
broker.
35. Conflict of Interest. The parties agree to abide
by all Governmental Requirements relating to conflict of
interest. Additionally, but not in limitation of the foregoing,
no member, officer, commissioner or employee of Landlord or any
branch of County government who has any power of review or
approval of any of the undertakings herein, shall participate in
any decisions relating thereto which affect his/her personal
interests or the interests of any corporation or partnership in
which he or she is directly or indirectly interested. No member,
official or employee of Landlord shall have any personal interest
direct or indirect, in this Lease, nor participate in any
decisions relating thereto which affect his or her personal
interests or the interests of any corporation or partnership in
which he or she is directly or indirectly interested. In the
construction and/or operation of the Project, Tenant shall not
knowingly, after due inquiry, employ or contract with any person
if a member of his or her immediate family is a member, officer,
commissioner or employee of Landlord or any branch of County
government in an administrative capacity, by which is meant those
who have selection, hiring, supervisory or operational
responsibility for the work to be performed pursuant to this
Lease. For the purposes of this section, "immediate family"
includes: wife, husband, son, daughter, mother, father, brother,
sister, brother-in-law, sister-in-law, father-in-law, mother-in-
law, aunt, uncle, niece, nephew, step-parent and stepchild.
36. Entire Lease. This Lease sets forth the entire
agreement between the parties. There are no understandings,
agreements, statements, promises, or representations or
warranties, express or implied, in respect of the Property, the
Project or this Lease which are not specified herein. This Lease
shall not be modified, amended or supplemented except by a
writing subscribed to by the party to be charged, nor may this
Lease be canceled by Tenant or the Project surrendered except in
accordance with the express provisions of this Lease.
37. Survival of Covenants. All representations,
warranties and indemnities set forth in this Lease shall survive
the execution hereof.
38. Binding Effect. This Lease binds the parties
hereto and inures to the benefit of their respective heirs,
personal representatives, successors or assigns.
39. Time of the Essence. Time is of the essence with
respect to the performance of this Lease and each and every
provision contained herein.
40. Venue. If and in the event of a dispute arising
hereunder, venue shall be vested in the Circuit Court of St.
Louis County, State of Missouri. Tenant acknowledges that it has
negotiated this Lease in the County, and has made numerous
business contacts and entered into agreements relating to real
estate and other matters sufficient to confer jurisdiction of the
courts of St. Louis County, State of Missouri.
41. Authorization and Capacity. The parties hereto
represent to each other that each has the full right, power and
authority to enter into this Lease and to fully perform its
obligations. The persons executing this Lease warrant and
represent that each has the authority to execute in the capacity
stated and to bind the parties hereto.
42. Third-Party Beneficiaries. Subject only to the
provisions of Sections 1(d) and (f), Landlord and Tenant are the
only parties to this Lease and the only parties capable of or
entitled to the enforcement of its provisions. Each party
confirms that no other parties are intended to be third party
beneficiaries of any covenant or provision of this Lease.
Notwithstanding the foregoing provisions of this Section 42,
Tenant acknowledges and agrees that the County shall be an
intended third party beneficiary of Tenant's designation of the
County as the "home dock" for the Project under Section 13.
43. Severability. In the event any provision of this
Lease is rendered void or unenforceable by a court of competent
jurisdiction, the remaining provisions of this Lease shall be
construed so as to constitute a complete agreement, and this
Lease, as so reformed, shall remain in full force and effect.
44. Non-Waiver Provision. Failure by either party
hereto, at any time, to require the performance by the other of
any term of this Lease, shall not in any way effect the right of
either party to enforce such terms, nor shall any waiver by
either party of any term hereof be taken or held to be a waiver
of any other provision of this Lease. No waiver of any term or
provision of this Lease shall be effective unless the same is in
writing, signed by the parties hereto.
45. Governing Law. This Lease is entered into in the
State of Missouri and shall be construed, enforced and governed,
as to both validity and performance, in accordance with the laws
of the State of Missouri and all of the rights and obligations of
the parties hereunder shall be determined in pursuant to the laws
of the State of Missouri.
46. Recording of Lease. From and after the
Commencement Date, either party may, at its own expense, cause a
memorandum of this Lease, approved by the other party, to be
recorded in the Office of the Recorder of Deeds for the County of
St. Louis.
47. Attachments. All exhibits attached to this Lease
are incorporated herein and made part hereof by reference.
48. Headings. The captions, headings and arrangements
in this Lease are for convenience only and do not in any way
define, limit or modify the terms or provisions hereof.
49. Number and Gender of Words. Whenever the singular
number is used in this Lease, the same shall include the plural
where appropriate and words of any gender shall include the other
gender where appropriate.
50. Business Days. Except as provided in Section 11,
whenever it is provided in this Lease that an event shall occur
on a day which is a Saturday, Sunday or legal holiday in the
State of Missouri, such event shall occur instead on the next
business day.
51. Multiple Counterparts. This Lease may be executed
in a number of identical counterparts and if so executed, each
such counterpart is deemed an original for all purposes, and all
such counterparts shall collectively constitute one Lease.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Lease as the date first above written.
THIS LEASE CONTAINS A BINDING ARBITRATION PROVISION
WHICH MAY BE ENFORCED BY THE PARTIES
LANDLORD:
ST. LOUIS COUNTY PORT AUTHORITY
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chair
APPROVED AS TO FORM
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
General Counsel, Economic Council
of St. Louis County
TENANT:
SOUTHBOAT LIMITED PARTNERSHIP
By: Southboat ▇▇▇▇▇, Inc., its
general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: President of
Southboat ▇▇▇▇▇, Inc., Its
General Partner
SCHEDULE OF ATTACHMENTS
ATTACHMENT A
Description of the Property
ATTACHMENT B
Site Plan of the Premises
ATTACHMENT C
Diagram of Adjacent Parcel
Attachment D-1
New Project Proposal Preliminary Construction Documents
Attachment D-2
New Project Proposal Employment and Contracting Policies
Attachment E
Guarantee of Minimum Rent
Attachment F
Guarantee of Completion
Attachment G
Assignment and Assumption Agreement
Attachment H
Release of Landlord and St. Louis County
Attachment I
License and Indemnity for Early Entry onto the Premises
Attachment J
Legal Description of Premises
ATTACHMENT K
Adjacent Parcel Buffer Zone
ATTACHMENT E
GUARANTEE OF MINIMUM RENT
FOR VALUABLE CONSIDERATION, the receipt of which is
hereby acknowledged, and to induce the ST. LOUIS COUNTY PORT
AUTHORITY, a public body corporate and politic of the State of
Missouri ("Landlord") to approve the proposed assignment of the
right, title and interest of Southboat Limited Partnership, a
Missouri limited partnership ("Tenant") in that certain Amended
and Restated Lease and Development Agreement, by and between
Tenant and Landlord, dated as of February ___, 2000(the "Lease")
to Ameristar Casino St. Louis, Inc., a Missouri corporation
("Assignee"), AMERISTAR CASINOS, INC., a Nevada corporation
("Guarantor"), having its principal place of business at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
does hereby unconditionally covenant and agree with Landlord, its
successors and assigns, as follows:
1. Terms defined in the Lease and used in this
Guarantee of Minimum Rent (the "Rent Guarantee") shall have the
same meaning herein as so defined.
2. If an Event of Default shall occur under Section
25(a)(i) of the Lease at any time during the Guarantee Period (as
hereinafter defined) due to the failure of Tenant to pay, within
ten (10) days after notice of nonpayment (unless notice shall no
longer be required pursuant to such subsection), any component or
installment of Minimum Rent due Landlord pursuant to the Lease,
or if the Lease shall be terminated at any time during the
Guarantee Period due to an Event of Default, then Guarantor will
well and truly immediately pay Landlord on demand, in cash, the
full sum of unpaid Minimum Rent due Landlord under the Lease for
the remainder of the Guarantee Period (and said sum will not be
reduced by application of any "present value" formula), not to
exceed the total amount of all Minimum Rent allocable to the
Guarantee Period (the "Guaranteed Amount"). As used in this Rent
Guarantee, the term "Guarantee Period" shall mean that period
commencing on the Commencement Date and ending on the earlier to
occur of (a) the last day of the 15th Lease Year occurring after
the Commencement Date and (b) the date on which the Lease is
terminated in accordance with its terms (other than due to an
Event of Default). Notwithstanding the first sentence of this
Section 2, in lieu of paying to Landlord in one lump sum the
entire Guaranteed Amount, Guarantor may elect to pay to Landlord
the Minimum Rent as and when the same would have otherwise been
due under the Lease through the remainder of the Guarantee Period
had the Lease not been terminated or had an Event of Default
under Section 25(a)(i) not occurred. Notwithstanding the
foregoing, in the event of an Event of Default under this Rent
Guarantee, Guarantor's option to make installment payments of
Minimum Rent shall be null and void, and Guarantor shall
immediately pay to Landlord, on demand, in cash, the full sum of
the Guaranteed Amount due but unpaid.
3. This Rent Guarantee constitutes an absolute and
unconditional guarantee of payment of Minimum Rent accruing
during the Guarantee Period and is not a guarantee of collection.
It shall be enforceable against Guarantor, its successors and
assigns, without the necessity for any suit or proceedings by
Landlord against Tenant, its successors and assigns, and without
the necessity of any notice of acceptance of this Rent Guarantee.
In addition, Guarantor further waives any right Guarantor may
have to seek a reduction in, or a credit against payment of, the
Guaranteed Amount, or any portion thereof, for any reason other
than payment of the Guaranteed Amount; provided, however, that
the Guaranteed Amount shall be reduced by an amount equal to any
rent or license or operating fees actually received by Landlord
during the Guarantee Period from any new tenant, licensee or
operator of the Premises procured by or for Landlord, after
deduction of (i) all Rent and Additional Rent accrued under the
Lease but unpaid to Landlord, and (ii) Landlord's reasonable
expenses incurred in the enforcement of Tenant's obligations
under the Lease and Guarantor's obligations under this Rent
Guarantee, and in reletting or licensing the use of the Premises,
including, without limitation reasonable brokerage fees and
commissions and reasonable attorneys' fees and expenses.
4. Guarantor agrees that the validity of this Rent
Guarantee and the obligations of Guarantor shall in no way be
terminated, affected or impaired by reason of the assertion or
the failure or delay to assert by Landlord against Tenant, or
Tenant's successors and assigns, any of the rights or remedies
reserved to Landlord pursuant to the provisions of the Lease.
The single or partial exercise of any right, power or privilege
under this Rent Guarantee shall not preclude any other or the
further exercise thereof or the exercise of any other right,
power or privilege by Landlord.
5. Failure of Guarantor to honor any demand for
payment under this Rent Guarantee within ten (10) days after
notice thereof by Landlord (which notice shall not be required
more than twice during any twelve month period) and to make
payment of any sums due hereunder within 5 days after delivery of
such notice, or the breach by Guarantor of any representation or
warranty of Guarantor hereunder, shall constitute an Event of
Default hereunder.
6. This Rent Guarantee shall not be affected and the
liability of the Guarantor shall not be extinguished or
diminished (a) by Landlord's receipt, application or release of
security given for the performance and observation of the
covenants and conditions in the Lease to be performed or observed
by Tenant, its successors and assigns, including any sums paid by
Guarantor under the Guarantee of Completion issued by Guarantor
to Landlord on the Assignment Date (the "Completion Guarantee"),
(b) by the discharge of Tenant's liabilities through bankruptcy,
insolvency or any similar debt relief proceedings, (c) by reason
of sums paid or payable to Landlord from the proceeds of any
insurance policy or condemnation award (unless the Lease is
terminated incident to condemnation), or (d) by any extensions,
renewals, amendments, indulgences, modifications, transfers or
assignments in whole or in part of the Lease, whether or not
notice thereof is given to Guarantor.
7. Guarantor agrees that the liability of Guarantor
is co-extensive with that of Tenant and also joint and several.
8. Landlord's acceptance of a note or collateral of
Tenant or Guarantor shall not constitute the full cash payment
required herein. This Rent Guarantee is given in addition to all
other guarantees which may pertain to Tenant's indebtedness, and
is not subordinate to any other guarantees. Landlord's rights
under all guarantees, including this Rent Guarantee, shall be
cumulative and independently enforceable. It shall not be a
condition to the enforcement of this Rent Guarantee that any
other guarantees or collateral be resorted to by Landlord. Any
such collateral or guarantee, including the Completion Guarantee,
may be applied by Landlord in satisfaction of any obligation or
liability of Tenant under the Lease without thereby impairing,
reducing, diminishing or otherwise modifying the obligations of
Guarantor under this Rent Guarantee.
9. In order to induce Landlord to approve the
proposed assignment of Tenant's right, title and interest in the
Lease to Assignee, Guarantor makes the following representations
and warranties to Landlord:
(a) Guarantor is duly formed and validly existing as a
Nevada corporation;
(b) the execution and delivery of this Rent Guarantee
and the performance by Guarantor of Guarantor's obligations
hereunder have been duly authorized by all requisite corporate
action;
(c) this Rent Guarantee constitutes the legal, valid
and binding obligation of Guarantor and is enforceable against
Guarantor in accordance with its terms;
(d) no litigation or regulatory proceedings are
pending or, to the best of Guarantor's knowledge, threatened
against Guarantor which, if adversely determined, would likely
have a material adverse impact on Guarantor or on this Rent
Guarantee;
(e) Guarantor is not a party to, and neither Guarantor
nor Guarantor's properties, real or personal, are subject to, any
agreement, order, proceeding, ruling or other matter in conflict
with any provision of this Rent Guarantee or which materially and
adversely affects its ability to perform its obligations
hereunder;
(f) Guarantor is solvent and is not a party to any
assignment for the benefit of creditors or bankruptcy proceeding;
and
(g) Guarantor is not in material default of any
contract or agreement to which it is a party which materially and
adversely affects Guarantor's ability to perform its obligations
under this Rent Guarantee.
10. Guarantor agrees that it will, at any time and
from time to time, within ten (10) business days following
written request by Landlord, execute, acknowledge and deliver to
Landlord a statement certifying that this Rent Guarantee is
unmodified and in full force and effect (or if there have been
modifications, that the same is in full force and effect as
modified and stating such modifications). Guarantor agrees that
such certificate may be relied on by third parties. Should
Landlord be obligated by any bankruptcy or other law in
connection with any bankruptcy proceeding of Tenant or Guarantor
to repay to Tenant or to Guarantor or to any trustee, receiver or
other representative or any of them, any amounts previously paid
to Landlord, its successors and assigns, this Rent Guarantee
shall be reinstated in the amount of such repayments.
11. As a further inducement to Landlord to approve the
proposed assignment of Tenant's right, title and interest in the
Lease to Assignee and in consideration thereof, Landlord and
Guarantor covenant and agree that in any action or proceeding
brought on, under or by virtue of this Rent Guarantee, Landlord
and Guarantor shall and do hereby waive trial by jury. Without
regard to principles of conflicts of laws, the validity,
interpretation, performance and enforcement of this Rent
Guarantee shall be governed by and construed in accordance with
the laws of the State of Missouri, and Guarantor hereby consents
to jurisdiction and venue in the Circuit Court of St. Louis
County, Missouri, or in the United States District Court for the
Eastern District of Missouri, St. Louis, Missouri, wherein
Landlord at its election may bring an action for the enforcement
of this Rent Guarantee. If Landlord commences an action in such
court, Guarantor hereby agrees that it will submit to the
personal jurisdiction of such court and will not attempt to have
such action dismissed, abated or transferred on the ground of
forum non conveniens.
12. Guarantor covenants and agrees that for so long as
the restrictive covenant described in Section 10(c) of the Lease
shall remain in effect as against Tenant, Guarantor shall not
participate in any manner in the ownership, sponsorship, control,
management, operation or use of any riverboat gaming facility
along either the Illinois or Missouri banks of the Mississippi
River from the southern boundary of the City of St. Louis to the
northern boundary of Jefferson County, Missouri. Guarantor
acknowledges that the restrictive covenant contained in this
Section 12 (and made by the Tenant under the Lease) is reasonable
under all of the circumstances. The provisions of this Section
12 shall survive any termination of this Rent Guarantee.
13. Guarantor covenants and agrees to pay interest to
Landlord on any and all sums due Landlord hereunder which remain
unpaid for more than five (5) days after delivery of Landlord's
demand for payment, commencing on the date such payment is due,
at the rate of two percent (2%) in excess of the from time to
time publicly announced prime rate of interest of The Bank of
America.
14. If any provision or application of this Rent
Guarantee is invalid, unenforceable or illegal for any reason,
the parties agree that such invalid, unenforceable or illegal
provision or application shall be deemed modified to the extent,
but only to the extent, required to make such portion or
application enforceable, and that no such modification shall be
deemed to affect the remainder of this Rent Guarantee.
15. Unless otherwise indicated differently, all
notices, payments, requests, reports, information or demands
which any party hereto may desire or may be required to give to
any other party hereunder, shall be in writing and shall be
personally delivered or sent by a nationally recognized courier
service, telecopier or first-class certified or registered United
States mail, postage prepaid, return receipt requested, and sent
to the party at its address appearing below or such other address
as such party shall hereafter inform the other party hereto by
written notice given as aforesaid:
If to Guarantor: Ameristar Casinos, Inc.
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Attention: President
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President of Legal
Affairs
Ameristar Casinos, Inc.
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FAX: (▇▇▇) ▇▇▇-▇▇▇▇
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▇▇▇▇▇▇▇, Mag & Fizzell
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Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Landlord: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Attention: Director of Real
Estate
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: Economic Council of St. Louis
County
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Attention: General Counsel
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
St. Louis County
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Attention: County Counselor
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
All notices, payments, requests, reports, information
or demands so given shall be deemed effective upon receipt, or if
mailed, upon receipt or the expiration of the third day following
the date of mailing, whichever occurs first, except that any
notice of change in address shall be effective only upon receipt
by the party to whom said notice is addressed.
16. Guarantor hereby indemnifies and holds Landlord
harmless from and against any attorneys' fees and the expenses of
such attorneys, costs of collection and court costs which may be
incurred by Landlord in the enforcement of its rights hereunder,
whether or not litigation is commenced, but only if Landlord is
the prevailing party in any such enforcement action.
IN WITNESS WHEREOF, Guarantor has executed this Rent
Guarantee this ___ day of _____________.
AMERISTAR CASINOS, INC.
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
ATTACHMENT F
GUARANTEE OF COMPLETION
FOR VALUABLE CONSIDERATION, the receipt of which is
hereby acknowledged, and to induce the ST. LOUIS COUNTY PORT
AUTHORITY, a public body corporate and politic of the State of
Missouri ("Landlord") to approve the proposed assignment of the
right, title and interest of Southboat Limited Partnership, a
Missouri limited partnership ("Tenant") in that certain Amended
and Restated Lease and Development Agreement, by and between
Tenant and Landlord, dated as of February ___, 2000 (the "Lease")
to Ameristar Casino St. Louis, Inc., a Missouri corporation
("Assignee"), AMERISTAR CASINOS, INC., a Nevada corporation
("Guarantor"), having its principal place of business at ▇▇▇▇
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does hereby unconditionally covenant and agree with Landlord, its
successors and assigns, as follows:
1. Terms defined in the Lease and used in this
Guarantee of Completion (the "Completion Guarantee") shall have
the same meaning herein as so defined.
2. If Tenant shall abandon the Project after
commencement of any Work, or, if for reasons other than an
Unavoidable Delay or a delay caused by Landlord or St. Louis
County, any lien for services, labor or materials shall be filed
against the Property or the Project on account of the Work, and
such lien shall not be timely discharged or, in the event Tenant
or Guarantor shall elect to contest the lien in good faith and by
appropriate proceedings without providing security to Landlord in
accordance with Section 9(d) of the Lease, or in the event the
Work shall be defective in any material respect or not in
conformity with the Plans in any material respect and Tenant
shall fail or refuse to correct the Work after 30 days' prior
written notice, then Guarantor, at Guarantor's sole risk, cost
and expense, and subject to all of the provisions of the Lease
governing the Work, will well and truly immediately perform or
correct the Work, or pay and discharge the lien claim, as the
case may be. Guarantor shall pay all costs of the Work not paid
by Tenant and reimburse Landlord for any costs reasonably
incurred by Landlord in completing or correcting the Work or in
paying the cost of any lien claim or the defense thereof, as the
case may be.
3. This Completion Guarantee constitutes an absolute
and unconditional guarantee of completion of the Work in
accordance with the requirements of the Lease and payment of all
costs incurred by Tenant and/or Guarantor for or in connection
with the Work. This Completion Guarantee shall be enforceable
against Guarantor, its successors and assigns, without the
necessity for any suit or proceedings by Landlord against Tenant,
its successors and assigns, and without the necessity of any
notice of non-payment, non-performance or non-observance or any
notice of acceptance of this Completion Guarantee or any other
notice or demand to which Guarantor might otherwise be entitled,
all of which Guarantor hereby expressly waives. Nothing
contained in this Section 3, however, shall impair the right of
Guarantor to contest the validity of any claim for the cost of
labor or materials or to pursue any claim against a contractor,
subcontractor or supplier in connection with the Work; provided,
however, that in any such event the right of Guarantor to contest
or pursue any such claim shall be conditioned on delivery to
Landlord of reasonably adequate cash security to cover the cost
of the claim, together with reasonable attorneys fees and
expenses, or the reasonable cost required to complete or correct
the Work, as the case may be.
4. Guarantor agrees that the validity of this
Completion Guarantee and the obligations of Guarantor shall in no
way be terminated, affected or impaired by reason of the
assertion or the failure or delay to assert by Landlord against
Tenant, or Tenant's successors and assigns, any of the rights or
remedies reserved to Landlord pursuant to the provisions of the
Lease. The single or partial exercise of any right, power or
privilege under this Completion Guarantee shall not preclude any
other or the further exercise thereof or the exercise of any
other right, power or privilege by Landlord.
5. Failure of Guarantor to honor any demand for
performance or payment under this Completion Guarantee and to
make immediate payment of any sums due hereunder, or the breach
by Guarantor of any representation or warranty of Guarantor
hereunder, shall constitute an Event of Default hereunder.
6. This Completion Guarantee shall not be affected
and the liability of the Guarantor shall not be extinguished or
diminished (a) by Landlord's receipt, application or release of
security given for the performance and observation of the
covenants and conditions in the Lease to be performed or observed
by Tenant, its successors and assigns, including any sums paid by
Guarantor under the Guarantee of Minimum Rent to be issued by
Guarantor to Landlord on the Commencement Date (the "Rent
Guarantee"), (b) by the discharge of Tenant's liabilities through
bankruptcy, insolvency or any similar debt relief proceedings,
(c) by reason of sums paid or payable to Landlord from the
proceeds of any insurance policy or condemnation award (unless
the Lease is terminated incident to condemnation), or (d) by any
extensions, renewals, amendments, indulgences, modifications,
transfers or assignments in whole or in part of the Lease,
whether or not notice thereof is given to Guarantor. If the
Lease is terminated in accordance with its terms (other than due
to an Event of Default) prior to completion of the Work, the
obligations of Guarantor under this Completion Guarantee shall
thereafter be limited to securing the obligation of Tenant to pay
all costs incurred by Tenant in connection with the Work and to
remove all property of Tenant from the Premises in accordance
with the terms of the Lease.
7. Guarantor agrees that it shall have no rights of
indemnification or subrogation, and that Guarantor shall
subordinate its rights of recourse, against Tenant by reason of
any indebtedness or sums due to Guarantor, unless and until the
obligations secured by this Completion Guarantee are fully
performed. Guarantor agrees that it shall not assert any claim
which it has or may have against Tenant, including any claims
under this Completion Guarantee, until the obligations of Tenant
under the Lease in respect of the Work are fully satisfied and
discharged. The liability of Guarantor is co-extensive with that
of Tenant and also joint and several.
8. Landlord's acceptance of a note or collateral of
Tenant shall not constitute the full cash payment required
herein. This Completion Guarantee is given in addition to all
other guarantees which may pertain to Tenant's indebtedness or
obligations, and is not subordinate to any other guarantees.
Landlord's rights under all guarantees, including this Completion
Guarantee, shall be cumulative and independently enforceable. It
shall not be a condition to the enforcement of this Guarantee
that any other guarantees or collateral be resorted to by
Landlord. Any such collateral or guarantee, including the Rent
Guarantee, may be applied by Landlord in satisfaction of any
obligation or liability of Tenant under the Lease without thereby
impairing, reducing, diminishing or otherwise modifying the
obligations of Guarantor under this Completion Guarantee.
9. In order to induce Landlord to approve the
proposed assignment of Tenant's right, title and interest in the
Lease to Assignee, Guarantor makes the following representations
and warranties to Landlord:
(a) Guarantor is duly formed and validly existing as a
Nevada corporation;
(b) the execution and delivery of this Completion
Guarantee and the performance by Guarantor of Guarantor's
obligations hereunder have been duly authorized by all requisite
corporate action;
(c) this Completion Guarantee constitutes the legal,
valid and binding obligation of Guarantor and is enforceable
against Guarantor in accordance with its terms;
(d) no litigation or regulatory proceedings are
pending or, to the best of Guarantor's knowledge, threatened
against Guarantor which, if adversely determined, would likely
have a material adverse impact on Guarantor or on this Completion
Guarantee;
(e) Guarantor is not a party to, and neither Guarantor
nor Guarantor's properties, real or personal, are subject to, any
agreement, order, proceeding, ruling or other matter in conflict
with any provision of this Completion Guarantee or which
materially and adversely affects its ability to perform its
obligations hereunder;
(f) Guarantor is solvent and is not a party to any
assignment for the benefit of creditors or bankruptcy proceeding;
and
(g) Guarantor is not in material default of any
contract or agreement to which it is a party which materially and
adversely affects Guarantor's ability to perform its obligations
under this Completion Guarantee.
10. Guarantor agrees that it will, at any time and
from time to time, within ten (10) business days following
written request by Landlord, execute, acknowledge and deliver to
Landlord a statement certifying that this Completion Guarantee is
unmodified and in full force and effect (or if there have been
modifications, that the same is in full force and effect as
modified and stating such modifications). Guarantor agrees that
such certificate may be relied on by third parties. Should
Landlord be obligated by any bankruptcy or other law to repay to
Tenant or to Guarantor or to any trustee, receiver or other
representative or any of them, any amounts previously paid to
Landlord, its successors and assigns, this Completion Guarantee
shall be reinstated in the amount of such repayments.
11. As a further inducement to Landlord to approve the
proposed assignment of Tenant's right, title and interest in the
Lease to Assignee and in consideration thereof, Landlord and
Guarantor covenant and agree that in any action or proceeding
brought on, under or by virtue of this Completion Guarantee,
Landlord and Guarantor shall and do hereby waive trial by jury.
Without regard to principles of conflicts of laws, the validity,
interpretation, performance and enforcement of this Completion
Guarantee shall be governed by and construed in accordance with
the laws of the State of Missouri, and Guarantor hereby consents
to jurisdiction and venue in the Circuit Court of St. Louis
County, Missouri, or in the United States District Court for the
Eastern District of Missouri, St. Louis, Missouri, wherein
Landlord at its election may bring an action for the enforcement
of this Completion Guarantee.
12. Guarantor hereby indemnifies and holds Landlord
harmless from and against any attorneys' fees and the expenses of
such attorneys, costs of collection and court costs which may be
incurred by Landlord in the enforcement of its rights hereunder,
whether or not litigation is commenced, but only if Landlord is
the prevailing party in any such enforcement action.
13. Guarantor covenants and agrees to pay interest to
Landlord on any and all sums due Landlord hereunder which remain
unpaid for more than five (5) days after delivery of Landlord's
demand for payment, commencing on the date such payment is due,
at the rate of two percent (2%) in excess of the from time to
time publicly announced prime rate of interest of The Bank of
America.
14. If any provision or application of this Completion
Guarantee is invalid, unenforceable or illegal for any reason,
the parties agree that such invalid, unenforceable or illegal
provision or application shall be deemed modified to the extent,
but only to the extent, required to make such portion or
application enforceable, and that no such modification shall be
deemed to affect the remainder of this Completion Guarantee.
15. Unless otherwise indicated differently, all
notices, payments, requests, reports, information or demands
which any party hereto may desire or may be required to give to
any other party hereunder, shall be in writing and shall be
personally delivered or sent by a nationally recognized courier
service, telecopier or first-class certified or registered United
States mail, postage prepaid, return receipt requested, and sent
to the party at its address appearing below or such other address
as such party shall hereafter inform the other party hereto by
written notice given as aforesaid:
If to Guarantor: Ameristar Casinos, Inc.
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▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President of Legal
Affairs
Ameristar Casinos, Inc.
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FAX: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, Mag & Fizzell
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Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Landlord: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Attention: Director of Real
Estate
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: Economic Council of St. Louis
County
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
St. Louis County
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: County Counselor
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
All notices, payments, requests, reports, information
or demands so given shall be deemed effective upon receipt, or if
mailed, upon receipt or the expiration of the third day following
the date of mailing, whichever occurs first, except that any
notice of change in address shall be effective only upon receipt
by the party to whom said notice is addressed.
IN WITNESS WHEREOF, Guarantor has executed this
Completion Guarantee this ___ day of _______________.
AMERISTAR CASINOS, INC.
By:
Name:
Title:
ATTEST:
By:
Name:
Title: