EXHIBIT 10.12
_____________
STOCK PURCHASE AGREEMENT
THIS AGREEMENT made as of this 28th day of July, 2000, between
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(hereinafter referred to individually as a "Buyer" and
collectively as the "Buyers"), and Shamrock Holdings Group, Inc.
(hereinafter referred to as "Shamrock") and American Gaming &
Entertainment, Ltd. ("AGEL") which is joining as a party to this
Agreement only for the purpose of complying with Sections 3 and 4
hereof.
Recitals
A. The substantively consolidated bankruptcy estate of
The ▇▇▇▇▇▇▇ Funding, Inc., et al. (the "Estate") and Shamrock
together own 5,923,454 shares of voting, $0.01 par value common
stock of AGEL, 55,982.61 shares of Series A Preferred Stock (which
is convertible into 1,399,565 shares of common stock) and 4,000
shares of each Series C, D and E Preferred Stock (which are
convertible as of July 21, 2000 into 360,588,361 shares of common
stock pursuant to letter agreement attached hereto as Exhibit
"A"), as their interests may appear;
B. The Buyers desire to purchase all of the stock (on a
fully converted based) owned by Shamrock, upon the terms and
conditions hereinafter set forth (the "Stock").
C. Shamrock is willing to sell the Stock to the Buyers on
the terms and conditions hereinafter set forth.
D. The parties hereto desire to establish their mutual
rights and obligations under this Agreement.
NOW, THEREFORE, in consideration of mutual covenants contained
herein and other valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. Purchase Price. The purchase price for the sale of
the Stock to the Buyers shall be $1,800.00 (the "Purchase Price")
payable in accordance with the terms of this Agreement.
2. Closing Matters. The closing (the "Closing") on the
transactions contemplated by this Agreement shall take place on or
before August 31, 2000 (the "Closing Date") at a time and
location mutually acceptable to the parties. At the Closing,
Shamrock shall deliver to the Buyers the certificates in
Shamrock's possession representing a portion of the Stock and an
affidavit of lost certificate(s) with respect to the
certificates not in Shamrock's possession, and all certificates
in Shamrock's possession shall be duly endorsed on the reverse
side thereof by a duly authorized officer. The Buyers shall
deposit with the Escrow Agent cash in an amount equal to the
Purchase Price pursuant to the Escrow Agreement.
3. Post Closing Matters. Immediately following Closing,
AGEL's Board of Directors shall be expanded to not less than
three members (as determined by the Buyers) and the Board of
Directors shall fill said vacancies with individuals designated
by the Buyers.
4. Right of Setoff. The Escrow Amount shall be
reduced and paid to Buyers as a result of any damages asserted
against, imposed upon or incurred by AGEL or the Buyers,
directly or indirectly, by reason of or resulting from any of
the following occurrences:
4.01 Other than as set forth in the Exceptions
Schedule which is attached hereto as Exhibit "B", AGEL is a
party to any contract, lease, agreement or other undertaking.
Except as set forth in the Exceptions Schedule, any party to any
contract, lease, agreement or other undertaking with AGEL has
any claim against AGEL.
4.02 Except for the requirements of applicable
federal and state securities laws and the Bankruptcy Court
Approval and the approval of the Indiana Gaming Commission,
required, a consent or approval of, or filing or registration
with, any governmental or regulatory authority is required in
connection with the performance of the terms of this Agreement.
4.03 Except as disclosed in the Exceptions
Schedule, any of AGEL's tax returns and reports required by law
to be filed have not been duly filed, and any taxes,
assessments, fees and other governmental charges have not been
paid or adequately reserved against.
4.04 Except as disclosed in the Exceptions
Schedule:
(a) there is any action, proceeding, claim or
investigation pending against AGEL or to which any of its assets
or properties are subject before any court or any governmental
department, commission, board, bureau, agency or
instrumentality; or
(b) there is any outstanding order, writ,
injunction or decree of any court, governmental department,
commission, board, bureau, agency or instrumentality, or any
arbitration award against AGEL.
4.05 AGEL's authorized capital stock exceeds
3,000,000,000 shares of common stock $.01 par value or 1,000,000
shares of preferred stock, of which more than 12,561,750 shares
(pre-conversion) of common stock are issued and outstanding or
of which more than 67,982.61 shares (pre-conversion) of
preferred stock are issued and outstanding. Except as set forth
in the Exceptions Schedule, there are any outstanding options,
warrants or other rights to subscribe for, purchase or receive
shares of AGEL common stock or preferred stock or any other
securities convertible into AGEL common stock or preferred
stock.
4.06 Except as set forth in the Exceptions
Schedule, any of AGEL's current or former officers, directors or
employees has any claim against it except for salaries or other
ordinary expenses, or AGEL is obligated to any of such persons
in any way or for any amount except for salaries, wages or
ordinary expenses. One-half of the $125,000 severance payment
payable on termination of the employment of J. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ("Wellington") will be satisfied by Shamrock on
January 31, 2001, from the reserve account which was established
by Shamrock for said severance payment, subject to the terms of
the Employment Agreement between AGEL and Wellington dated as of
December 31, 1999 (the "Wellington Employment Agreement").
Buyers agree to cause AGEL to pay the other half of said
severance payment on January 31, 2001, which amount shall not be
paid out of the Escrow Amount (as defined below) but rather from
other post-closing funds of AGEL. AGEL will pay to Wellington
the remainder of his base salary under the Wellington Employment
Agreement in a lump sum payment on September 30, 2000, from the
Escrow Amount. The Buyers agree to cause AGEL to pay to
Wellington on September 30, 2000, $1,500 for the car and rent
allowance which amount shall not be paid out of the Escrow
Amount but rather from post-closing funds of AGEL.
4.07 Except as set forth in the Exceptions
Schedule, any agent, broker, investment banker, person or firm
acting on behalf of AGEL is or will be entitled to any broker's
or finder's fee or any other commission or fee, directly or
indirectly, in connection with any of the transactions
contemplated hereby.
4.08 AGEL owns stock or securities evidencing an
ownership interest in any corporation, business trust, firm or
business which may be considered a subsidiary, except as set
forth on the Exceptions Schedule.
4.09 At Closing, AGEL has cash in an amount of
less than approximately $150,000 or has any liabilities,
contingent or otherwise, other than as set forth on the
Exceptions Schedule.
4.10 Shamrock has not exercised all conversion
rights with respect to the preferred stock held by it or has not
taken all actions necessary to cause the transfer agent for AGEL
to issue the
5,823,019 shares of common stock owned by Shamrock either
directly or as a result of the conversion.
4.11 AGEL shall not have complied with the Letter
Agreement (the "Letter Agreement") dated November 23, 1999
between AGEL and Shamrock except as modified by the terms of
this Agreement.
5. Escrow Agreement.
5.01 At the Closing, pursuant to the terms and
subject to the conditions of that certain Escrow Agreement by
and between the Buyers, Shamrock, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Trustee of
the Estate, AGEL and the Escrow Agent, substantially in the form
of Exhibit "C" attached hereto ("Escrow Agreement"), the
Purchase Price plus the amount of cash on hand in AGEL as of
Closing less the liabilities set out on the Exceptions Schedule
shall be deposited with the Escrow Agent (all such amounts
deposited pursuant to the terms and subject to the conditions of
the Escrow Agreement as contemplated by this Agreement shall be
referred to in the aggregate as the "Escrow Amount"). Pursuant
to the terms and subject to the conditions of the Escrow
Agreement, promptly following the expiration of the Termination
Date and after giving effect to the final determination of all
claims of the Buyers, unless the parties instruct the Escrow
Agent otherwise, the Escrow Agent shall distribute to Shamrock
1.8% of the Escrow Amount (it being understood that the other
98.2% of the Escrow Amount shall be distributed to the Estate).
5.02 Any right of setoff under this Agreement
with respect to a claimed breach or the happening of any
occurrence described in Section 4 shall expire on September 30,
2000 (the "Termination Date"), unless on or prior to the
Termination Date a claim has been made by the Buyers. If a
claim is timely made, it may continue to be asserted beyond the
Termination Date.
5.03 The amounts which are payable to the Buyers
as a result of the successful determination of a claim or claims
of the Buyers shall be paid solely out of the Escrow Amount
pursuant to the terms and subject to the conditions of the
Escrow Agreement.
6. Other Remedies. In lieu of the right of setoff
described herein, if there is any breach by Shamrock or the
happening of any occurrence described in Section 4 the Buyers
shall, at their option, be entitled to rescind the transactions
contemplated by this Agreement up to and through the Termination
Date. Shamrock acknowledges and agrees that the right of setoff
described herein alone may not be an adequate remedy for any
breach by Shamrock or the happening of any occurrence described
in Section 4 and accordingly expressly agrees that, in lieu of
the right of setoff described herein, the Buyers shall be
entitled to rescind this transaction.
7. Letter Agreement. The Buyers acknowledge and agree
that under the terms of the Letter Agreement and the Order
Approving Settlement Agreement Among the Debtor, the ▇▇▇▇▇▇▇
Entities, AGEL and the AGEL Subsidiaries Regarding Compromise
and Settlement of Claims (the "Order") approved by the United
States Bankruptcy Court, Northern District of New York dated
December 23, 1999, AGEL has transferred to Shamrock all of its
right, title and interest in all of its rights, title and
interests under the First Amended Joint Plan of Liquidation for
Am Gam Associates and American Gaming and Resorts of
Mississippi, Inc. (the "Mississippi Interests"). Further, under
the Letter Agreement and Order, AGEL is obligated to deliver or
cause to be delivered directly to Shamrock immediately upon
receipt all payments, distributions, dividends and proceeds of a
type to which AGEL is entitled pursuant to or in connection
therewith the Irrevocable Proxy and Consent Agreement dated as
of August 23, 1996 between and between ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇. ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
and AGEL, as amended (the "Rising Sun Interests"). The Buyers
acknowledge and agree that following the Closing AGEL will
continue to be bound by the terms of the Letter Agreement and
Order and will have no interest or claim to the Mississippi
Interests or Rising Sun Interests.
8. Conditions to Closing. The obligations of the parties
under this Agreement are subject to the satisfaction of the
following express conditions precedent at or before the Closing:
8.01 AGEL and RSR, LLC shall have executed and
delivered a settlement agreement, in form and substance
satisfactory to the Estate and Shamrock; the settlement
agreement shall have been approved by the Indiana Gaming
Commission; and the settlement thereunder shall have closed.
8.02 The Indiana Gaming Commission shall have
approved the sale of the Stock by the Estate and Shamrock to the
Buyers.
8.03 The Estate and Shamrock shall cause AGEL to
deliver to the Buyers copies of any books and records of AGEL,
as the Buyers may reasonably request.
8.04 Buyers shall purchase all of AGEL's
shares owned by the Estate pursuant to the terms of a Stock
Purchase Agreement of even date herewith.
8.05 The United States Bankruptcy Court for
the Northern District of New York shall have approved the sale
of the Stock by the Estate pursuant to the terms of the Stock
Purchase Agreement, free and clear of claims, liens and
encumbrances, and the conversion of the Series C, D and E
preferred stock into common stock ("Bankruptcy Court Approval")
and the Order approving the sale and conversion shall have
become final.
8.06 AGEL and J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ shall
have agreed upon the terms of a new consulting/employment
agreement which agreement will be subject to the Closing of
this Agreement and the Stock Purchase Agreement with the
Trustee.
9. Termination and Postponement. This Agreement may be
terminated, and the transactions provided for herein abandoned,
at any time prior to but not after the Closing, as follows:
9.01 by mutual consent of the Buyers and Shamrock;
9.02 by the Buyers or Shamrock, if any of the
conditions set forth in Article VIII shall not have been met or
cannot reasonably be met by the Closing Date; or
9.03 by the Buyers or Shamrock if the Closing has
not been consummated by August 31, 2000.
In the event of the termination and abandonment
of this Agreement and the transactions contemplated hereby, this
Agreement shall become void and of no effect, without any
liability on the part of any party or its directors, officers or
shareholders.
10. Miscellaneous.
10.01 All notices, requests, demands and other
communications which are required or may be given pursuant to
the terms of this Agreement shall be in written or electronic
form and shall be deemed delivered (i) on the date of delivery
when delivered by hand, (ii) on the date of transmission when
sent by facsimile transmission during normal business hours with
telephone confirmation of receipt, (iii) one day after dispatch
when sent by overnight courier maintaining records of receipt,
or (iv) three days after dispatch when sent by certified mail,
postage prepaid, return-receipt requested; provided that, in an
any such case, such communication is addressed as provided in
the immediately following paragraph. All notices, requests,
demands and other communications which are required or may be
given pursuant to the terms of this Agreement shall be addressed
as follows:
(i) If to Shamrock:
Shamrock Holdings Group, Inc.
c/o ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
(ii) If to the Buyers:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq. or
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ and Darko, LLP
Bank One Tower
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Any party may change its address or the designation of the
intended recipient of notice provided that it notifies the other
parties in accordance with the terms of this section.
10.02 This Agreement shall not be assigned by
Shamrock but the Buyers may, without Shamrock's approval, assign
their interests. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their successors and
permitted assigns. Nothing in this Agreement is intended to
confer, expressly or by implication, upon any other person any
rights or remedies under or by reason of this Agreement.
10.03 This Agreement shall be governed by, and
construed and enforced in accordance with, the internal laws of
the State of Indiana (without giving effect to the conflicts of
law provisions thereof).
10.04 This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and
which together shall constitute a single instrument. The parties
agree that they will accept executed documents with facsimile
signatures which will be promptly replaced with original
signatures.
10.05 Shamrock and the Buyers agree that the
timing and content of any press release
or other public announcement with respect to this Agreement and
the transactions contemplated hereby shall be subject to mutual
agreement of the parties hereto to the maximum extent feasible
and consistent with their respective legal obligations to
disseminate material information to their stockholders and the
public.
10.06 This Agreement, Schedules, and the
Consulting Agreement between AGEL and J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
contain the entire understanding and agreement between the
parties hereto with respect to the transactions contemplated
hereby and supersede all prior and contemporaneous agreements or
understandings, express or implied, oral or written, between the
parties with respect to the subject matter hereof.
10.07 At any time prior to the Closing Date, the
parties hereto may, by written agreement (i) extend the time for
the performance of any of the obligations or other acts of the
parties hereto, (ii) waive any inaccuracies in the
representations and warranties contained in this Agreement or in
any schedule or document delivered pursuant hereto and (iii)
waive compliance with any of the covenants or agreements
contained in this Agreement.
10.08 If any covenant or provision hereof is
determined to be void or unenforceable in whole or in part, it
shall not be deemed to affect or impair the invalidity of any
other covenant or provision, each of which is hereby declared to
be separate and distinct. If any provision of this Agreement is
so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable. If any
provision of this Agreement is declared invalid or unenforceable
for any reason other than overbreadth, the offending provision
will be modified so as to maintain the essential benefits of the
bargain among the parties hereto to the maximum extent possible,
consistent with law and public policy.
10.09 If any legal action or any other proceeding
is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default, or misrepresentation in
connection with any of the provisions of this Agreement, the
successful or prevailing party or parties shall be entitled to
recover reasonable attorney's fees and other costs incurred in
that action or proceeding, in addition to any other relief to
which it or they may be entitled.
10.10 The parties submit to the jurisdiction of
the United State Bankruptcy Court for the Northern District of
New York for resolution of any disputes or controversies arising
out of this Agreement.
10.11 The representations and warranties,
covenants and obligations of the parties contained herein shall
survive the Closing Date. There are no promises, undertakings,
representations or warranties by Shamrock relative to the
subject matter hereof not expressly set forth herein.
10.12 Shamrock and Buyers shall each bear their
respective costs and expenses incurred prior to Closing,
including legal, accounting and other expenses, in connection
with the proposed sale.
10.13 ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ is entering into this
Agreement solely in his capacity as President of Shamrock and
shall have no personal responsibility or liability whatsoever
under this Agreement.
10.14 J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ is entering into this
Agreement solely in his capacity as President and CEO of AGEL
and shall have no personal responsibility or liability
whatsoever under this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties have executed this Agreement on
the day and year first above written.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
__________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
__________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
[SIGNATURE PAGE TO SHAMROCK STOCK PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the parties have executed this Agreement on
the day and year first above written.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
___________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
[SIGNATURE PAGE TO SHAMROCK STOCK PURCHASE AGREEMENT]
SHAMROCK HOLDINGS GROUP, INC.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
[SIGNATURE PAGE TO SHAMROCK STOCK PURCHASE AGREEMENT]
AMERICAN GAMING & ENTERTAINMENT, LTD.
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
______________________________________
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
President and CEO
[SIGNATURE PAGE TO SHAMROCK STOCK PURCHASE AGREEMENT]