Exhibit No. 10.2

 

REAL PROPERTY PURCHASE AND SALE AGREEMENT

 

THIS REAL PROPERTY PURCHASE AND SALE AGREEMENT (this “Agreement”) is made and
entered into January 11, 2008, by and between GANASTE LLC, a Nevada limited
liability company (“Purchaser”) and SPEAKEASY GAMING OF LAS VEGAS, INC., a
Nevada corporation (“Seller”).

 

RECITALS

 

A.            Seller is the sole owner of improved real property located at 3227
Civic Center Drive in the City of North Las Vegas, County of Clark, State of
Nevada, consisting of approximately 5.5 acres, identified by Clark County
Assessor’s Parcel Numbers 139-11-803-002, 139-11-815-001 and 139-11-815-003 and
more particularly described in Exhibit “A” attached hereto and incorporated
herein, together with all right, title and interest of Seller in and to any
easements, hereditaments, covenants and other rights appurtenant to such land
and any land lying in the bed of any existing dedicated street, road, avenue or
alley, open or closed, in front of or adjoining such land and all improvements
owned by Seller and located thereon, including all existing parking spaces (the
“Real Property”).

 

B.            Seller operates a hotel, casino, restaurant, bar and related
businesses commonly known as the Ramada Inn Speedway Hotel and Casino on the
Real Property (the “Business”).

 

C.            Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller all of Seller’s right, title and interest in and to the
Real Property.

 

D.            Subject to the terms and conditions set forth herein, as of the
Closing (as defined in Section 9.1), Seller and Purchaser will enter into a
Master Lease in the form attached hereto as Exhibit “B” pursuant to which Seller
will lease the Real Property from Purchaser.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth,
and of other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:

 

1.             DEFINITIONS.

 

1.1           TERMS.  FOR ALL PURPOSES OF THIS AGREEMENT, THE FOLLOWING TERMS
SHALL HAVE THE RESPECTIVE MEANINGS SET FORTH BELOW:

 

“AAI Rules” means the Rules published by the United States Environmental
Protection Agency for All Appropriate Inquiry Standards and the requirements of
ASTME1527-05.

 

“Agreement” has the meaning ascribed to it in the introductory paragraph.

 

 

 

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“Americans With Disabilities Act” means 42 USC § 12101, et seq. and all laws or
regulations from time to time applicable to the Real Property governing use,
access and accommodations.

 

“Asset Purchase Agreement” means that certain Asset Purchase and Sale Agreement
of even date herewith between Seller and Lucky Lucy pertaining to sale by Seller
to Lucky Lucy of the Business, including Gaming Assets.

 

“Business” has the meaning ascribed to it in Recital B.  For purposes of this
Agreement, the term “Business” excludes the Real Property.

 

“Business Day” means any day other than a Saturday, Sunday, or other day on
which commercial banks are authorized or required to close under the laws of the
State of Nevada.

 

“Closing” shall mean the closing of the purchase and sale of the Real Property
in accordance with Section 9.1.

 

“Closing Date” shall mean the date of Closing provided for in Section 9.1.

 

“Deed” has the meaning ascribed to it in Section 7.1(a).

 

“Defect Notice” has the meaning ascribed to it in Section 4.2.

 

“Defects” has the meaning ascribed to it in Section 4.2.

 

“Deposit” has the meaning ascribed to it in Section 2.1.

 

“DOV” has the meaning ascribed to it in Section 7.1(b).

 

“Effective Date” means the date on which both Seller and Purchaser have executed
this Agreement.

 

“Federal Tax Law” means the Federal Foreign Investment in Real Property Tax Act
of 1980 and the 1986 Tax Reform Act, as amended.

 

“FIRPTA” means a non-foreign affidavit which is signed at Closing as it is
stated to be a Closing Document, providing, in part, that Purchaser is not a
foreign person.

 

“Gaming Assets” means any and all gaming devices (as defined in NRS 463.0155),
gaming device parts inventory and all rights, properties and businesses which
directly or indirectly comprise, are used in or relate to gaming, gaming
equipment and supplies used in connection with the operation of a casino,
including, without limitation, slot machines, gaming tables, cards, dice, chips,
tokens, player tracking systems, cashless wagering systems (as defined in NRS
463.014), mobile gaming systems (as defined in NGC Regulation 14.010(11)) and
associated equipment (as defined in NRS 463.0136), credit files, computer
records, financial statements, gaming tax returns, customer lists, all related
accounting files, all computer hardware, software and all other personal
property, tangible or intangible, which are now located at the Business as of
the date of this Agreement, used or usable exclusively in the present or

 

 

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future operation of all or any portion of the Business, ordered for future use
at the Business as of the Closing, credit files.

 

“Gaming Authorities” means the Nevada Gaming Commission, the Nevada Gaming
Control Board and the City of North Las Vegas or any other governmental agency
of the State of Nevada or its political subdivisions that succeeds to the
functions of such agencies.

 

“Governmental Authorities” has the meaning ascribed to it in Section 5.9.

 

“Governmental Regulation” shall mean any laws, ordinances, rules, requirements,
resolutions, policy statements and regulations (including, without limitation,
those relating to land use, subdivision, zoning, environmental, toxic or
hazardous waste, occupational health and safety, water, earthquake hazard
reduction and building and fire codes) of the Governmental Authorities bearing
on the construction, alteration, rehabilitation, maintenance, use, operation or
sale of the Real Property.

 

“Hazardous Substances” means any substance:  (i) the presence of which requires
investigation, remediation or disclosure under any present federal, state or
local statute, regulation, ordinance, order, action, policy or common law;
(ii) the presence of which causes or threatens to cause a nuisance or other harm
upon the Property or to adjacent properties or poses or threatens to pose a
hazard to the health or safety of persons on or about the Real Property; and/or
(iii) including, without limitation, waste, pollutants, oil or other hazardous
substances, including, without limitation, petroleum or petroleum products,
radioactive, flammable or explosive substances, asbestos or asbestos-containing
materials, polychlorinated biphenyls and all materials and wastes which are or
become classified as “hazardous substances”, “hazardous materials” and/or “toxic
substances” under any applicable law, as the same may be amended from time to
time, including, but not limited to the Resource Conservation and Recovery Act,
(RCRA) (42 U.S.C. § 6901, et seq.), the Comprehensive Environmental Response,
Compensation and Liability Act (CERCLA) (42 U.S.C. § 9601, et seq.), the Toxic
Substances Control Act (15 U.S.C. § 2601, et seq.), the Clean Water Act (33 U.
S. C. § 1251, et. seq.), and the Clean Air Act (42 U. S. C. § 7401, et. seq.).

 

“Hotel” has the meaning ascribed to it in Recital A.

 

“Indemnifying Party” has the meaning ascribed to it in Section 17.4.

 

“Indemnitee” has the meaning ascribed to it in Section 17.4.

 

“Leases” means all leases or other agreements permitting the use or occupancy of
space on, under, over or about the Real Property, including all amendments and
exhibits thereto and assignments thereof.

 

“Losses” has the meaning ascribed to in Section 17.1.

 

“Lucky Lucy” shall mean Lucky Lucy D, LLC, a Nevada limited liability company
“Monetary Encumbrance” has the meaning ascribed to in Section 4.4.

 

“Master Lease” has the meaning ascribed to it in Section 7.1(c).

 

 

 

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“Non-Monetary Defect” has the meaning ascribed to it in Section 4.2.

 

“Notice Period” has the meaning ascribed to it in Section 4.2.

 

“NRS” means the Nevada Revised Statutes.

 

“Permitted Exceptions” has the meaning ascribed to it in Section 4.1.

 

“Person” means an individual, partnership, corporation, business trust, joint
stock company, trust, unincorporated association, joint venture, limited
liability company, limited liability partnership, governmental authority or
other entity of whatever nature.

 

“Purchase Price” has the meaning ascribed to it in Section 3.4.

 

“Purchaser” has the meaning ascribed to it in the introductory paragraph.

 

“Purchaser’s Closing Deliveries” has the meaning ascribed to it in Section 7.2.

 

“Ramada” has the meaning ascribed to it in Section 20.

 

“Ramada Agreements” shall mean the License Agreement dated as of September 4,
1998, as amended as of March 22, 1999, and as further amended as of January 27,
2005, by and between Ramada Franchise Systems, Inc., Speakeasy Gaming of Las
Vegas, Inc., and MTR Gaming Group, Inc., and the ancillary agreements executed
in connection therewith, relating to a license to operate a Ramada® System Unit
located at 3227 Civic Center Drive, Las Vegas, NV 89030, designated as Unit
#5692-85312.

 

“Real Property” has the meaning ascribed to it in Recital A.

 

“Recognized Environmental Condition” shall mean the presence or likely presence
of any Hazardous Substance on the Real Property under conditions that indicate
an existing release, a past release or a material threat of release of any
Hazardous Substance into structures on the Real Property or into the ground,
groundwater or surface water of the Real Property.

 

“Seller” has the meaning ascribed to it in the introductory paragraph.

 

“Seller’s Affiliates” has the meaning ascribed to it in Section 5.14(b).

 

“Seller’s Closing Deliveries” has the meaning ascribed to it in Section 7.1.

 

“Survey” has the meaning ascribed to it in Section 4.1.

 

“Taxes” means any and all taxes, charges, fees, levies, tariffs, duties,
liabilities, impositions or other assessments of any kind (together with any and
all interest, penalties, additions to tax and additional amounts imposed with
respect thereto) imposed by any tax authority or other Governmental Authorities,
including income, gross receipts, profits, gaming, excise, real or personal
property, environmental, sales, use, value-added, ad valorem, withholding,
social security, retirement, employment, unemployment, workers’ compensation,
occupation, service, license, net worth, capital stock, payroll, franchise,
gains, stamp, transfer

 

 

 

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taxes and shall include any Liability for the taxes of any other Person under
Treasury Regulation Section 1.1502-6 (or any similar provision of state, local
or foreign law), or as a transferee or successor, by contract, or otherwise.

 

“Title Insurance Company” shall mean Nevada Title Company, 2500 N. Buffalo,
Suite 150, Las Vegas, Nevada 89128 (Attention: Troy Lochhead) or such other
nationally recognized title insurance company that may be designated by
Purchaser.

 

“Title Report” has the meaning ascribed to it in Section 4.1.

 

“Title Policy” has the meaning ascribed to it in Section 8.1(c).

 

1.2           INTERPRETATION.  WHENEVER REQUIRED BY THE CONTEXT OF THIS
AGREEMENT, THE SINGULAR SHALL INCLUDE THE PLURAL AND THE MASCULINE SHALL INCLUDE
THE FEMININE AND VICE VERSA.

 

2.             DEPOSIT.  [INTENTIONALLY DELETED]

 

3.             REAL PROPERTY AND EXCLUDED ASSETS.

 

3.1           REAL PROPERTY.  SUBJECT TO THE TERMS AND CONDITIONS SET FORTH
HEREIN, PURCHASER AGREES TO PURCHASE AND ACCEPT FROM SELLER, AND SELLER AGREES
TO SELL, ASSIGN, TRANSFER, CONVEY AND DELIVER TO PURCHASER AT CLOSING, ALL OF
SELLER’S RIGHT, TITLE AND INTEREST IN AND TO THE REAL PROPERTY FREE AND CLEAR OF
ALL LIENS AND SECURITY INTERESTS.

 

3.2           EXCLUDED ASSETS.  NOTWITHSTANDING ANY OTHER PROVISION HEREOF TO
THE CONTRARY, THE PARTIES ACKNOWLEDGE AND AGREE THAT PURCHASER IS NOT ACQUIRING
THE BUSINESS UNDER THIS AGREEMENT INCLUDING, WITHOUT LIMITATION, ANY GAMING
ASSETS OR OTHER TANGIBLE OR INTANGIBLE PERSONAL PROPERTY.

 

3.3           CONVEYANCE.  SELLER AGREES THAT IT WILL, AT ANY TIME AND FROM
TIME-TO-TIME AFTER THE CLOSING DATE, UPON REQUEST AND AT THE EXPENSE OF
PURCHASER, DO, EXECUTE, ACKNOWLEDGE OR DELIVER, ALL SUCH FURTHER ACTS, DEEDS,
ASSIGNMENTS, CONVEYANCES AND ASSURANCES AS MAY REASONABLY BE REQUIRED FOR
CONVEYING AND TRANSFERRING THE REAL PROPERTY TO PURCHASER.

 

3.4           PURCHASE PRICE AND TERMS OF PAYMENT.  THE PURCHASE PRICE SHALL BE
ELEVEN MILLION FOUR HUNDRED THOUSAND DOLLARS ($11,400,000) (THE “PURCHASE
PRICE”) PAYABLE AT CLOSING IN IMMEDIATELY AVAILABLE FUNDS, ADJUSTED AS PROVIDED
FOR PRORATIONS AND COSTS ASSOCIATED WITH THE CLOSING AS SET FORTH HEREIN.

 

4.             TITLE.  PURCHASER HAS RECEIVED THE SECOND AMENDMENT TO THE TITLE
REPORT FOR ORDER NUMBER 06-10-0152-DTL, DATED DECEMBER 26, 2007 ISSUED BY THE
TITLE INSURANCE COMPANY (THE “TITLE REPORT”) ON OR BEFORE THE EFFECTIVE DATE AS
EVIDENCE OF THE STATUS OF SELLER’S TITLE TO THE REAL PROPERTY.  THE EXCEPTIONS
LISTED ON EXHIBIT “C” ATTACHED HERETO AND MADE A PART HEREOF SHALL BE DEEMED TO
HAVE BEEN APPROVED BY PURCHASER AS OF THE EFFECTIVE DATE AND CONSTITUTE THE
“PERMITTED EXCEPTIONS” AND SHALL INCLUDE ANY RIGHTS, INTERESTS OR CLAIMS SHOWN
ON THE ALTA/ACSM LAND TITLE SURVEY, CERTIFIED ON JANUARY 2, 2007 AND PREPARED BY
HERITAGE SURVEYING (THE “SURVEY”).  NOTWITHSTANDING ANYTHING IN EXHIBIT “C” TO
THE CONTRARY, REAL ESTATE TAXES SHALL BE PRORATED AT CLOSING IN ACCORDANCE WITH
SECTION 10.

 

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5.             REPRESENTATIONS AND WARRANTIES OF SELLER.  SELLER REPRESENTS AND
WARRANTS TO PURCHASER THAT, TO THE BEST OF SELLER’S KNOWLEDGE AND BELIEF, THE
FOLLOWING SHALL BE TRUE AND COMPLETE IN ALL MATERIAL RESPECTS:

 

5.1           DULY ORGANIZED.  SELLER IS DULY ORGANIZED AND VALIDLY EXISTING
UNDER THE LAWS OF ITS STATE OF INCORPORATION AND HAS ALL REQUISITE POWER AND
AUTHORITY TO CARRY ON ITS BUSINESS AS NOW BEING CONDUCTED.  SELLER IS DULY
QUALIFIED OR LICENSED TO DO BUSINESS AND IS IN GOOD STANDING IN EACH
JURISDICTION IN WHICH THE PROPERTY OWNED, LEASED OR OPERATED BY IT OR THE NATURE
OF THE BUSINESS CONDUCTED BY IT MAKES SUCH QUALIFICATION OR LICENSING NECESSARY.

 

5.2           MARKETABLE TITLE.  SELLER HAS A GOOD, VALID AND MARKETABLE FEE
INTEREST IN THE REAL PROPERTY.  SELLER HAS NOT RECEIVED WRITTEN NOTICE OF, NOR
DOES SELLER HAVE ANY KNOWLEDGE OF, ANY PROCEEDINGS PENDING (AND, TO THE
KNOWLEDGE OF SELLER, OVERTLY CONTEMPLATED OR THREATENED) OR OTHERWISE RELATING
TO THE REAL PROPERTY OR THE INTERESTS OF SELLER THEREIN, WHICH WOULD BE
REASONABLY LIKELY TO INTERFERE WITH USE, OWNERSHIP, IMPROVEMENT, DEVELOPMENT
AND/OR OPERATION.  AS OF THE DATE HEREOF, THERE ARE NO CONTRACTS OR LEASES OR
OTHER OBLIGATIONS OUTSTANDING FOR THE SALE, EXCHANGE, MATERIAL ENCUMBRANCE OR
TRANSFER OF THE REAL PROPERTY OTHER THAN THIS AGREEMENT.  TO THE BEST OF
SELLER’S KNOWLEDGE AND BELIEF, THERE ARE NO ENVIRONMENTAL CONDITIONS, INCLUDING,
BUT NOT LIMITED TO, HAZARDOUS WASTE AFFECTING THE REAL PROPERTY OR THREATENED
ENFORCEMENT OR INVESTIGATIVE ACTION BY A GOVERNMENTAL AUTHORITY INVOLVING A
RECOGNIZED ENVIRONMENTAL CONDITION WITH RESPECT TO THE REAL PROPERTY THAT WOULD
PREVENT OR HINDER REDEVELOPMENT OF THE REAL PROPERTY OR REQUIRE REMEDIATION
UNDER ANY GOVERNMENTAL REGULATION.

 

5.3           UNITED STATED PERSON.  SELLER IS A “UNITED STATES PERSON” WITHIN
THE MEANING OF SECTIONS 1445(F)(3) AND 7701(A)(3) OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED.

 

5.4           NO ASSIGNMENT.  NO ATTACHMENT, EXECUTION PROCEEDINGS, ASSIGNMENTS
FOR THE BENEFIT OF CREDITORS, INSOLVENCY, BANKRUPTCY, REORGANIZATION OR OTHER
PROCEEDINGS ARE PENDING OR THREATENED AGAINST SELLER.

 

5.5           AUTHORITY.  SELLER HAS THE LEGAL POWER, RIGHT AND AUTHORITY TO
ENTER INTO THIS AGREEMENT AND THE INSTRUMENTS REFERENCED HEREIN AND TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

5.6           REQUISITE ACTION.  ALL REQUISITE ACTION (CORPORATE, PARTNERSHIP OR
OTHERWISE) HAS BEEN TAKEN BY SELLER IN CONNECTION WITH ENTERING INTO THIS
AGREEMENT, THE INSTRUMENTS REFERENCED HEREIN AND THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY.

 

5.7           ENFORCEABILITY.  THIS AGREEMENT AND ALL DOCUMENTS REQUIRED HEREBY
TO BE EXECUTED BY SELLER ARE AND SHALL BE VALID, LEGAL, BINDING OBLIGATIONS OF,
AND ENFORCEABLE AGAINST, SELLER IN ACCORDANCE WITH THEIR TERMS, SUBJECT ONLY TO
APPLICABLE BANKRUPTCY, INSOLVENCY,

 

 

 

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REORGANIZATION, MORATORIUM OR SIMILAR LAWS, OR EQUITABLE PRINCIPLES AFFECTING OR
LIMITING THE RIGHTS OF CONTRACTING PARTIES GENERALLY.

 

5.8           NO CONFLICT.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY
SELLER DOES NOT, AND THE CONSUMMATION BY SELLER OF THE TRANSACTIONS TO WHICH IT
IS A PARTY THAT ARE CONTEMPLATED BY THIS AGREEMENT WILL NOT, (I) CONFLICT WITH,
OR RESULT IN ANY VIOLATION OR BREACH OF, ANY PROVISION OF THE ARTICLES OF
INCORPORATION, BYLAWS OR OTHER ORGANIZATIONAL DOCUMENTS OF SELLER, (II) RESULT
IN ANY VIOLATION OR BREACH OF, OR CONSTITUTE (WITH OR WITHOUT NOTICE OR LAPSE OF
TIME, OR BOTH) A DEFAULT (OR GIVE RISE TO A RIGHT OF TERMINATION, CANCELLATION
OR ACCELERATION OF ANY OBLIGATION OR LOSS OF ANY MATERIAL BENEFIT) OR REQUIRE AN
APPROVAL UNDER ANY OF THE TERMS, CONDITIONS OR PROVISIONS OF ANY NOTE, BOND,
MORTGAGE, INDENTURE, LEASE, CONTRACT OR OBLIGATION TO WHICH SELLER IS A PARTY OR
BY WHICH SELLER OR ANY OF THE REAL PROPERTY MAY BE BOUND.

 

5.9           NO APPROVAL.  NO APPROVAL OF OR FROM ANY COURT, ARBITRATOR OR
GOVERNMENTAL, ADMINISTRATIVE OR REGULATORY AUTHORITY, AGENCY, COMMISSION, BODY
OR INSTRUMENTALITY, DOMESTIC OR FOREIGN (EACH, A “GOVERNMENTAL AUTHORITIES”), IS
REQUIRED BY OR WITH RESPECT TO SELLER IN CONNECTION WITH THE EXECUTION AND
DELIVERY OF THIS AGREEMENT BY SELLER OR THE CONSUMMATION BY SELLER OF THE
TRANSACTIONS TO WHICH IT IS A PARTY THAT ARE CONTEMPLATED HEREBY.

 

5.10         NO PROCEEDINGS WITH GOVERNMENTAL AUTHORITIES.  THERE IS NO
PROCEEDING AGAINST SELLER PENDING BEFORE ANY GOVERNMENTAL AUTHORITIES, OR AS TO
WHICH SELLER HAS RECEIVED ANY WRITTEN NOTICE OF, ASSERTION OR, TO THE KNOWLEDGE
OF SELLER, ANY PROCEEDING THREATENED, RELATING TO THE REAL PROPERTY.

 

5.11         HAZARDOUS SUBSTANCES.  TO SELLER’S KNOWLEDGE, NO HAZARDOUS
SUBSTANCES HAVE BEEN STORED ON THE REAL PROPERTY, AND SELLER IS NOT SUBJECT TO
ANY PENDING OR, TO SELLER’S KNOWLEDGE, THREATENED ENFORCEMENT OR INVESTIGATORY
ACTION BY ANY GOVERNMENTAL AUTHORITIES REGARDING HAZARDOUS SUBSTANCES WITH
RESPECT TO THE REAL PROPERTY.

 

5.12         NO MATERIAL ENVIRONMENTAL CONDITIONS.  TO SELLER’S KNOWLEDGE, THERE
ARE NO MATERIAL ENVIRONMENTAL CONDITIONS PERTAINING TO THE REAL PROPERTY WHICH
ARE NOT REFLECTED IN (I) THAT CERTAIN PHASE 1 ENVIRONMENTAL SITE ASSESSMENT OF
ATC ASSOCIATES, INC., DATED JANUARY 10, 2007; (II) THAT CERTAIN PHASE I
ENVIRONMENTAL REPORT OF KLEINFELDER, INC., DATED APRIL 22, 1998, AS SUPPLEMENTED
BY THAT CERTAIN LETTER FROM KLEINFELDER, INC., TO ROBERT GACH, DATED AUGUST 13,
1998, (III) THAT CERTAIN PHASE I ENVIRONMENTAL SITE ASSESSMENT OF UNOCAL
PROPERTY 6484 OF PHR ENVIRONMENTAL CONSULTANTS, INC., DATED OCTOBER, 1997,
(IV) THAT CERTAIN PHASE I ENVIRONMENTAL SITE ASSESSMENT OF BROADBENT &
ASSOCIATES, INC., DATED OCTOBER 1991 AND (V) THAT CERTAIN SITE INVESTIGATION
REPORT OF HARDING LAWSON ASSOCIATES, DATED APRIL 25, 1988.

 

5.13         NO BILLBOARD LEASES.  THERE ARE NO BILLBOARD LEASES ENCUMBERING THE
REAL PROPERTY.

 

5.14         “AS IS” SALE.

 

(A)           PURCHASER EXPRESSLY ACKNOWLEDGES AND AGREES TO ACCEPT THE REAL
PROPERTY ON AN “AS-IS-WHERE-IS AND WITH ALL FAULTS” BASIS, EXCEPT AS OTHERWISE
PROVIDED IN THIS AGREEMENT.

 

 

 

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(B)           THIS AGREEMENT, AS WRITTEN, CONTAINS ALL THE TERMS OF THE
AGREEMENT ENTERED INTO BETWEEN THE PARTIES AS OF THE DATE HEREOF, AND PURCHASER
ACKNOWLEDGES THAT NEITHER SELLER NOR ANY PERSON CONTROLLING, CONTROLLED BY OR
UNDER COMMON CONTROL WITH SELLER (COLLECTIVELY, “SELLER’S AFFILIATES”), NOR ANY
OF THEIR AGENTS OR REPRESENTATIVES, HAS MADE ANY REPRESENTATIONS OR WARRANTIES
OR HELD OUT ANY INDUCEMENTS TO PURCHASER, AND SELLER HEREBY SPECIFICALLY
DISCLAIMS ANY REPRESENTATION OR WARRANTY, ORAL OR WRITTEN, PAST, PRESENT OR
FUTURE, OTHER THAN THOSE SPECIFICALLY SET FORTH IN THIS AGREEMENT.  WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, NEITHER SELLER NOR ANY OF SELLER’S
AFFILIATES, NOR ANY OF SELLER’S AGENT OR REPRESENTATIVES, HAS OR IS WILLING TO
MAKE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, OTHER THAN AS MAY BE
EXPRESSLY SET FORTH HEREIN, AS TO:  (I) THE CURRENT OR FUTURE REAL ESTATE TAX
LIABILITY, ASSESSMENT OR VALUATION OF THE REAL PROPERTY; (II) THE POTENTIAL
QUALIFICATION OF THE REAL PROPERTY FOR ANY AND ALL BENEFITS CONFERRED BY ANY
LAWS WHETHER FOR SUBSIDIES, SPECIAL REAL ESTATE TAX TREATMENT, INSURANCE,
MORTGAGES (EXCEPT TO THE EXTENT GRANTED TO AN AFFILIATE OF SELLER) OR ANY OTHER
BENEFITS, WHETHER SIMILAR OR DISSIMILAR TO THOSE ENUMERATED; (III) THE CURRENT
OR FUTURE USE OF THE REAL PROPERTY; OR (IV) THE STATUS OF THE MARKET IN WHICH
THE REAL PROPERTY IS LOCATED.

 

(C)           PURCHASER ACKNOWLEDGES THAT SELLER HAS AFFORDED PURCHASER THE
OPPORTUNITY FOR FULL AND COMPLETE INVESTIGATIONS, EXAMINATIONS AND INSPECTIONS
OF THE REAL PROPERTY AND ALL PERTINENT INFORMATION.  PURCHASER ACKNOWLEDGES AND
AGREES THAT THE INFORMATION DELIVERED OR MADE AVAILABLE TO PURCHASER AND
PURCHASER’S REPRESENTATIVES BY SELLER OR SELLER’S AFFILIATES, OR ANY OF THEIR
AGENTS OR REPRESENTATIVES, MAY HAVE BEEN PREPARED BY THIRD PARTIES AND MAY NOT
BE THE WORK PRODUCT OF SELLER AND/OR ANY OF SELLER’S AFFILIATES.

 

(D)           PURCHASER OR ANYONE CLAIMING BY, THROUGH OR UNDER PURCHASER,
HEREBY FULLY AND IRREVOCABLY RELEASES SELLER AND SELLER’S AFFILIATES AND THEIR
AGENTS AND REPRESENTATIVES, FROM ANY AND ALL CLAIMS THAT IT MAY NOW HAVE OR
HEREAFTER ACQUIRE AGAINST SELLER OR SELLER’S AFFILIATES OR THEIR AGENTS OR
REPRESENTATIVES OF ANY COST, LOSS, LIABILITY, DAMAGE, EXPENSE, ACTION OR CAUSE
OF ACTION, WHETHER FORESEEN OR UNFORESEEN, ARISING FROM OR RELATED TO ANY
CONSTRUCTION DEFECTS, ERRORS OR OMISSIONS ON OR IN THE REAL PROPERTY, EXCEPT TO
THE EXTENT CREATED BY SELLER OR SELLER’S AFFILIATES AND EXCEPT FOR CLAIMS
AGAINST SELLER BASED UPON ANY OBLIGATIONS AND LIABILITIES OF SELLER EXPRESSLY
PROVIDED IN THIS AGREEMENT.

 

5.15         CLOSING DELIVERIES.   ON OR BEFORE THE EFFECTIVE DATE, SELLER SHALL
HAVE DELIVERED TO THE TITLE INSURANCE COMPANY THE SELLER’S CLOSING DELIVERIES
SET FORTH IN SECTION 7.1.

 

6.             REPRESENTATIONS AND WARRANTIES OF PURCHASER.  PURCHASER HEREBY
REPRESENTS AND WARRANTS TO SELLER AS FOLLOWS:

 

(A)           NO ASSIGNMENT.  NO ATTACHMENT, EXECUTION PROCEEDINGS, ASSIGNMENTS
FOR THE BENEFIT OF CREDITORS, INSOLVENCY, BANKRUPTCY, REORGANIZATION OR OTHER
SUCH PROCEEDINGS ARE PENDING OR, TO THE BEST OF ITS KNOWLEDGE, THREATENED
AGAINST PURCHASER OR ITS PRINCIPALS.

 

(B)           AUTHORITY.  PURCHASER HAS THE LEGAL POWER, RIGHT AND AUTHORITY TO
ENTER INTO THIS AGREEMENT AND THE INSTRUMENTS REFERENCED HEREIN AND TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

 

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(C)           REQUISITE ACTION.  ALL REQUISITE ACTION (CORPORATE, PARTNERSHIP OR
OTHERWISE) HAS BEEN TAKEN BY PURCHASER IN CONNECTION WITH ENTERING INTO THIS
AGREEMENT, THE INSTRUMENTS REFERENCED HEREIN AND THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY, AND NO CONSENT OF OFFICER, DIRECTOR OR
SHAREHOLDER IS REQUIRED,

 

(D)           ENFORCEABILITY.  THIS AGREEMENT AND ALL DOCUMENTS REQUIRED HEREBY
TO BE EXECUTED BY PURCHASER ARE AND SHALL BE VALID, LEGAL AND BINDING
OBLIGATIONS OF, AND ENFORCEABLE AGAINST, PURCHASER IN ACCORDANCE WITH THEIR
TERMS, SUBJECT ONLY TO APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION,
MORATORIUM OR SIMILAR LAWS, OR EQUITABLE PRINCIPLES AFFECTING OR LIMITING THE
RIGHTS OF CONTRACTING PARTIES GENERALLY.

 

(E)           NO CONFLICT.  NEITHER THE EXECUTION AND DELIVERY OF THIS AGREEMENT
AND THE DOCUMENTS REFERENCED HEREIN NOR THE CONSUMMATION OF THE TRANSACTIONS
CONTEMPLATED HEREIN NOR COMPLIANCE WITH THE TERMS OF THIS AGREEMENT AND THE
DOCUMENTS REFERENCED HEREIN CONFLICT OR RESULT IN THE MATERIAL BREACH OF ANY
TERMS, CONDITIONS OR PROVISIONS OF, OR CONSTITUTE A DEFAULT UNDER, ANY BOND,
NOTE OR OTHER EVIDENCE OF INDEBTEDNESS OR ANY CONTRACT, INDENTURE, MORTGAGE,
DEED OF TRUST, LOAN, LEASE OR OTHER AGREEMENTS OR INSTRUMENTS TO WHICH PURCHASER
IS A PARTY OR BY WHICH PURCHASER MAY BE BOUND.

 

(F)            CLOSING DELIVERIES.  ON OR BEFORE THE EFFECTIVE DATE, PURCHASER
SHALL HAVE DELIVERED TO THE TITLE COMPANY THE PURCHASER’S CLOSING DELIVERIES SET
FORTH IN SECTION 7.2.

 

7.             CLOSING DELIVERIES.

 

7.1           SELLER’S CLOSING DELIVERIES.  ON OR BEFORE THE EFFECTIVE DATE,
SELLER SHALL HAVE EXECUTED, ACKNOWLEDGED AND DELIVERED (AS APPROPRIATE) TO THE
TITLE INSURANCE COMPANY THE FOLLOWING (“SELLER’S CLOSING DELIVERIES”):

 

(A)           A GRANT, BARGAIN AND SALE DEED IN PROPER FORM FOR RECORDING,
CONVEYING THE REAL PROPERTY TO PURCHASER IN A FORM MUTUALLY AGREED UPON BY THE
PARTIES (THE “DEED”);

 

(B)           AN EXECUTED COUNTERPART OF THE STATE OF NEVADA DECLARATION OF
VALUE FORM (“DOV”) SETTING FORTH THE ALLOCATION OF THE PURCHASE PRICE;

 

(C)           AN EXECUTED COUNTERPART OF THE MASTER LEASE;

 

(D)           A FIRPTA;

 

(E)           AN OWNER’S AFFIDAVIT, IN THE CUSTOMARY FORM, WITH RESPECT TO THE
ABSENCE OF CLAIMS WHICH WOULD GIVE RISE TO MECHANICS’ LIENS AND THE ABSENCE OF
PARTIES IN POSSESSION OF THE REAL PROPERTY OTHER THAN SELLER PURSUANT TO THE
TERMS OF LEASES, OR SUCH OTHER ASSURANCES AS SHALL BE REASONABLY REQUIRED TO
ENABLE PURCHASER TO OBTAIN THE TITLE POLICY; AND

 

(F)            ALL SUCH OTHER INSTRUMENTS OR DOCUMENTS AS MAY BE REASONABLY
REQUIRED BY PURCHASER OR THE TITLE INSURANCE COMPANY IN ORDER TO CONSUMMATE THE
TRANSACTIONS CONTEMPLATED HEREBY.

 

 

 

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7.2           PURCHASER’S CLOSING DELIVERIES.  ON OR BEFORE THE EFFECTIVE DATE,
PURCHASER SHALL HAVE EXECUTED, ACKNOWLEDGED AND DELIVERED (AS APPROPRIATE) TO
THE TITLE INSURANCE COMPANY THE FOLLOWING (“PURCHASER’S CLOSING DELIVERIES”):

 

(A)           THE PURCHASE PRICE;

 

(B)           AN EXECUTED COUNTERPART OF THE MASTER LEASE;

 

(C)           AN EXECUTED COUNTERPART OF THE DOV; AND

 

(D)           ALL SUCH OTHER INSTRUMENTS OR DOCUMENTS AS MAY BE REASONABLY
REQUIRED BY PURCHASER OR THE TITLE INSURANCE COMPANY IN ORDER TO CONSUMMATE THE
TRANSACTIONS CONTEMPLATED HEREBY.

 

7.3           POST CLOSING DELIVERIES.  THE TITLE INSURANCE COMPANY SHALL
DELIVER TO PURCHASER A CONFORMED COPY OF THE DEED AND DOV, THE ORIGINAL FIRPTA
AND EACH OF THE OTHER DOCUMENTS AND INSTRUMENTS DELIVERED TO THE TITLE INSURANCE
COMPANY BY SELLER PROMPTLY FOLLOWING THE CLOSING.

 

8.             CONDITIONS PRECEDENT.

 

8.1           CONDITIONS PRECEDENT TO PURCHASER’S OBLIGATIONS.  THE OBLIGATION
OF PURCHASER TO PURCHASE THE REAL PROPERTY SHALL BE SUBJECT TO THE FOLLOWING
CONDITIONS (ALL OR ANY OF WHICH MAY BE WAIVED, IN WHOLE OR IN PART, BY
PURCHASER):

 

(A)           THE REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN SECTION 5
SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS AS OF THE CLOSING;

 

(B)           SELLER SHALL HAVE PERFORMED ALL COVENANTS AND OBLIGATIONS REQUIRED
BY THIS AGREEMENT TO BE PERFORMED OR COMPLIED WITH BY SELLER ON OR BEFORE THE
CLOSING DATE;

 

(C)           ON THE CLOSING DATE, (I) SELLER’S TITLE TO THE REAL PROPERTY SHALL
BE MARKETABLE AND FREE-AND-CLEAR OF ALL LIENS, MORTGAGES, DEEDS OF TRUST,
ENCUMBRANCES, EASEMENTS, LEASES, CONDITIONS AND OTHER MATTERS AFFECTING TITLE
OTHER THAN (A) THE PERMITTED EXCEPTIONS, (B) THE MASTER LEASE TO BE ENTERED INTO
AS OF THE CLOSING AND (C) AS PERMITTED UNDER SECTION 4, AND (II) THE TITLE
INSURANCE COMPANY SHALL HAVE COMMITTED UNCONDITIONALLY TO ISSUE TO PURCHASER, OR
ITS DESIGNEE, AT STANDARD RATES, AN ALTA OWNER’S TITLE INSURANCE POLICY COVERING
THE REAL PROPERTY, INCLUDING SUCH ENDORSEMENTS AS PURCHASER MAY REASONABLY
REQUIRE, IN AN AMOUNT EQUAL TO THE PURCHASE PRICE, INSURING PURCHASER’S TITLE TO
THE REAL PROPERTY EXCEPT FOR THE PERMITTED EXCEPTIONS (“TITLE POLICY”); AND

 

(D)           SELLER SHALL HAVE DELIVERED TO THE TITLE INSURANCE COMPANY ALL OF
SELLER’S CLOSING DELIVERIES.

 

8.2           CONDITIONS TO SELLER’S OBLIGATIONS.  THE OBLIGATION OF SELLER TO
SELL THE REAL PROPERTY SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS (ALL OR ANY
OF WHICH MAY BE WAIVED, IN WHOLE OR IN PART, BY SELLER):

 

 

 

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(A)           PURCHASER SHALL HAVE PERFORMED ALL COVENANTS AND OBLIGATIONS
REQUIRED BY THIS AGREEMENT TO BE PERFORMED OR COMPLIED WITH BY PURCHASER ON OR
BEFORE THE CLOSING DATE; AND

 

(B)           PURCHASER SHALL HAVE DELIVERED TO THE TITLE INSURANCE COMPANY ALL
OF PURCHASER’S CLOSING DELIVERIES.

 

9.             CLOSING.

 

9.1           CLOSING DATE.  CLOSING OF THE TRANSACTIONS CONTEMPLATED HEREIN
(THE “CLOSING”) SHALL TAKE PLACE ON THE EFFECTIVE DATE (THE “CLOSING DATE”).
CLOSING SHALL TAKE PLACE AT THE OFFICE OF THE TITLE INSURANCE COMPANY OR AT SUCH
OTHER LOCATION AS PURCHASER AND SELLER SHALL DESIGNATE JOINTLY.  THE DELIVERY TO
THE TITLE INSURANCE COMPANY OF SELLER’S CLOSING DELIVERIES AND PURCHASER’S
CLOSING DELIVERIES SHALL BE DEEMED TO BE A GOOD AND SUFFICIENT TENDER OF
PERFORMANCE OF THE TERMS HEREOF.  UPON RECEIPT OF ALL CLOSING DOCUMENTS AND THE
PURCHASE PRICE, THE TITLE INSURANCE COMPANY SHALL BE AUTHORIZED TO PROCEED TO
RECORD THE DOCUMENTS EVIDENCING THIS TRANSACTION.

 

9.2           CLOSING COSTS.  THE CLOSING COSTS SHALL BE PAID AS FOLLOWS:

 

(A)           SELLER SHALL PAY:

 

(I)            ONE-HALF (1/2) OF THE ESCROW FEES;

 

(II)           REAL PROPERTY TRANSFER TAXES;

 

(III)          THE COST OF THE PREMIUM FOR THE CLTA PORTION OF THE TITLE POLICY;
AND

 

(IV)          THE COST OF ANY OTHER OBLIGATIONS OF SELLER HEREUNDER.

 

(B)           PURCHASER SHALL PAY:

 

(I)            ONE-HALF (1/2) OF THE ESCROW FEES;

 

(II)           COST OF RECORDING THE DEED;

 

(III)          ANY ADDITIONAL PREMIUM CHARGED FOR THE TITLE POLICY IN EXCESS OF
SECTION 9.2(A)(III) ABOVE;

 

(IV)          ANY SURVEY COSTS; AND

 

(V)           THE COST OF ANY OTHER OBLIGATIONS OF PURCHASER HEREUNDER.

 

9.3           OTHER COSTS.  ALL OTHER COSTS AND EXPENSES ATTENDANT TO
SETTLEMENT, INCLUDING TITLE INSURANCE COMPANY CHARGES, SHALL BE SHARED EQUALLY
BY THE PARTIES.  NOTWITHSTANDING THE FOREGOING, EACH PARTY SHALL PAY ITS OWN
ATTORNEYS FEES.  IF CLEAR TITLE CANNOT BE TENDERED BY SELLER AT CLOSING THEN
SELLER SHALL PAY ALL TITLE INSURANCE COMPANY CHARGES.

 

 

 

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10.           PRORATIONS.  ALL NON-DELINQUENT REAL ESTATE TAXES AND OTHER
ASSESSMENTS ON THE PROPERTY WILL BE PRORATED AS OF THE CLOSE OF ESCROW BASED ON
THE ACTUAL CURRENT TAX BILL.  IF THE CLOSE OF ESCROW TAKES PLACE BEFORE THE REAL
ESTATE TAXES ARE FIXED FOR THE TAX YEAR IN WHICH THE CLOSE OF ESCROW OCCURS, THE
APPORTIONMENT OF REAL ESTATE TAXES WILL BE MADE ON THE BASIS OF THE REAL ESTATE
TAXES FOR THE IMMEDIATELY PRECEDING TAX YEAR APPLIED TO THE LATEST ASSESSED
VALUATION.  ALL DELINQUENT TAXES AND ALL DELINQUENT ASSESSMENTS, IF ANY, ON THE
PROPERTY WILL BE PAID AT THE CLOSE OF ESCROW FROM FUNDS ACCRUING TO SELLER. 
SELLER WILL PROMPTLY PAY ALL SUPPLEMENTAL TAXES BILLED AFTER THE CLOSE OF ESCROW
FOR PERIODS PRIOR TO THE CLOSE OF ESCROW.  ALL PRORATIONS WILL BE MADE AS OF THE
DATE OF CLOSE OF ESCROW BASED ON A 365-DAY YEAR OR A 30-DAY MONTH, AS
APPLICABLE.

 

11.           TERMINATION AND REMEDIES.  [INTENTIONALLY DELETED]

 

12.           BROKERS & INVESTMENT BANKERS.

 

12.1         SELLER’S REPRESENTATION AND INDEMNIFICATION.  SELLER REPRESENTS AND
WARRANTS TO PURCHASER THAT IT HAS NOT BEEN REPRESENTED BY ANY BROKER OR
INVESTMENT BANKER IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OTHER THAN LAZARD FRERES & CO., LLC. SELLER WILL
INDEMNIFY AND HOLD PURCHASER HARMLESS FROM ANY CLAIM BY ANY BROKER, AGENT OR
FINDER PURPORTING TO HAVE ACTED ON BEHALF OF SELLER.

 

12.2         PURCHASER’S REPRESENTATION AND INDEMNIFICATION.  PURCHASER
REPRESENTS AND WARRANTS TO SELLER THAT IT HAS NOT BEEN REPRESENTED BY ANY BROKER
IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.  PURCHASER WILL INDEMNIFY AND HOLD SELLER HARMLESS FROM ANY CLAIM BY
ANY BROKER, AGENT OR FINDER PURPORTING TO HAVE ACTED ON BEHALF OF PURCHASER.

 

13.           FOREIGN PERSON.  SELLER IS NOT A “FOREIGN PERSON” FOR PURPOSES OF
FIRPTA.  AT THE CLOSING, SELLER WILL DELIVER TO PURCHASER A CERTIFICATE SO
STATING, IN A FORM COMPLYING WITH THE FEDERAL TAX LAW.  IF SELLER IS A “FOREIGN
PERSON” OR IF SELLER FAILS TO DELIVER THE REQUIRED CERTIFICATE AT THE CLOSING,
THEN IN EITHER SUCH EVENT THE PURCHASE PRICE WILL BE ADJUSTED TO THE EXTENT
REQUIRED TO COMPLY WITH THE WITHHOLDING PROVISIONS OF THE FEDERAL TAX LAW; AND
ALTHOUGH THE AMOUNT WITHHELD WILL STILL BE PAID AT THE CLOSING BY PURCHASER, IT
WILL BE RETAINED BY THE TITLE INSURANCE COMPANY FOR DELIVERY TO THE INTERNAL
REVENUE SERVICE, TOGETHER WITH THE APPROPRIATE FEDERAL TAX LAW FORWARDING FORMS
(AND WITH COPIES BEING PROVIDED BOTH TO SELLER AND TO PURCHASER).

 

14.           ENTIRE AGREEMENT.  NO CHANGE OR MODIFICATION OF THIS AGREEMENT
SHALL BE VALID UNLESS IN WRITING AND SIGNED BY THE PARTIES HERETO.  NO WAIVER OF
ANY OF THE PROVISIONS OF THIS AGREEMENT SHALL BE VALID UNLESS IN WRITING AND
SIGNED BY THE PARTY AGAINST WHOM IT IS SOUGHT TO BE ENFORCED.  THIS AGREEMENT
CONTAINS THE ENTIRE AGREEMENT BETWEEN THE PARTIES RELATING TO THE PURCHASE AND
SALE OF THE REAL PROPERTY, ALL PRIOR NEGOTIATIONS BETWEEN THE PARTIES ARE MERGED
IN THIS AGREEMENT AND THERE ARE NO PROMISES, AGREEMENTS, CONDITIONS,
UNDERTAKINGS, WARRANTIES OR REPRESENTATIONS, ORAL OR WRITTEN, EXPRESS OR
IMPLIED, BETWEEN THEM OTHER THAN AS SET FORTH IN THIS AGREEMENT.

 

 

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15.           GOVERNING LAW; PREVAILING PARTY ATTORNEY FEES.  THIS AGREEMENT
CONCERNS PROPERTY LOCATED IN THE STATE OF NEVADA, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA.  NOTWITHSTANDING
ANY PROVISION IN THIS AGREEMENT TO THE CONTRARY, IN THE EVENT OF A DISPUTE WITH
RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, THE PREVAILING PARTY IN ANY
PROCEEDING, INCLUDING ARBITRATION COMMENCED TO RESOLVE SUCH DISPUTES, SHALL BE
ENTITLED TO AN AWARD OF ITS REASONABLE ATTORNEY FEES AND COURT OR ARBITRATION
COSTS INCURRED IN RESOLVING OR SETTLING THE DISPUTE, IN ADDITION TO ANY AND ALL
OTHER DAMAGES OR RELIEF WHICH THE COURT OR ARBITRATOR MAY DEEM PROPER.

 

16.           NOTICES.  ALL NOTICES, REQUESTS, DEMANDS AND OTHER COMMUNICATIONS
HEREUNDER SHALL BE IN WRITING AND SHALL BE DEEMED TO HAVE BEEN DULY GIVEN IF
DELIVERED PERSONALLY OR VIA FACSIMILE IF A COPY IS ALSO DEPOSITED IN THE UNITED
STATES MAIL, PROPERLY ADDRESSED AND POSTAGE PREPAID, OR DELIVERED BY FEDERAL
EXPRESS OR OTHER RECOGNIZED OVERNIGHT DELIVERY SERVICE, (I) IF TO PURCHASER,
GANASTE LLC, ATTENTION: KEITH REDMOND, C/O INTEGRATED PROPERTIES, INC., 3900 E.
MEXICO AVENUE, SUITE 1400, DENVER, CO, WITH A COPY TO JEFFREY A. SILVER,
ESQUIRE, 3960 HOWARD HUGHES PARKWAY, 9TH FLOOR, LAS VEGAS, NV 89169; (II) IF TO
SELLER, MTR GAMING GROUP, INC., ROUTE 2 SOUTH, P.O. BOX 356, CHESTER, WEST
VIRGINIA 26034, ATTENTION: EDSON R. ARNEAULT, WITH A COPY TO ROBERT L. RUBEN,
ESQUIRE, RUBEN & ARONSON, LLP., 4800 MONTGOMERY LANE SUITE 150, BETHESDA, MD
20814; OR (III) AT SUCH OTHER ADDRESS AS MAY BE GIVEN BY EITHER PARTY TO THE
OTHER PARTY BY NOTICE IN WRITING PURSUANT TO PROVISIONS OF THIS SECTION 16.

 

17.           INDEMNIFICATION.

 

17.1         INDEMNIFICATION BY PURCHASER.  SUBJECT TO THE LIMITS SET FORTH IN
THIS SECTION 17, PURCHASER AGREES TO INDEMNIFY, DEFEND AND HOLD SELLER AND ITS
OFFICERS, DIRECTORS AND AGENTS, HARMLESS FROM AND IN RESPECT OF ANY AND ALL
LOSSES, DAMAGES, LIABILITY, COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
REASONABLE EXPENSES OF INVESTIGATION AND DEFENSE FEES AND DISBURSEMENTS OF
COUNSEL AND OTHER PROFESSIONALS) (COLLECTIVELY, “LOSSES”), ARISING DIRECTLY OR
INDIRECTLY OUT OF OR DIRECTLY OR INDIRECTLY DUE TO ANY INACCURACY OF ANY
REPRESENTATION OR THE BREACH OF ANY WARRANTY, COVENANT OR OTHER AGREEMENT OF
PURCHASER CONTAINED IN THIS AGREEMENT.

 

17.2         INDEMNIFICATION BY SELLER.  SUBJECT TO THE LIMITS SET FORTH IN THIS
SECTION 17, SELLER AGREES TO INDEMNIFY, DEFEND AND HOLD PURCHASER HARMLESS FROM
AND IN RESPECT OF ANY AND ALL LOSSES, INCLUDING REASONABLE ATTORNEY’S FEES,
ARISING DIRECTLY OR INDIRECTLY OUT OF OR DIRECTLY OR INDIRECTLY DUE TO (I) ANY
INACCURACY OF ANY REPRESENTATION OR THE BREACH OF ANY WARRANTY, COVENANT,
UNDERTAKING OR OTHER AGREEMENT OF SELLER CONTAINED IN THIS AGREEMENT, OR
(II) ANY PROPERTY DAMAGE OR PERSONAL INJURIES OCCURRING AT THE REAL PROPERTY
PRIOR TO THE CLOSING.  SELLER SHALL ALSO INDEMNIFY PURCHASER, AND HOLD PURCHASER
HARMLESS AGAINST, ALL LOSSES ATTRIBUTABLE TO VIOLATIONS BY SELLER OF APPLICABLE
ENVIRONMENTAL LAWS AND REGULATIONS DURING THE PERIOD OF SELLER’S OWNERSHIP OF
ITS REAL PROPERTY.

 

17.3         SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS: LIMITATIONS
ON INDEMNITY.  THE REPRESENTATIONS AND WARRANTIES OF THE PARTIES CONTAINED IN
THIS AGREEMENT, OR IN ANY INSTRUMENT DELIVERED PURSUANT TO THIS AGREEMENT, WILL
SURVIVE THE CLOSING DATE AND WILL REMAIN IN FULL FORCE AND EFFECT THEREAFTER FOR
A PERIOD OF TWELVE (12) MONTHS; PROVIDED, HOWEVER, THAT SUCH REPRESENTATIONS OR
WARRANTIES SHALL SURVIVE (IF AT ALL) BEYOND SUCH PERIOD WITH RESPECT TO ANY
INACCURACY THEREIN OR BREACH THEREOF, NOTICE OF WHICH SHALL HAVE BEEN DULY GIVEN
WITHIN SUCH

 

 

 

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TIME PERIOD IN ACCORDANCE WITH THIS SECTION 17.3. NOTWITHSTANDING ANYTHING TO
THE CONTRARY CONTAINED HEREIN, PURCHASER SHALL NOT BE ENTITLED TO RECOVER LOSSES
FROM SELLER NOR SHALL SELLER BE ENTITLED TO RECOVER LOSSES FROM PURCHASER UNLESS
AND UNTIL THE TOTAL OF ALL CLAIMS FOR LOSSES WITH RESPECT TO ANY INACCURACY OR
BREACH OF ANY SUCH REPRESENTATIONS OR WARRANTIES OR BREACH OF ANY COVENANTS,
UNDERTAKINGS OR OTHER AGREEMENTS, WHETHER SUCH CLAIMS ARE BROUGHT UNDER THIS
SECTION 18(C) OR OTHERWISE, EXCEEDS ONE HUNDRED FIFTY THOUSAND DOLLARS
($150,000) IN THE AGGREGATE.  IF THE TOTAL AMOUNT OF SUCH LOSSES EXCEEDS ONE
HUNDRED FIFTY THOUSAND DOLLARS ($150,000), THEN THE PARTY ENTITLED TO RECOVER
HEREUNDER SHALL BE ENTITLED TO RECOVER THE FULL AMOUNT OF SUCH LOSSES AND NOT
MERELY THE PORTION OF SUCH DAMAGES EXCEEDING ONE HUNDRED FIFTY THOUSAND DOLLARS
($150,000); PROVIDED, HOWEVER, THAT THE AGGREGATE AMOUNT OF LOSSES THAT MAY BE
RECOVERED BY PURCHASER FROM SELLER SHALL NOT EXCEED FIVE PERCENT (5%) OF THE
PURCHASE PRICE.  FOR PURPOSES OF APPLYING THE LIMITATIONS SET FORTH IN THIS
SECTION 18.3, THE LOSSES OF THE PURCHASER UNDER THIS AGREEMENT AND THE LOSSES OF
LUCKY LUCY UNDER THE ASSET PURCHASE AGREEMENT SHALL BE AGGREGATED.  SIMILARLY,
THE PURCHASE PRICE UNDER THIS AGREEMENT AND UNDER THE ASSET PURCHASE AGREEMENT
SHALL BE AGGREGATED.

 

17.4         NOTICE AND OPPORTUNITY TO DEFEND.  IF AN EVENT OCCURS WHICH A PARTY
ASSERTS IS AN INDEMNIFIABLE EVENT PURSUANT TO SECTION 17.1 OR 17.2, THE PARTY
SEEKING INDEMNIFICATION (THE “INDEMNITEE”) SHALL PROMPTLY NOTIFY THE OTHER PARTY
OBLIGATED TO PROVIDE INDEMNIFICATION (THE “INDEMNIFYING PARTY”).  IF SUCH EVENT
INVOLVES (A) ANY CLAIM OR (B) THE COMMENCEMENT OF ANY ACTION OR PROCEEDING BY A
THIRD PERSON, THE INDEMNITEE WILL GIVE SUCH INDEMNIFYING PARTY PROMPT WRITTEN
NOTICE OF SUCH CLAIM OR THE COMMENCEMENT OF SUCH ACTION OR PROCEEDING; PROVIDED,
HOWEVER, THAT THE INDEMNITEE’S FAILURE TO PROVIDE PROMPT NOTICE AS PROVIDED
HEREIN WILL RELIEVE THE INDEMNIFYING PARTY OF ITS OBLIGATIONS HEREUNDER ONLY TO
THE EXTENT THAT SUCH FAILURE PREJUDICES THE INDEMNIFYING PARTY HEREUNDER.  IF
ANY SUCH ACTION IS BROUGHT AGAINST ANY INDEMNITEE AND IT NOTIFIES THE
INDEMNIFYING PARTY OF THE COMMENCEMENT THEREOF, THE INDEMNIFYING PARTY SHALL BE
ENTITLED TO PARTICIPATE THEREIN AND, TO THE EXTENT THAT IT WISHES, TO ASSUME THE
DEFENSE THEREOF, WITH COUNSEL REASONABLY SATISFACTORY TO THE INDEMNITEE. 
NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, AFTER NOTICE FROM
THE INDEMNIFYING PARTY TO THE INDEMNITEE OF SUCH ELECTION TO SO ASSUME THE
DEFENSE THEREOF, THE INDEMNIFYING PARTY SHALL NOT BE LIABLE TO THE INDEMNITEE
FOR ANY LEGAL EXPENSES OF OTHER COUNSEL OR ANY OTHER EXPENSES SUBSEQUENTLY
INCURRED BY THE INDEMNITEE IN CONNECTION WITH THE DEFENSE THEREOF, AND THE
INDEMNITEE AGREES TO COOPERATE FULLY WITH THE INDEMNIFYING PARTY AND ITS COUNSEL
IN THE DEFENSE AGAINST ANY SUCH ASSERTED LIABILITY.  THE INDEMNITEE SHALL HAVE
THE RIGHT TO PARTICIPATE AT ITS OWN EXPENSE IN THE DEFENSE OF SUCH ASSERTED
LIABILITY.  IN NO EVENT SHALL AN INDEMNIFYING PARTY BE LIABLE FOR ANY SETTLEMENT
EFFECTED BY THE INDEMNITEE WITHOUT THE CONSENT OF THE INDEMNIFYING PARTY, WHICH
WILL NOT BE UNREASONABLY WITHHELD.  IN NO EVENT SHALL AN INDEMNIFYING PARTY
EFFECT ANY SETTLEMENT WITHOUT THE CONSENT OF THE INDEMNITEE, WHICH WILL NOT BE
UNREASONABLY WITHHELD.

 

17.5         MITIGATION OF LOSS.  EACH INDEMNITEE IS OBLIGATED TO USE REASONABLE
EFFORTS TO MITIGATE TO THE FULLEST EXTENT PRACTICABLE THE AMOUNT OF ANY LOSSES
FOR WHICH IT IS ENTITLED TO SEEK INDEMNIFICATION HEREUNDER.

 

17.6         SUBROGATION.  UPON MAKING ANY PAYMENT OF LOSSES OF THE INDEMNITEE,
THE INDEMNIFYING PARTY WILL, TO THE EXTENT OF SUCH PAYMENT, BE SUBROGATED TO ALL
RIGHTS OF THE INDEMNITEE AGAINST ANY THIRD PARTY IN RESPECT OF THE LOSSES TO
WHICH THE PAYMENT RELATES; PROVIDED, HOWEVER, THAT UNTIL THE INDEMNITEE RECOVERS
FULL PAYMENT OF ITS LOSSES, ANY AND ALL

 

 

 

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CLAIMS OF THE INDEMNIFYING PARTY AGAINST ANY SUCH THIRD PARTY ON ACCOUNT OF SUCH
PAYMENT ARE HEREBY MADE EXPRESSLY SUBORDINATED AND SUBJECTED IN RIGHT OF PAYMENT
OF THE INDEMNITEE’S RIGHTS AGAINST SUCH THIRD PARTY.  WITHOUT LIMITING THE
GENERALITY OF ANY OTHER PROVISION HEREOF, EACH SUCH INDEMNITEE AND INDEMNIFYING
PARTY WILL DULY EXECUTE UPON REQUEST ALL INSTRUMENTS REASONABLY NECESSARY TO
EVIDENCE AND PERFECT THE ABOVE DESCRIBED SUBROGATION AND SUBORDINATION RIGHTS.

 

18.           COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED SIMULTANEOUSLY IN
ONE OR MORE COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED TO BE AN ORIGINAL, BUT
ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

19.           NO TRIAL BY JURY.  EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH PARTY HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

 

20.           RAMADA. PURCHASER ACKNOWLEDGES THAT RAMADA FRANCHISE SYSTEMS, INC.
(“RAMADA”) MUST CONSENT PURSUANT TO THE RAMADA AGREEMENTS TO BOTH (A) THE SALE
BY SELLER TO PURCHASER OF THE REAL PROPERTY PURSUANT TO THIS AGREEMENT AND
(B) THE SALE BY SELLER TO LUCKY LUCY OF THE BUSINESS PURSUANT TO THE ASSET
PURCHASE AGREEMENT AND THE ASSUMPTION BY LUCKY LUCY OF THE RAMADA AGREEMENTS IN
CONNECTION THEREWITH.  PURCHASER AND LUCKY LUCY SHALL JOINTLY AND SEVERALLY SEEK
TO HAVE LUCKY LUCY ASSUME TO RAMADA AGREEMENTS AND TO OBTAIN ALL CONSENTS
REQUIRED BY THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND THE ASSET
PURCHASE AGREEMENT.  PURCHASER AND LUCKY LUCY SHALL JOINTLY AND SEVERALLY PAY
ALL APPLICATION AND INITIATION FEES AND OTHER COSTS IN CONNECTION WITH SUCH
ASSUMPTION AND CONSENTS.  PROVIDED THAT PURCHASER AND LUCKY LUCY DILIGENTLY SEEK
TO HAVE LUCKY LUCY ASSUME THE RAMADA AGREEMENTS AND TO OBTAIN ALL REQUIRED
CONSENTS, PURCHASER’S AND LUCKY LUCY’S JOINT AND SEVERAL LIABILITY WITH RESPECT
TO THE RAMADA AGREEMENTS, IN THE EVENT THAT LUCKY LUCY IS UNABLE TO ASSUME THE
RAMADA AGREEMENTS FOR ANY REASON, SHALL BE LIMITED TO ONE HUNDRED THOUSAND
DOLLARS ($100,000), AND SELLER SHALL PAY ALL OTHER AMOUNTS DUE THEREUNDER AS A
RESULT OF THE TERMINATION OF THE RAMADA AGREEMENTS.  ALTHOUGH LUCKY LUCY IS NOT
A PARTY TO THIS AGREEMENT, LUCKY LUCY IS JOINTLY AND SEVERALLY LIABLE FOR
PURCHASER’S OBLIGATIONS UNDER THIS SECTION 20 PURSUANT TO THE TERMS AND
CONDITIONS OF THE ASSET PURCHASE AGREEMENT.

 

21.           MISCELLANEOUS.

 

21.1         BUSINESS DAY.  IF THE DATE ON WHICH EITHER PURCHASER OR SELLER IS
REQUIRED TO TAKE ACTION UNDER THIS AGREEMENT IS NOT A BUSINESS DAY, THE ACTION
SHALL BE TAKEN ON THE NEXT SUCCEEDING BUSINESS DAY.

 

21.2         CAPTIONS.  THE CAPTIONS OF THE VARIOUS SECTIONS AND PARAGRAPHS OF
THIS AGREEMENT HAVE BEEN INSERTED ONLY FOR THE PURPOSE OF CONVENIENCE; SUCH
CAPTIONS ARE NOT A PART OF THIS AGREEMENT AND SHALL NOT BE DEEMED IN ANY MANNER
TO MODIFY, EXPLAIN, ENLARGE OR RESTRICT ANY OF THE PROVISIONS OF THIS AGREEMENT.

 

 

 

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21.3         DISCLOSURE.  SELLER AND PURCHASER AGREE THAT THE PROPOSED TERMS AND
CONDITIONS, AND ALL INFORMATION (OTHER THAN INFORMATION WHICH IS A MATTER OF
PUBLIC RECORD OR IS PROVIDED BY OTHER SOURCES READILY AVAILABLE TO THE PUBLIC)
SHARED OR DEVELOPED IN THE CONTEXT OF THIS TRANSACTION, SHALL BE KEPT STRICTLY
CONFIDENTIAL, EXCEPT THAT PURCHASER ACKNOWLEDGES THAT SELLER’S PARENT COMPANY
MAY DESCRIBE THE TERMS HEREOF (AS WELL AS PROVIDE COPIES OF THIS AGREEMENT) IN
REPORTS THAT THE PARENT IS REQUIRED TO FILE WITH GOVERNMENTAL AUTHORITIES, THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION, AND SELLER’S FINANCIERS,
ATTORNEYS AND ACCOUNTANTS.  ANY PUBLIC DISCLOSURES, PRESS RELEASES, OR
ANNOUNCEMENTS CONCERNING THIS AGREEMENT AND THE SALE CONTEMPLATED HEREIN SHALL
BE APPROVED UNANIMOUSLY BY THE PARTIES IN WRITING IN THE EXERCISE OF EACH
PARTY’S REASONABLE DISCRETION.  EITHER PARTY MAY DISCLOSE ANY ITEMS REQUIRED BY
NEVADA GAMING AUTHORITIES, OR ANY OTHER GAMING REGULATORS HAVING JURISDICTION
OVER SELLER.  PURCHASER MAY DISCLOSE SUCH NON-PUBLIC INFORMATION TO ITS
ATTORNEYS, SURVEYORS, ENGINEERS, FINANCIAL ADVISORS, INVESTORS AND LENDERS AS
NECESSARY TO EVALUATE THE REAL PROPERTY.  PURCHASER AGREES THAT WHILE IN
POSSESSION OF MATERIAL NON-PUBLIC INFORMATION CONCERNING SELLER, PURCHASER WILL
NOT TRADE IN THE SECURITIES OF SELLER NOR TIP OR ADVISE OTHERS WITH RESPECT TO
SUCH TRADING.

 

21.4         INVALIDITY.  IF ANY TERM OR OTHER PROVISION OF THIS AGREEMENT IS
INVALID, ILLEGAL OR INCAPABLE OF BEING ENFORCED BY ANY RULE OF LAW OR PUBLIC
POLICY, ALL OTHER CONDITIONS AND PROVISIONS OF THIS AGREEMENT SHALL NEVERTHELESS
REMAIN IN FULL FORCE AND EFFECT SO LONG AS THE ECONOMIC OR LEGAL SUBSTANCE OF
THE TRANSACTIONS CONTEMPLATED HEREBY IS NOT AFFECTED IN ANY MANNER MATERIALLY
ADVERSE TO ANY PARTY.  UPON SUCH DETERMINATION THAT ANY TERM OR OTHER PROVISION
IS INVALID, ILLEGAL OR INCAPABLE OF BEING ENFORCED, THE PARTIES HERETO SHALL
NEGOTIATE IN GOOD FAITH TO MODIFY THIS AGREEMENT SO AS TO EFFECT THE ORIGINAL
INTENT OF THE PARTIES AS CLOSELY AS POSSIBLE IN AN ACCEPTABLE MANNER TO THE END
THAT TRANSACTIONS CONTEMPLATED HEREBY ARE FULFILLED TO THE EXTENT POSSIBLE.

 

21.5         SUCCESSORS AND ASSIGNS.  THIS AGREEMENT SHALL BE BINDING UPON AND
INURE SOLELY TO THE BENEFIT OF EACH PARTY HERETO AND THEIR RESPECTIVE SUCCESSORS
AND ASSIGNS, AND NOTHING IN THIS AGREEMENT, EXPRESS OR IMPLIED, IS INTENDED TO
OR SHALL CONFER UPON ANY OTHER PERSON ANY RIGHT, BENEFIT OR REMEDY OF ANY NATURE
WHATSOEVER UNDER OR BY REASON OF THIS AGREEMENT.

 

21.6         AMBIGUITY.  EACH PARTY HERETO HAS PARTICIPATED IN THE DRAFTING OF
THIS AGREEMENT, WHICH EACH PARTY ACKNOWLEDGES IS THE RESULT OF EXTENSIVE
NEGOTIATIONS BETWEEN THE PARTIES. IN THE EVENT OF ANY AMBIGUITY OR QUESTION OF
INTENT ARISES, THIS AGREEMENT SHALL BE CONSTRUED AS IF DRAFTED JOINTLY BY THE
PARTIES AND NO PRESUMPTION OR BURDEN OF PROOF SHALL ARISE FAVORING OR
DISFAVORING ANY PARTY BY VIRTUE OF THE AUTHORSHIP OF ANY OF THE PROVISIONS OF
THIS AGREEMENT.

 

21.7         TIME OF THE ESSENCE.  TIME IS OF THE ESSENCE WITH RESPECT TO THE
TIME PERIODS SET FORTH IN THIS AGREEMENT.

 

[Signatures appear on the following page.]

 

 

 

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IN WITNESS WHEREOF, Purchaser and Seller have signed this Agreement on the day
and year first above written.

 

 

SELLER:

 

PURCHASER:

Speakeasy Gaming of Las Vegas, Inc., a
Nevada corporation

 

Ganaste LLC, a Nevada limited liability company

 

 

 

 

 

 

By:

/s/ Edson R. Arneault

 

By:

/s/ Michael J. Mixer

 

   Edson R. Arneault, President

 

 

   Michael J. Mixer, as Manager

 

 

 

 

 

 

 

 

By:

/s/ Alexander Rodrigo

 

 

 

 

   Alexander Rodrigo, as Manager

 

 

 

 

 

 

 

 

By:

/s/ Bruce Deifik

 

 

 

 

   Bruce Deifik, as Manager

 

 

 

 

 

 

 

 

By:

/s/ Keith Redmond

 

 

 

 

   Keith Redmond, as Manager

 

 

 

 

 

 

 

 

By:

/s/ Seth Schorr

 

 

 

 

   Seth Schorr, as Manager

 

 

 

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