Exhibit 10.1

 

EXECUTION COPY

 

EQUITY INTEREST PURCHASE AGREEMENT

 

dated as of May 7, 2012

 

by and among

 

PENN NATIONAL GAMING, INC.,

as Buyer

 

HARRAH’S MARYLAND HEIGHTS, LLC,
as the Company

 

CAESARS ENTERTAINMENT OPERATING COMPANY, INC.,
HARRAH’S MARYLAND HEIGHTS OPERATING COMPANY, AND

PLAYERS MARYLAND HEIGHTS NEVADA, LLC

together, as Sellers

 

and

 

CAESARS ENTERTAINMENT CORPORATION,
as Parent

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I. PURCHASE AND SALE OF EQUITY INTERESTS

1

 

 

 

Section 1.1

Purchase and Sale of Equity Interests

1

Section 1.2

Excluded Assets

3

Section 1.3

Retention of Assets

4

Section 1.4

Assignability and Consents

4

Section 1.5

Removal of Excluded Assets

5

 

 

 

ARTICLE II. TREATMENT OF LIABILITIES

6

 

 

 

Section 2.1

Assumed Liabilities

6

Section 2.2

Excluded Liabilities

7

 

 

 

ARTICLE III. PURCHASE PRICE AND DEPOSIT

8

 

 

 

Section 3.1

Purchase Price

8

Section 3.2

Deposit

8

Section 3.3

Allocation of Purchase Price

8

Section 3.4

Risk of Loss

9

Section 3.5

Tax Withholding

9

 

 

 

ARTICLE IV. WORKING CAPITAL ADJUSTMENT AND OTHER ADJUSTMENTS

10

 

 

 

Section 4.1

Estimated Closing Statement

10

Section 4.2

Estimated Operations Statement

10

Section 4.3

Final Adjustments

10

Section 4.4

Accounts Receivable; Accounts Payable; Deposits

12

Section 4.5

Corrective Actions

12

Section 4.6

Prorations

12

 

 

 

ARTICLE V. CLOSING

13

 

 

 

Section 5.1

Time and Place

13

Section 5.2

Deliveries at Closing

14

 

 

 

ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF PARENT AND SELLERS

15

 

 

 

Section 6.1

Organization of Parent and Sellers

15

Section 6.2

Authority; No Conflict; Required Filings and Consents

15

Section 6.3

Title to Equity Interests

16

Section 6.4

Litigation

17

 

 

 

ARTICLE VII. REPRESENTATIONS AND WARRANTIES OF THE COMPANY

17

 

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Section 7.1

Organization of the Company; Capitalization

17

Section 7.2

Authority; No Conflict; Required Filings and Consents

18

Section 7.3

Financial Statements

19

Section 7.4

No Undisclosed Liabilities

19

Section 7.5

Taxes

19

Section 7.6

Real Property

21

Section 7.7

Intellectual Property

22

Section 7.8

Agreements, Contracts and Commitments

22

Section 7.9

Litigation

23

Section 7.10

Environmental Matters

23

Section 7.11

Permits; Compliance with Laws

24

Section 7.12

Labor Matters

24

Section 7.13

Employee Benefits

25

Section 7.14

Brokers

27

Section 7.15

Title to Purchased Assets

27

Section 7.16

Affiliate Transactions

27

Section 7.17

Minimum Cash

27

Section 7.18

Vendors

27

Section 7.19

Absence of Changes

27

Section 7.20

Insurance Coverage

27

 

 

 

ARTICLE VIII. REPRESENTATIONS AND WARRANTIES OF BUYER

28

 

 

Section 8.1

Organization

28

Section 8.2

Authority; No Conflict; Required Filings and Consents

28

Section 8.3

Brokers

29

Section 8.4

Financing

29

Section 8.5

Licensability of Principals

29

Section 8.6

Permits; Compliance with Gaming Laws

30

Section 8.7

Waiver of Buyer’s Further Due Diligence Investigation

30

Section 8.8

Litigation

31

 

 

 

ARTICLE IX. COVENANTS

31

 

 

Section 9.1

Conduct of Business Prior to the Closing

31

Section 9.2

Cooperation; Notice; Cure

34

Section 9.3

No Solicitation

34

Section 9.4

Employee Matters

35

Section 9.5

Access to Information and the Real Property; Post-Closing Cooperation

37

Section 9.6

Governmental Approvals

39

Section 9.7

Publicity

41

Section 9.8

Further Assurances and Actions

41

Section 9.9

Transfer Taxes; HSR Filing Fee

42

Section 9.10

No Control

42

Section 9.11

Reservations; Guests; Valet Parking; Other Transition Matters

42

Section 9.12

Transfer of Utilities

44

 

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Section 9.13

Certain Transactions

45

Section 9.14

FCC Approvals

45

Section 9.15

Insurance and Casualty

45

Section 9.16

Certain Notifications

46

Section 9.17

Non-Solicitation

46

Section 9.18

Transfer of Assets

46

Section 9.19

Customer List

47

Section 9.20

Lien Release

47

Section 9.21

Financing

47

 

 

 

ARTICLE X. CONDITIONS TO CLOSING

47

 

 

 

Section 10.1

Conditions to Each Party’s Obligation to Effect the Closing

47

Section 10.2

Additional Conditions to Obligations of Buyer

48

Section 10.3

Additional Conditions to Obligations of Sellers

49

 

 

 

ARTICLE XI. TERMINATION AND AMENDMENT

49

 

 

Section 11.1

Termination

49

Section 11.2

Effect of Termination

50

 

 

 

ARTICLE XII. SURVIVAL; INDEMNIFICATION

52

 

 

Section 12.1

Survival of Representations, Warranties, Covenants and Agreements

52

Section 12.2

Indemnification

52

Section 12.3

Procedure for Claims between Parties

54

Section 12.4

Defense of Third Party Claims

54

Section 12.5

Resolution of Conflicts and Claims

56

Section 12.6

Limitations on Indemnity

56

Section 12.7

Payment of Damages

57

Section 12.8

Exclusive Remedy

57

Section 12.9

Tax Matters

58

 

 

 

ARTICLE XIII. TITLE TO REAL PROPERTY

61

 

 

Section 13.1

Title Policy and UCC Search

61

Section 13.2

Defects Arising After the Effective Date

61

Section 13.3

Failure to Cure Title Defects

62

Section 13.4

Survey

63

Section 13.5

AS IS

63

Section 13.6

No Conflict

66

 

 

 

ARTICLE XIV. MISCELLANEOUS

66

 

 

 

Section 14.1

Definitions

66

Section 14.2

Governing Law; Consent to Jurisdiction; Waiver of Trial by Jury

78

Section 14.3

Notices

79

 

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Section 14.4

Interpretation

80

Section 14.5

Entire Agreement

81

Section 14.6

Severability

81

Section 14.7

Assignment

81

Section 14.8

Parties of Interest

81

Section 14.9

Counterparts

81

Section 14.10

Mutual Drafting

81

Section 14.11

Amendment

82

Section 14.12

Extension; Waiver

82

Section 14.13

Time of Essence

82

 

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EXHIBITS

 

 

 

Exhibit A

Form of Bill of Sale and Assignment

 

 

 

 

Exhibit B

Form of Assignment and Assumption Agreement

 

 

 

 

Exhibit C

Form of Trademark Assignment Agreement

 

 

 

 

Exhibit D

Form of Deposit Escrow Agreement

 

 

 

 

Exhibit E

Form of Customer List

 

 

 

 

Exhibit F

Form of Assignment of Equity Interests

 

 

SCHEDULES

 

 

 

Schedule A

Rebranding Plan

 

 

 

 

Schedule B

Calculation of Net Working Capital

 

 

 

 

Schedule C

Calculation of Tray Ledger and Markers

 

 

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EQUITY INTEREST PURCHASE AGREEMENT

 

THIS EQUITY INTEREST PURCHASE AGREEMENT (this “Agreement”) is made and entered
into as of May 7, 2012 (the “Effective Date”), by and among Penn National
Gaming, Inc., a Pennsylvania corporation (“Buyer”), Caesars Entertainment
Corporation, a Delaware corporation (“Parent”), Caesars Entertainment Operating
Company, Inc., a Delaware corporation (“CEOC”), Harrah’s Maryland Heights
Operating Company, a Nevada corporation (“HMHO”), Players Maryland Heights
Nevada, LLC, a Nevada limited liability company (“PMHN”, together with CEOC and
HMHO, “Sellers”), and Harrah’s Maryland Heights, LLC, a Delaware limited
liability company (the “Company”). Capitalized terms used herein and not
otherwise defined shall have the meanings set forth in Section 14.1.

 

WHEREAS, Sellers are the beneficial and record owners of all of the issued and
outstanding membership interests of the Company (the “Equity Interests”);

 

WHEREAS, the Board of Directors of Parent believes that it is in the best
interests of the Company, Sellers and Sellers’ members and stockholders to sell
all of the Equity Interests; and

 

WHEREAS, Buyer desires to acquire from Sellers and Sellers desire to sell to
Buyer, all of Sellers’ right, title and interest in and to the issued and
outstanding Equity Interests on the terms and subject to the conditions set
forth herein, after which the Company shall become a wholly-owned subsidiary of
Buyer.

 

NOW, THEREFORE, the parties hereto, in consideration of the premises and of the
mutual representations, warranties and covenants contained herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, agree as follows:

 

ARTICLE I.

PURCHASE AND SALE OF EQUITY INTERESTS

 

Section 1.1             Purchase and Sale of Equity Interests. Upon the terms
and subject to the conditions set forth in this Agreement, at the Closing,
Sellers shall sell and Buyer shall purchase from Sellers, the Equity Interests
free and clear of all Liens and Encumbrances other than Permitted Liens and
Permitted Encumbrances. As a result of Buyer’s acquisition of the Equity
Interests, Buyer shall indirectly acquire all of the Company’s right, title and
interest in, and under those certain rights and assets set forth below, free and
clear of all Liens and Encumbrances other than Permitted Liens and Permitted
Encumbrances, but excluding the Excluded Assets (the “Purchased Assets”):

 

(a)           the Real Property;

 

(b)           subject to Section 1.4, the Assumed Contracts;

 

(c)           the Acquired Personal Property;

 

(d)           Intentionally Omitted;

 

(e)           the Tray Ledger (pursuant to Section 4.2(a));

 

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(f)            the Markers (pursuant to Section 4.2(b));

 

(g)           Intentionally omitted.

 

(h)           the Transferred Marks and Domain Names, the Other Transferred
Registered IP, and the other Intellectual Property listed on Section 1.1(h) of
the Company Disclosure Letter (collectively, the “Transferred Intellectual
Property”);

 

(i)            the organizational documents, minute and stock books and records,
and corporate seals of the Company;

 

(j)            (i) all corporate records of the Company, (ii) all other books
and records of the Company relating exclusively to the Business (except (A) to
the extent related to the Excluded Liabilities, the Excluded Assets or otherwise
proprietary to Sellers or their Affiliates (other than the Company) and (B) the
Customer Database), including all architectural, structural, service manuals,
engineering and mechanical plans, electrical, soil, wetlands, environmental, and
similar reports, studies and audits in the Company’s possession or control,
(iii) all plans and specifications for the Casino in the Company’s possession or
control and (iv) all human resources and other employee-related files and
records relating to the Transferred Employees, except to the extent prohibited
by Law; provided, however, Sellers may retain archival copies of all books,
files and records as set forth in Section 1.3;

 

(k)           the Customer List;

 

(l)            the Company Permits, Governmental Approvals and Gaming Approvals
exclusively related to the Casino, and pending applications therefor, to the
extent transferable by Law;

 

(m)          all current assets reflected in the Final Closing Net Working
Capital, including Gift Certificates and Accounts Receivable;

 

(n)           all bookings, contracts, or reservations for the use or occupancy
of guest rooms and/or meeting and banquet facilities of the Casino which use or
occupancy is scheduled to occur on or after the Closing Date;

 

(o)           all advertising, marketing and promotional materials exclusively
used or held for use in the Business and to the extent such materials do not
include any System Marks and other than the Harrah’s Branded Paraphernalia;

 

(p)           all landline telephone numbers used at the Casino on the Closing
Date;

 

(q)           all rights, claims, rebates, discounts and credits (including all
guarantees, indemnities, warranties and similar rights), performance or other
bonds, security or other deposits, advance payments and prepaid rents in favor
of the Company to the extent relating exclusively to (i) the Business as of the
Closing Date, (ii) the Purchased Assets, or (iii) the Assumed Liabilities;

 

(r)            all goodwill associated with the Business;

 

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(s)           all refunds or rebates of Taxes to which Buyer is entitled under
Section 12.9(g);

 

(t)            the Rewards Information;

 

(u)           any and all insurance proceeds, condemnation awards or other
compensation awards for loss or damage to any Purchased Assets, the Real
Property and the Business to the extent occurring after the date hereof but
prior to the Closing Date, and all right and claim of Sellers and the Company or
any of their respective Affiliates to any such insurance or other compensation
not paid by the Closing Date; and

 

(v)           all other assets and properties of the Company exclusively used or
held for use in connection with the Business.

 

Section 1.2             Excluded Assets.  Notwithstanding anything to the
contrary contained in this Agreement, immediately prior to the Closing, the
Company shall assign to Sellers (or their designee) and Sellers (or their
designee) shall obtain the right, title and interest in and to each and all of
the following assets of the Company (the “Excluded Assets”):

 

(a)           the Excluded Contracts;

 

(b)           any rights, claims and credits (including all guarantees,
indemnities, warranties and similar rights) in favor of the Company to the
extent relating to (i) any excluded assets set forth in this Section 1.2,
(ii) any Excluded Liability or (iii) the operation of the Business prior to the
Closing Date, in the case of clause (iii), other than those that are
specifically Purchased Assets under Section 1.1;

 

(c)           the Markers listed on Section 1.2(c) of the Company Disclosure
Letter;

 

(d)           except for the Tray Ledger and the Markers (other than those
Markers listed on Section 1.2(c) of the Company Disclosure Letter) (all of which
are part of the Purchased Assets but shall be purchased in accordance with
Section 4.2 hereof), and except for the Front Money which shall be treated as
set forth in Section 9.11(d) hereof, all chips or tokens of other casinos, cash,
cash equivalents, bank deposits or similar cash items of Sellers, the Company or
Sellers’ Affiliates held at the Casino as of the Closing to the extent not
reflected in the Final Closing Net Working Capital;

 

(e)           all refunds or rebates of Taxes to which Sellers are entitled
under Section 12.9(g);

 

(f)            all of the human resources and other employee-related files and
records, other than such files and records relating exclusively to the
Transferred Employees (which files and records Sellers may retain an archival
copy of, to the extent permitted by Law);

 

(g)           the Excluded Personal Property;

 

(h)           the Excluded Software;

 

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(i)            all indebtedness, accounts payable, or other obligations owed to
the Company by any Seller or any of their Affiliates;

 

(j)            without limitation to Buyer’s rights pursuant to Sections 1.1(k) 
and 1.1(t), the Customer Database;

 

(k)           all data, files and other materials located on any storage device
(including personal computers and servers) located at the Real Property (other
than the books and records described in Section 1.1(j)  hereof);

 

(l)            without limitation to Buyer’s rights pursuant to Sections 1.1(k) 
and 1.1(t), the Total Rewards Program and any other player loyalty or rewards
program of Sellers or their Affiliates and all customer related data;

 

(m)          any assets set forth on Section 1.2(m) of the Company Disclosure
Letter;

 

(n)           the Company Benefit Plans;

 

(o)           the Company Insurance Policies (except as provided in
Section 9.15);

 

(p)           the System Marks;

 

(q)           the Harrah’s Branded Paraphernalia; and

 

(r)            all other assets and properties of the Company not exclusively
used or held for use in connection with the Business.

 

Section 1.3             Retention of Assets. Notwithstanding anything to the
contrary contained in this Agreement, Sellers and their Affiliates may retain
and use, at their own expense, archival copies of all of the Assumed Contracts,
books, records and other documents or materials conveyed hereunder, in each
case, which (a) are used in connection with Sellers’ or any of their Affiliates’
businesses other than the Business or (b) if Sellers, in good faith, determine
that Sellers are reasonably likely to need access to, in connection with the
preparation or filing of any Tax Returns or compliance with any other Tax
reporting obligations or the defense (or any counterclaim, cross-claim or
similar claim in connection therewith) of any suit, claim, action, proceeding or
investigation (including any Tax audit or examination) against or by Sellers,
the Company or any of its Affiliates pending or threatened as of the Closing
Date; provided, that Sellers shall, and shall cause their Affiliates to, hold
such documents or materials relating to the Business, and all confidential or
proprietary information contained therein, confidential pursuant to
Section 9.5(b).

 

Section 1.4             Assignability and Consents.

 

(a)           Notwithstanding anything to the contrary contained in this
Agreement, if the attempted or actual conveyance, assignment or transfer to
Sellers (or their designee) of any Excluded Assets is non-assignable or
non-transferrable, by its terms, without the consent of a third party (each, a
“Non-Assignable Excluded Asset”), then Sellers and Buyer shall each use their
reasonable best efforts to obtain the authorization, approval, consent or waiver
of such other party to the assignment of any such Non-Assignable Excluded Asset.
Notwithstanding the

 

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foregoing, in no event shall the failure to obtain a consent with respect to a
Non-Assignable Excluded Asset delay or otherwise impede the Closing, but the
Closing shall not constitute the sale, conveyance, assignment, transfer or
delivery of any such Non-Assignable Excluded Asset, and this Agreement shall not
constitute a conveyance, assignment, transfer or delivery of any such
Non-Assignable Excluded Asset unless and until such authorization, approval,
consent or waiver is obtained. The parties shall enter into a commercially
reasonable arrangement to provide that Sellers shall receive the interest of the
Company in the benefits and obligations under such Non-Assignable Excluded
Asset, and Sellers shall be liable to the Company in a fashion equivalent to
what Sellers’ Liabilities would be under the Non-Assignable Excluded Asset if it
were assigned, until such time as such third party authorization, approval,
consent or waiver shall have been obtained, and such arrangement shall include
performance by the Company as an agent of Sellers to the extent commercially
reasonable. Provided that Sellers are liable for all Liabilities related to a
Non-Assignable Excluded Asset that Sellers would otherwise be liable for under
this Agreement if such Non-Assignable Excluded Asset constituted an Excluded
Asset, Buyer shall, and shall cause the Company to, promptly pay over to Sellers
(or their designee) the net amount (after expenses and Taxes) of all payments
received by it in respect of such Non-Assignable Excluded Asset. In the event
that the Company acts as Sellers’ agent or is otherwise required to act to
fulfill obligations related to a Non-Assignable Excluded Asset pursuant to this
Section 1.4(a), Sellers shall assist and fully cooperate with Buyer and the
Company in fulfilling such obligations.

 

(b)           Once authorization, approval or waiver of or consent for the
conveyance, assignment or transfer of any such Non-Assignable Excluded Asset is
obtained, such Non-Assignable Excluded Asset shall be conveyed, assigned,
transferred and delivered to Sellers (or their designee) without any further
action by the parties hereto. Notwithstanding anything to the contrary contained
in this Agreement, Sellers shall assume all Liabilities in respect of any
Non-Assignable Excluded Asset that Sellers would otherwise assume under this
Agreement if such Non-Assignable Excluded Asset constituted an Excluded Asset if
it is receiving the benefits thereof; provided, further, that Sellers shall also
be liable to the Company for performing its obligations under the arrangements
described in Section 1.4(c) hereof.

 

(c)           Buyer understands and agrees that it is solely Buyer’s
responsibility to obtain any and all operating agreements (other than the
Assumed Contracts) necessary to conduct the Business from and after the Closing
Date, including replacement software license agreements for the software which
will replace the Excluded Software. Subject to the terms hereof, Buyer shall
also be responsible for obtaining new licenses and permits for the operation of
the Business from and after the Closing. Except as set forth in
Section 1.1(l) hereof, no licenses or permits will be transferred by Sellers in
connection with the sale of the Equity Interests.

 

Section 1.5             Removal of Excluded Assets. All items located at the
Real Property that constitute Excluded Assets may be removed on or prior to the
Closing Date and within ninety (90) days after the Closing Date (the “Removal
Period”) by Sellers, their Affiliates or their respective Representatives, with
the removing party making any repairs necessary as a result of any damage caused
during such removal, but without any obligation on the part of Sellers, their
Affiliates or any removing party to replace any item so removed. Buyer will
provide Sellers, their Affiliates and their respective Representatives with
reasonable access to the Real Property to effect such removal, at reasonable
times within the Removal Period and after at least one (1)

 

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business day’s prior notice to Buyer, and Sellers will use reasonable efforts to
minimize disruption to Buyer’s operations. Buyer, at its option, will have the
right to have a Representative present during any such removal activity. Sellers
recognize that Buyer will be replacing Excluded Software and that Buyer desires
that its replacement software will be operational as of the Closing. Sellers
agree to, and to cause the Company to, cooperate reasonably with Buyer in
effecting the transition from Excluded Software to replacement software, by
allowing Buyer access to the Real Property to install the replacement software;
provided that: (a) there shall be no material interference with the Business
before the Closing; (b) Sellers shall be reimbursed for any reasonable
out-of-pocket costs incurred by the Company in connection with such cooperation;
and (c) if Sellers or the Company shall be required to reveal proprietary
information of Sellers or their Affiliates to Buyer in connection with such
cooperation, then Sellers or the Company will, at Sellers’ option, either
(i) not de-install third party Excluded Software that is now installed on
personal computers that are included in the Acquired Personal Property (unless
required to do so by Law or by agreement with the provider of the Excluded
Software) and Buyer agrees that Buyer will either obtain new licenses for such
Excluded Software or cease to use such Excluded Software following the Closing,
or (ii) de-install third party Excluded Software that is now installed on
personal computers included in the Acquired Personal Property. Buyer’s agreement
pursuant to this Section 1.5 shall survive the Closing and shall be covered by
Buyer’s indemnification obligations in ARTICLE XII hereof and enforceable by
Sellers by any means available at Law or equity, including injunctive relief,
which Buyer hereby agrees is an appropriate remedy. If Sellers do not remove all
of the Excluded Assets located at the Real Property within the Removal Period,
then Buyer may dispose of or retain any such remaining Excluded Assets.

 

ARTICLE II.

TREATMENT OF LIABILITIES

 

Section 2.1             Assumed Liabilities. Upon the terms and subject to the
conditions set forth in this Agreement, the Company shall retain and be solely
responsible for, and as a result of Buyer’s acquisition of the Equity Interests
Buyer shall indirectly assume, only the Liabilities of the Company set forth in
this Section 2.1, other than the Excluded Liabilities (collectively the “Assumed
Liabilities”):

 

(a)           all Liabilities relating to the Purchased Assets or the Business,
including all Liabilities, burdens and obligations arising in respect to any
Assumed Contracts, accruing, arising out of, or relating to events, occurrences,
pending or threatened litigation, acts, omissions and claims happening from and
after the Closing;

 

(b)           all Liabilities for replacement of, or refund for, damaged,
defective or returned goods relating to the Purchased Assets from and after the
Closing, including items purchased in a gift shop or similar facility at the
Casino from and after the Closing, but not including any pending product
liability or litigation claims relating to the sale of any goods happening prior
to the Closing;

 

(c)           all Liabilities with respect to entertainment and hotel
reservations relating to the Casino (to the extent reflected in the Final
Closing Net Working Capital) from and after the Closing;

 

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(d)           all Liabilities for (i) Taxes arising out of or relating to the
ownership of the Company or the Purchased Assets after the Closing Date and
(ii) Transfer Taxes that are the responsibility of Buyer pursuant to
Section 9.9(a), in each case other than any Excluded Taxes (it being agreed and
understood that this clause (d) is the only clause of Section 2.1 that applies
to Taxes);

 

(e)           any Liabilities relating to the employment of the Transferred
Employees by Buyer and its Affiliates (including, following the Closing, the
Company and its Subsidiaries) solely to the extent accruing, arising out of, or
relating to events, occurrences, acts, omissions and claims happening after the
Closing (for the avoidance of doubt, including any Liabilities relating to the
termination of any Transferred Employee from and after the Closing);

 

(f)            all current Liabilities reflected in the Final Closing Net
Working Capital, including the Progressive Liabilities and the Customer
Deposits;

 

(g)           any Liabilities assumed by Buyer pursuant to
Section 9.4(f) hereof;

 

(h)           without limiting the rights and obligations of the parties set
forth in ARTICLE XII hereof, all Liabilities under Environmental Laws, including
Environmental Liabilities relating to, resulting from, caused by or arising out
of ownership, operation or control of the Real Property or the other Purchased
Assets, arising before or after the Closing Date, and any Liability relating to
contamination or exposure to Hazardous Substances at or attributable to the Real
Property or the other Purchased Assets;

 

(i)            all of the Company’s gaming chips and tokens with respect to the
Business, which are branded with the name, design, logo or other similar indicia
of the Casino, that are in circulation as of the Closing (collectively, the
“Chips and Tokens”); and

 

(j)            any items set forth on Section 2.1 of the Company Disclosure
Letter.

 

Section 2.2             Excluded Liabilities. Notwithstanding anything contained
in this Agreement to the contrary, immediately prior to the Closing, the Company
shall assign and Sellers shall assume, and from and after such time Sellers
shall be responsible for, only the following Liabilities of the Company
(“Excluded Liabilities”):

 

(a)           except as specifically listed in Section 2.1, all Liabilities
relating to any Purchased Assets or the Business accruing, arising out of, or
relating to events, occurrences, pending or threatened litigation, acts,
omissions and claims happening or existing prior to the Closing, including all
Liabilities arising from any breach of any Assumed Contract by Sellers or the
Company on or prior to the Closing;

 

(b)           any Liabilities for any Excluded Taxes;

 

(c)           any Liabilities relating to the Transferred Employees accruing,
arising out of, or relating to events, occurrences, pending or threatened
litigation, acts, omissions and claims happening or existing prior to the
Closing and any Liabilities arising out of or relating to the employment of any
directors, employees or other service providers of Sellers or any of their
Affiliates (other than the Transferred Employees), regardless of when arising;

 

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(d)           any Liabilities owed to any Seller or any of their Affiliates
other than the Company;

 

(e)           any Liability that relates to any Excluded Asset, unless otherwise
included in the Final Closing Net Working Capital;

 

(f)            any pending product liability or litigation claims relating to
the sale of any goods happening prior to the Closing; and

 

(g)           any Liability of the Company for expenses or fees relating to the
preparation, negotiation or entering into of this Agreement, including fees of
financial advisors, attorneys, consultants and accountants.

 

ARTICLE III.

PURCHASE PRICE AND DEPOSIT

 

Section 3.1             Purchase Price. At the Closing, as consideration for the
Equity Interests, Buyer shall deliver or cause to be delivered by electronic
transfer of immediately available funds to an account designated by Sellers a
cash payment equal to the sum of (a) six hundred ten million dollars
($610,000,000) (the “Purchase Price”) plus (b) the Estimated Closing Payment
(which can be a positive or negative number) plus (c) the Estimated Operations
Payment. The Purchase Price, together with the Estimated Closing Payment and the
Estimated Operations Payment is the “Closing Payment.”

 

Section 3.2             Deposit. On the date hereof, Buyer shall deposit nine
million one-hundred fifty thousand dollars ($9,150,000) (the “Deposit”) with
Deutsche Bank National Trust Company (the “Escrow Agent”) pursuant to an escrow
agreement in substantially the form attached hereto as Exhibit D (the “Deposit
Escrow Agreement”) executed and delivered by Parent, Buyer and the Escrow Agent
on the Effective Date; provided, further that for each two-month period by which
the Outside Date is extended by Parent or Buyer pursuant to Section 5.1(b)(ii),
Buyer shall, subject to Section 5.1(b)(iii), deposit an additional nine million
one-hundred fifty thousand dollars ($9,150,000) (each, an “Extension Deposit”)
with the Escrow Agent pursuant to the Deposit Escrow Agreement promptly and in
any event within three (3) business days of such extension. Upon the Closing,
the Deposit and any Extension Deposit, plus the interest accrued thereon shall
be credited against the Purchase Price and the parties shall instruct the Escrow
Agent to promptly release and pay the Deposit and any Extension Deposit, plus
the interest accrued thereon to Parent (or its designee) pursuant to the terms
of the Deposit Escrow Agreement. Upon the termination of this Agreement, the
parties shall instruct the Escrow Agent to promptly release and pay the Deposit
and any Extension Deposit, plus the interest accrued thereon to Buyer or Parent,
as applicable, pursuant to Section 11.2(c) hereof and the terms of the Deposit
Escrow Agreement. In the event of any inconsistency between the terms and
provisions of the Deposit Escrow Agreement and the terms and provisions of this
Agreement, the terms and provisions of this Agreement shall control, absent an
express written agreement between the parties hereto to the contrary, which
written agreement acknowledges and expressly amends this Section 3.2.

 

Section 3.3             Allocation of Purchase Price. For federal income Tax and
applicable state and local Tax Purposes, Buyer and Sellers hereby agree to treat
(and to cause their respective Affiliates to treat) the purchase and sale of
Equity Interests pursuant to this Agreement in

 

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accordance with Revenue Ruling 99-6 (Situation 2). No more than thirty (30) days
after the Determination Date, Buyer shall prepare and deliver to Sellers a
written statement setting forth the allocation of the purchase price (as
determined for federal income tax purposes, taking into account any additional
amounts payable pursuant to Section 4.3 and any assumed liabilities that are
required to be treated as part of the purchase price for federal income tax
purposes) among the Purchased Assets (and any other assets that are considered
to be acquired for federal income tax purposes) in accordance with Section 1060
of the Code and the Treasury Regulations thereunder (the “Purchase Price
Allocation”). Buyer and Sellers shall endeavor in good faith to agree on the
Purchase Price Allocation. If Buyer and Sellers have not agreed on the Purchase
Price Allocation within sixty (60) days following the Determination Date, then
any disputed matter(s) will be finally and conclusively resolved by an
independent accounting firm of recognized national standing reasonably
acceptable to Buyer and Sellers with no existing relationship with either party
(the “Auditor”) in accordance with this Agreement, as promptly as practicable,
and such resolution(s) will be reflected on the Purchase Price Allocation,
provided that the resolution for each disputed item contained in the Auditor’s
determination shall be made subject to the definitions and principles set forth
in this Agreement, and shall be consistent with either the position of Sellers
or Buyer. Buyer and Sellers shall each use its reasonable best efforts to
furnish to the Auditor such work papers and other documents and information
pertaining to the disputed item as the Auditor may request. Sellers and Buyer
shall bear their own expenses in the preparation and review of the Purchase
Price Allocation, except that the fees and expenses of the Auditor shall be
borne equally by Buyer on the one hand and Sellers on the other hand. Buyer and
Sellers shall file all Tax Returns (including, but not limited to, IRS
Form 8594) consistent with the Purchase Price Allocation, and shall not take any
position inconsistent with the Purchase Price Allocation or agree to any
proposed adjustment to the Purchase Price Allocation by any Governmental Entity,
without first giving the other parties prior written notice and an opportunity
to confer regarding such adjustment; provided, however, that the Purchase Price
Allocation shall be adjusted by any other amounts paid under this Agreement
following the Determination Date that affect the purchase price for federal
income tax purposes; and provided, further, that nothing contained herein shall
prevent Buyer or Sellers from settling any proposed deficiency or adjustment by
any Governmental Entity based upon or arising out of the Purchase Price
Allocation, or require Buyer or Sellers to litigate before any court any
proposed deficiency or adjustment by any Governmental Entity challenging the
Purchase Price Allocation.

 

Section 3.4             Risk of Loss. Subject to Section 9.15 hereof, until the
Closing, Sellers shall bear the risk of any loss or damage to the Company,
including the Purchased Assets, from condemnation, fire, casualty or any other
occurrence. Following the Closing, Buyer shall bear the risk of any loss or
damage to the Company, including the Purchased Assets, from condemnation, fire,
casualty or any other occurrence.

 

Section 3.5             Tax Withholding. Notwithstanding anything in this
Agreement to the contrary, Buyer shall be entitled to deduct and withhold from
any amounts otherwise payable under this Agreement to Sellers or any other
Person such amounts as are required to be deducted or withheld under the Code,
or any provision of applicable Law with respect to the making of such payment.
To the extent that amounts are so deducted and withheld and paid over to the
applicable Governmental Entity, such deducted and withheld amounts shall be
treated for all purposes of this Agreement as having been paid to Sellers or
such other Person in respect of which such deduction and withholding were made.

 

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ARTICLE IV.

WORKING CAPITAL ADJUSTMENT AND OTHER ADJUSTMENTS

 

Section 4.1             Estimated Closing Statement. No less than five
(5) business days prior to the Closing Date, Sellers shall prepare and deliver
to Buyer a written closing statement (the “Estimated Closing Statement”) of the
Estimated Closing Net Working Capital, including the resulting Estimated Closing
Net Working Capital Overage (if any) or Estimated Closing Net Working Capital
Shortage (if any), and the proration amounts pursuant to Section 4.6 (to the
extent not already reflected in the Estimated Closing Net Working Capital),
which Estimated Closing Statement shall be prepared in good faith and on a basis
consistent with the preparation of the Financial Information and the calculation
of Net Working Capital set forth on Schedule B. Any amounts determined to be due
and owing to Sellers pursuant to the Estimated Closing Statement shall be paid
by Buyer at the Closing pursuant to Section 3.1 hereof (the “Estimated Closing
Payment”). Any amounts determined to be due and owing to Buyer by Sellers
pursuant to the Estimated Closing Statement shall reduce the Closing Payment
payable to Sellers at the Closing pursuant to Section 3.1.

 

Section 4.2             Estimated Operations Statement. Not less than five
(5) business days prior to the Closing Date, Sellers shall prepare and deliver
to Buyer an estimated accounting for the Casino as of the Closing Date of each
of the items set forth in this Section 4.2 (the “Estimated Operations
Statement”), which Estimated Operations Statement shall be prepared in good
faith and on a basis consistent with the calculation of the Tray Ledger and
Markers set forth on Schedule C. All amounts determined to be due and owing to
Sellers by Buyer pursuant to the Estimated Operations Statement shall be paid by
Buyer to Sellers at the Closing, pursuant to Section 3.1 hereof (the “Estimated
Operations Payment”).

 

(a)           Tray Ledger. Buyer shall purchase the Tray Ledger for the Casino
at the face amount of such Tray Ledger as set forth in the Estimated Operations
Statement.

 

(b)           Markers. Buyer shall purchase the Markers for the Casino from
Sellers at the face amount of such Markers as set forth in the Estimated
Operations Statement.

 

(c)           House Funds. Buyer and Sellers shall mutually agree upon a
procedure consistent with the counting of House Funds in the Ordinary Course of
Business and in accordance with applicable Laws for counting and determining all
House Funds as of the Closing, with such amount being included in the
Calculation of the Estimated Closing Net Working Capital. Buyer shall have no
obligation to purchase chips or tokens of other casinos, all of which shall be
retained by Sellers and are Excluded Assets.

 

Section 4.3             Final Adjustments.

 

(a)           No more than ninety (90) days after the Closing Date, Sellers
shall prepare and deliver to Buyer a written statement (the “Final Closing
Statement”) of the Final Closing Net Working Capital, including the resulting
Final Closing Net Working Capital Overage (if any) or Final Closing Net Working
Capital Shortage (if any), and including a detailed breakdown of the various
amounts of each component of Net Working Capital, and the proration amounts
pursuant to Section 4.6 (to the extent not already reflected in the Estimated
Closing Net Working Capital), which Final Closing Statement shall be prepared in
good faith and on a basis consistent with the preparation of the Financial
Information and the calculation of Net Working Capital set forth on

 

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Schedule B. Any such amounts determined pursuant to the Final Closing Statement
shall be paid to either Sellers or Buyer pursuant to Section 4.3(d) hereof (the
“Final Closing Payment”).

 

(b)           No more than ten (10) business days after the Closing Date,
Sellers shall deliver to Buyer a final accounting as of the Closing of each of
the items set forth in Section 4.2 hereof (the “Final Operations Statement”),
which Final Operations Statement shall be prepared in good faith and on a basis
consistent with the calculation of the Tray Ledger and Markers set forth on
Schedule C. Any such amounts determined pursuant to the Final Operations
Statement shall be paid to either Sellers or Buyer, as applicable, pursuant to
Section 4.3(d) hereof (the “Final Operations Payment”).

 

(c)           If Buyer disagrees with the calculation of any amounts on the
Final Closing Statement and/or the Final Operations Statement (collectively, the
“Final Statements”), Buyer shall, within twenty (20) business days after its
receipt of the applicable Final Statement, notify Sellers of such disagreement
in writing, setting forth in detail the particulars of such disagreement.
Sellers will provide Buyer reasonable access to any of Sellers’ records and
relevant employees not otherwise available to Buyer as a result of the
transactions contemplated hereby, to the extent reasonably related to Buyer’s
review of the Final Statements. If Buyer does not provide such notice of
disagreement within the twenty (20) business day period, Buyer shall be deemed
to have accepted the applicable Final Statement and the calculation of all
amounts set forth thereon, which shall be final, binding and conclusive for
purposes of this Agreement and not subject to any further recourse by Buyer or
its Affiliates. If any such notice of disagreement is timely provided, Buyer and
Sellers shall use reasonable best efforts for a period of five (5) business days
(or such longer period as they may mutually agree) to resolve any disagreements
with respect to the calculation of any and all amounts set forth on the
applicable Final Statement. If, at the end of such period, the parties are
unable to fully resolve the disagreements, the Auditor shall resolve any
remaining disagreements. The Auditor shall be instructed to (i) consider only
such matters as to which there is a disagreement, (ii) determine, as promptly as
practicable, whether the disputed amounts set forth on the applicable Final
Statement were prepared in accordance with the standards set forth in this
Agreement, and (iii) deliver, as promptly as practicable, to Sellers and Buyer
its determination in writing. The resolution for each disputed item contained in
the Auditor’s determination shall be made subject to the definitions and
principles set forth in this Agreement, and shall be consistent with either the
position of Sellers or Buyer. Sellers and Buyer shall bear their own expenses in
the preparation and review of the Estimated Closing Statement, Final Closing
Statement, Estimated Operations Statement and Final Operations Statement, except
that the fees and expenses of the Auditor shall be paid one-half by Buyer and
one-half by Sellers. The determination of the Auditor shall be final, binding
and conclusive for purposes of this Agreement and not subject to any further
recourse by Buyer, Sellers or their respective Affiliates. Any dispute with
respect to the Final Statements will not affect any undisputed amounts in the
Final Statements or the related payments contemplated by Section 4.3(d) hereof.
The date on which an amount set forth on a Final Statement is finally determined
in accordance with this Section 4.3(c) is hereinafter referred to as the
“Determination Date.”

 

(d)           Any amounts determined to be due and owing to Sellers from Buyer
or to Buyer from Sellers, as applicable, pursuant to this Section 4.3 shall be
paid by Sellers to Buyer or by Buyer to Sellers, as applicable, within two
(2) business days after the applicable Determination Date.

 

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Section 4.4             Accounts Receivable; Accounts Payable; Deposits.

 

(a)           Accounts Receivable. After the Closing, Parent and Sellers shall
promptly deliver to Buyer any cash, checks or other property that they or any of
their Affiliates receive to the extent relating to the Accounts Receivable of
the Business included in the Final Closing Net Working Capital. After the
Closing, Buyer shall promptly deliver to Sellers any cash, checks or other
property that Buyer or its Affiliates receive to the extent relating to any
Accounts Receivable existing as of the Closing Date and not included in the
Final Closing Net Working Capital. Neither party nor their Affiliates shall
agree to any settlement, discount or reduction of the Accounts Receivable
belonging to the other party. Neither party nor their Affiliates shall assign,
pledge or grant any security interest in the Accounts Receivable of the other
party.

 

(b)           Accounts Payable. Each party and their Affiliates will promptly
deliver to the other a true copy of any invoice, written notice of accounts
payable or written notice of a dispute as to the amount or terms of any accounts
payable received from the creditor of such accounts payable to the extent such
accounts payable is owed by the other party. Should either party discover it has
paid an accounts payable belonging to the other party, then Buyer or Sellers, as
applicable, shall provide written notice of such payment to the other party and
the other party shall promptly reimburse the party that paid such accounts
payable all amounts listed on such notice.

 

(c)           Customer Deposits. Customer Deposits received by the Company
relating to rooms, services and/or events relating to the period from and after
the Closing shall be retained by the Company at the Closing and included in the
calculation of the Final Closing Net Working Capital. Sellers shall not have
further liability or responsibility after Closing with respect to any Customer
Deposits relating to the period from and after the Closing and Sellers and their
Affiliates shall be entitled to retain Customer Deposits to the extent of rooms
and/or services furnished by Sellers prior to the Closing. “Customer Deposits”
include all security and other deposits, advance or pre-paid rents or other
amounts and key money or deposits (including any interest thereon) and Front
Money.

 

Section 4.5             Corrective Actions. If, after the Closing, Sellers and
Buyer determine that Sellers have transferred to Buyer, directly or indirectly,
any assets or Liabilities that, pursuant to the terms of this Agreement,
constitute Excluded Assets or Excluded Liabilities, or Sellers have retained any
assets or Liabilities that, pursuant to the terms of this Agreement, constitute
Purchased Assets or Assumed Liabilities, then such assets or Liabilities shall
be returned or transferred, as applicable, for no additional payment, and the
other party shall be obliged to accept such return or transfer.

 

Section 4.6             Prorations. The prorations relating to the Purchased
Assets and the ownership and operation of the Business set forth in this
Section 4.6 will be made as of the Closing. The prorations shall be estimated
and prepared by Sellers and included in the Estimated Closing Statement and the
Final Closing Statement delivered to Buyer pursuant to Section 4.1 and
Section 4.3, respectively (in each case to the extent not already reflected in
the Estimated Closing Net Working Capital).

 

(a)           Utility meters will be read, to the extent that the utility
company will do so, during the daylight hours on the Closing Date (or as near as
practicable prior thereto), with

 

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charges to that time paid by Sellers and charges thereafter paid by Buyer.
Prepaid utility charges shall be adjusted on the Estimated Closing Statement and
Final Closing Statement. Charges for utilities which are un-metered, or the
meters for which have not been read on the Closing Date, will be prorated
between Buyer and Sellers as of the Closing. Sellers or Buyer, as appropriate,
shall, upon receipt, submit a copy of the utility billings for any such charges
to the other party and such receiving party shall pay its pro-rata share of such
charges to the submitting party within seven (7) days from the date of any such
submission (to the extent not already reflected in the Estimated Closing Net
Working Capital).

 

(b)           All income and expenses pursuant to the Assumed Contracts will be
prorated between Buyer and Sellers as of the Closing Date on the Estimated
Closing Statement and Final Closing Statement. Sellers shall receive a credit on
the Estimated Closing Statement and Final Closing Statement for (i) the amount
of any prepaid rents related to periods from and after the Closing, and
(ii) security deposits, or other deposits previously paid by Sellers under the
Assumed Contracts, less any such amounts paid to and collected by Sellers under
the Assumed Contracts. Any amounts received by Buyer under the Assumed Contracts
related to any period prior to the Closing shall be promptly paid to Sellers.
Any amounts received by Sellers under the Assumed Contracts related to any
period after the Closing shall be promptly paid to Buyer.

 

Except as otherwise specified in this Section 4.6 or agreed by the parties or
with respect to adjustments to the Purchase Price made pursuant to Section 4.3,
the net amount of all such prorations will be settled and paid on the Closing
Date.

 

ARTICLE V.

CLOSING

 

Section 5.1             Time and Place.

 

(a)           Unless this Agreement is earlier terminated pursuant to ARTICLE XI
hereof, the closing of the transactions contemplated by this Agreement,
including the purchase and sale of the Equity Interests (the “Closing”), shall
take place promptly (but in no event more than five (5) business days) following
the satisfaction or waiver by the applicable party of the conditions set forth
in ARTICLE X hereof (other than those conditions to be satisfied or waived at or
upon the Closing), at such time and place as is agreed to by the parties (the
“Closing Date”), to be effective as of 12:01 a.m. Central Time on the Closing
Date.

 

(b)           Notwithstanding the foregoing:

 

(i)            Sellers may postpone the Closing Date as set forth in
Section 13.2 hereof;

 

(ii)           the Closing Date shall not be later than the date which is six
(6) months after the date of this Agreement (as may be extended pursuant to this
Section 5.1, the “Outside Date”), unless extended by Parent or Buyer, one or
more times, by a two (2) month period by providing the other with a written
notice of an intent to postpone the Closing Date no earlier than ten
(10) business days prior to the then-applicable Outside Date and no later than
five (5) business days prior to the then-applicable Outside Date (any which
extension shall give rise to Buyer’s obligation to pay an Extension Deposit
pursuant to Section 3.2); provided, however,

 

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that in no event shall the Closing Date be later than the date which is twelve
(12) months after the date of this Agreement; and

 

(iii)          notwithstanding anything to the contrary in this Section 5.1(b),
if, at the time of delivery of an extension notice pursuant to
Section 5.1(b)(ii), (x) Buyer has taken, or agreed to or committed to take
(A) any action in breach of Section 9.13, or (B) any action that has materially
delayed, or is reasonably likely to materially delay, the receipt of, or
materially impact the ability of a party to obtain, any Required Governmental
Consent that has not been obtained, or (C) any action that has caused, or is
reasonably likely to cause, any Governmental Entity to commence or re-open a
Proceeding that would reasonably be expected to challenge or prevent the
transactions contemplated by this Agreement or delay the Closing beyond the
Outside Date, then the amount of the Extension Deposit payable by Buyer pursuant
to Section 3.2 in connection with such extension shall be equal to twenty-three
million three-hundred sixty-three thousand dollars ($23,363,000).

 

Section 5.2             Deliveries at Closing. The following documents will be
executed and/or delivered by Buyer, Sellers and/or the Company, as appropriate,
at or prior to the Closing:

 

(a)           Bill of Sale for Personal Property. A Bill of Sale and Assignment
substantially in the form attached as Exhibit A (the “Bill of Sale and
Assignment”), conveying to Sellers (or their designee) all of the Excluded
Assets.

 

(b)           Excluded Liabilities. An Assignment and Assumption Agreement
substantially in the form attached as Exhibit B (the “Assignment and Assumption
Agreement”) to transfer the Excluded Liabilities to Sellers (or their designee),
and Sellers agree to execute and deliver such other assumption agreements or
other documents required by any Person to effectuate the assumption of the
Excluded Liabilities.

 

(c)           FIRPTA Certificate. A duly executed non-foreign person affidavit
of each Seller (or, in the case of a Seller that is a disregarded entity, the
Person treated as the “transferor” with respect to such Seller within the
meaning of Treasury Regulations Section 1.1445-2(b)(2)(iii)) dated as of the
Closing Date, sworn under penalty of perjury and in form and substance required
under the Treasury Regulations issued pursuant to Section 1445 of the Code,
stating that such Seller is not a “foreign person” as defined in Section 1445 of
the Code.

 

(d)           Buyer Certificates. The certificates required by Sections
10.3(a) and (b) hereof.

 

(e)           Sellers Certificates. The certificates required by Sections
10.2(a) and (b) hereof.

 

(f)            Trademark Assignment. The short-form Trademark Assignment
Agreement substantially in the form attached hereto as Exhibit C (the “Trademark
Assignment Agreement”), conveying certain Transferred Intellectual Property from
CLC to the Company.

 

(g)           Equity Interests. An Assignment of Equity Interests substantially
in the form attached as Exhibit F (the “Assignment of Equity Interests”),
conveying to Buyer (or its designee) all of the Equity Interests, and
certificates evidencing the Equity Interests, to the extent the Equity Interests
are certificated.

 

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(h)           Resignations. Resignations, effective as of the Closing Date, of
those officers of the Company as Buyer may request in writing no less than ten
(10) days prior to the Closing Date.

 

(i)            Other Documents. Any other documents, instruments or agreements
which are reasonably requested that are necessary to consummate the transactions
contemplated hereby and have not previously been delivered (including execution
and delivery by Sellers to the Title Insurer of customary affidavits and other
documentation as to matters of title in a form reasonably acceptable to Sellers
and Title Insurer to allow Title Insurer to issue the Endorsement).

 

ARTICLE VI.

REPRESENTATIONS AND WARRANTIES OF PARENT AND SELLERS

 

Parent and Sellers represent and warrant to Buyer that the statements contained
in this ARTICLE VI are true and correct as of the date of this Agreement (except
as to such representations and warranties that address matters as of a
particular date, which are given only as of such date).

 

Section 6.1             Organization of Parent and Sellers. Parent and Sellers
are each duly organized and validly existing under the laws of its state of
organization and has all requisite power and authority to own, lease and operate
its assets and to carry on its business as now being conducted. Parent and
Sellers are each 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, except where the failure to be so qualified, licensed or in
good standing would not, individually or in the aggregate, be reasonably likely
to (x) have a material adverse effect on Parent or Sellers or a Company Material
Adverse Effect or (y) materially impair or materially delay the Closing. Each
Seller is a direct or indirect wholly-owned Subsidiary of Parent.

 

Section 6.2             Authority; No Conflict; Required Filings and Consents.

 

(a)           Parent and each Seller have all requisite power and authority to
enter into this Agreement and each of the Ancillary Agreements to which it is a
party and to consummate the transactions contemplated hereby and thereby.
Parent’s and each Sellers’ execution and delivery of this Agreement and each
Ancillary Agreement to which it is a party and the consummation by Parent and
Sellers of the transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of Parent and Sellers. This
Agreement has been, and each Ancillary Agreement will be at or prior to the
Closing, duly executed and delivered by Parent and Sellers and, assuming the due
authorization, execution and delivery by the other parties hereto and thereto,
this Agreement constitutes, and each Ancillary Agreement when so executed and
delivered will constitute, the valid and binding obligation of Parent and
Sellers, enforceable against Parent and Sellers in accordance with their
respective terms, subject, as to enforcement, to (i) applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws now or hereinafter in
effect affecting creditors’ rights generally and (ii) general principles of
equity.

 

(b)           The execution and delivery by Parent and each Seller of this
Agreement and each Ancillary Agreement to which it is a party does not, and the
consummation by Parent

 

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and Sellers of the transactions contemplated hereby and thereby and the
compliance by Parent and Sellers with any provisions hereof or thereof will not,
(i) conflict with, or result in any violation or breach of, any provision of the
organization documents of Parent or Sellers, (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) under, or require a consent or
waiver under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, lease, Contract or obligation to which Parent or Sellers
are a party or by which Parent or Sellers or the Purchased Assets may be bound,
(iii) result in the creation of any Lien or Encumbrance (other than Permitted
Liens and Permitted Encumbrances) on any of the Purchased Assets pursuant to,
any note, bond, mortgage, indenture, agreement, lease, license, permit,
franchise, instrument, obligation or other Contract to which Parent or Sellers
are a party or by which Parent or Sellers or the Purchased Assets may be bound
or affected, or (iv) subject to the governmental filings and other matters
referred to in Section 7.2(c) hereof, conflict with or violate any permit,
concession, franchise, license, judgment, or Law applicable to Parent or Sellers
or the Purchased Assets, except, in the case of clauses (ii), (iii) and (iv),
for any such breaches, conflicts, violations, defaults, terminations,
cancellations, accelerations, losses or failures to obtain any such consent or
waiver which would not, individually or in the aggregate, be reasonably likely
to (x) have a material adverse effect on Parent or Sellers or a Company Material
Adverse Effect or (y) materially impair or materially delay the Closing.

 

(c)           No consent, approval, finding of suitability, license, permit,
waiver, order or authorization of, or registration, declaration or filing with,
any court, administrative agency, commission, Gaming Authority or other
governmental or regulatory authority or instrumentality (“Governmental Entity”)
is required by or with respect to Parent or Sellers in connection with the
execution and delivery of this Agreement or the Ancillary Agreements by Parent
and Sellers, the compliance by Parent and Sellers with any of the provisions
hereof or thereof, or the consummation by Parent and Sellers of the transactions
to which they are a party that are contemplated hereby, except for (i) the
filing of the notification under, and compliance with any other applicable
requirements of, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder (the “HSR Act”),
(ii) any approvals and filing of notices required under the Gaming Laws,
(iii) such consents, approvals, orders, authorizations, permits, filings,
declarations or registrations related to, or arising out of, compliance with
statutes, rules or regulations regulating the consumption, sale or serving of
alcoholic beverages or tobacco or the renaming or rebranding of the operations
at the Real Property, (iv) such other filings, consents, approvals, findings of
suitability, licenses, waivers, orders, authorizations, permits, registrations
and declarations as may be required under the Laws of any jurisdiction in which
Parent and Sellers conduct any business or own any assets, the failure of which
to make or obtain would not, individually or in the aggregate, be reasonably
likely to have a material adverse effect on Parent or Sellers or a Company
Material Adverse Effect and (v) any consents, approvals, orders, authorizations,
registrations, permits, declaration or filings required by Buyer or any of its
Subsidiaries, Affiliates or key employees (including under the Gaming Laws).

 

Section 6.3             Title to Equity Interests. Sellers are the record and
beneficial owners of all Equity Interests, free and clear of all Liens,
Encumbrances or any other restrictions on transfer other than restrictions on
transfer arising under applicable securities Laws. Sellers are not party to any
option, warrant, purchase right or other Contract (other than this Agreement)

 

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obligating Sellers to sell, transfer, pledge or otherwise dispose of Equity
Interests. Sellers are not a party to any voting trust, proxy or other agreement
or understanding with respect to the Equity Interests.

 

Section 6.4             Litigation. There is no action, suit or proceeding,
claim, arbitration or investigation against Parent or Sellers, pending, or as to
which Parent or Sellers have received any written notice of assertion or which,
to Sellers’ knowledge, have been threatened against, Sellers, the Purchased
Assets, the Real Property or the Business before any Governmental Entity that,
individually or in the aggregate, would be reasonably likely to have a Company
Material Adverse Effect or materially impair or materially delay the Closing.

 

ARTICLE VII.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The Company represents and warrants to Buyer that the statements contained in
this ARTICLE VII are true and correct as of the date of this Agreement and as of
the Closing (except as to such representations and warranties that address
matters as of a particular date, which are given only as of such date), except
as expressly set forth herein and in the corresponding section of the Disclosure
Letter delivered by the Company to Buyer herewith (the “Company Disclosure
Letter”). The Company Disclosure Letter shall be arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in this
Agreement and the disclosure in any paragraph shall, to the extent reasonably
apparent on the face of such disclosure that the matter disclosed is relevant to
another paragraph in this Agreement, qualify such other paragraph.

 

Section 7.1             Organization of the Company; Capitalization. The Company
is duly organized and validly existing under the laws of its state of
organization and has all requisite power and authority to own, lease and operate
its assets and to carry on the Business as now being conducted. The Company 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,
except where the failure to be so qualified, licensed or in good standing would
not, individually or in the aggregate, be reasonably likely to (x) have a
Company Material Adverse Effect or (y) materially impair or materially delay the
Closing. All of the Equity Interests are duly authorized, validly issued, fully
paid and nonassessable and were issued in compliance with all applicable Laws.
No Person has any rights in, or rights to acquire from the Company, any other
equity related interests of the Company or any other securities convertible
into, or exercisable or exchangeable for, equity interests of the Company. There
are no outstanding options, warrants or other securities or subscription,
preemptive or other rights convertible into or exchangeable or exercisable for
any equity or voting interests of the Company and there are no “phantom stock”
rights, stock appreciation rights or other similar rights with respect to the
Company. The Company does not own any direct or indirect equity interest,
participation or voting right in any other Person or any options, warrants,
convertible securities, exchangeable securities, subscription rights, preemptive
rights, rights of first refusal, conversion rights, exchange rights, repurchase
rights, stock appreciation rights, phantom stock, profit participation or other
similar rights in or issued by any other Person.

 

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Section 7.2             Authority; No Conflict; Required Filings and Consents.

 

(a)           The Company has all requisite power and authority to enter into
this Agreement and each of the Ancillary Agreements to which it is a party and
to consummate the transactions contemplated hereby and thereby. The Company’s
execution and delivery of this Agreement and each Ancillary Agreement to which
it is a party and the consummation by the Company of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
action on the part of the Company. This Agreement has been, and each Ancillary
Agreement will be at or prior to Closing, duly executed and delivered by the
Company party thereto and, assuming the due authorization, execution and
delivery by the other parties hereto and thereto, this Agreement constitutes,
and each Ancillary Agreement when so executed and delivered will constitute, the
valid and binding obligation of the Company, enforceable against the Company in
accordance with their respective terms, subject, as to enforcement, to
(i) applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws now or hereinafter in effect affecting creditors’ rights generally and
(ii) general principles of equity.

 

(b)           The execution and delivery by the Company of this Agreement and
each Ancillary Agreement to which it is a party, the consummation by the Company
of the transactions contemplated hereby and thereby, and the compliance of the
Company with any provisions hereof or thereof, does not or will not,
(i) conflict with, or result in any violation or breach of, any provision of the
organization documents of the Company, (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) under, or require a consent or
waiver under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, lease, Contract or obligation to which the Company is a
party or by which the Company or the Purchased Assets may be bound, (iii) result
in the creation of any Lien or Encumbrance (other than Permitted Liens and
Permitted Encumbrances) on any of the Purchased Assets pursuant to, any note,
bond, mortgage, indenture, agreement, lease, license, permit, franchise,
instrument, obligation or other Contract to which the Company is a party or by
which the Company or the Purchased Assets may be bound or affected, or
(iv) subject to the governmental filings and other matters referred to in
Section 7.2(c) hereof, conflict with or violate any permit, concession,
franchise, license, judgment, or Law applicable to the Company or the Purchased
Assets, except, in the case of clauses (ii), (iii) and (iv), for any such
breaches, conflicts, violations, defaults, terminations, cancellations,
accelerations, losses or failures to obtain any such consent or waiver which
would not, individually or in the aggregate, be reasonably likely to (x) have a
Company Material Adverse Effect or (y) materially impair or materially delay the
Closing.

 

(c)           No consent, approval, finding of suitability, license, permit,
waiver, order or authorization of, or registration, declaration or filing with,
any Governmental Entity is required by or with respect to the Company in
connection with the execution and delivery of this Agreement or the Ancillary
Agreements by the Company or the consummation by the Company of the transactions
to which it is a party that are contemplated hereby, except for (i) the filing
of the notification under, and compliance with any other applicable requirements
of, the HSR Act, (ii) any approvals and filing of notices required under the
Gaming Laws, (iii) such consents, approvals, orders, authorizations, permits,
filings, declarations or registrations related to, or arising out of, compliance
with statutes, rules or regulations regulating the consumption, sale or serving
of alcoholic beverages or tobacco or the renaming or rebranding of the
operations at the Real Property, (iv) such other filings, consents, approvals,
findings of suitability, licenses, waivers, orders, authorizations, permits,
registrations and declarations as may be required under

 

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the Laws of any jurisdiction in which the Company conducts any business or owns
any Purchased Assets, the failure of which to make or obtain would not,
individually or in the aggregate, be reasonably likely to (x) have a Company
Material Adverse Effect or (y) materially impair or materially delay the
Closing, and (v) any consents, approvals, orders, authorizations, registrations,
permits, declaration or filings required by Buyer or any of its Subsidiaries,
Affiliates or key employees (including under the Gaming Laws).

 

Section 7.3             Financial Statements.

 

(a)           Section 7.3 of the Company Disclosure Letter contains a true and
complete copy of the audited financial statements of the Company for the twelve
(12) months ended December 31, 2011 and December 31, 2010 (the “Financial
Information”). Except as noted therein, the Financial Information was prepared
in accordance with GAAP in effect at the time of such preparation applied on a
consistent basis throughout the periods involved and fairly presents in all
material respects the financial position and results of operations of the
Business as of such date and the results of the Business for such period. No
representation or warranty is made that Buyer will be able to operate the
Business for the costs reflected in the Financial Information.

 

(b)           The Company has devised and maintained systems of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or
specific authorization, (ii) transactions are recorded as necessary to permit
the preparation of the Financial Information in conformity with GAAP, to the
extent applicable, or the Company’s internal accounting principles and to
maintain proper accountability for items, (iii) access to its property and
assets is permitted only in accordance with management’s general or specific
authorization and (iv) the recorded accountability for items is compared with
the actual levels at reasonable intervals and appropriate action is taken with
respect to any differences.

 

(c)           The Financial Information was prepared from the books and records
of the Company, which (i) have been maintained in material compliance with
applicable legal and accounting requirements and reasonable business practices,
(ii) are in all material respects complete and correct and fairly reflect, in
all material respects, all dealings and transactions in respect of the Business
and the assets and liabilities thereof, and (iii) represent the financial
information which is included in the consolidated audited financial statements
of Parent.

 

Section 7.4             No Undisclosed Liabilities. Except (i) as set forth in
the Financial Information, (ii) for Excluded Liabilities and (iii) for
Liabilities incurred since December 31, 2011 in the Ordinary Course of Business,
the Company has no Liabilities which would, individually or in the aggregate,
reasonably be expected to cause a Company Material Adverse Effect.

 

Section 7.5             Taxes.

 

(a)           Except as would not, individually or in the aggregate, reasonably
be expected to cause a Company Material Adverse Effect, the Company has timely
filed with the appropriate Governmental Entities all Tax Returns required to be
filed by the Company and all such Tax Returns are true, complete and accurate.
The Company has timely paid all Taxes due from the Company whether or not shown
on such Tax Returns or the Company has established an adequate reserve therefor
in the Financial Information in accordance with GAAP, except as

 

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would not, individually or in the aggregate, reasonably be expected to cause a
Company Material Adverse Effect.

 

(b)           Other than as set forth on Section 7.5(b)(i) of the Company
Disclosure Letter , there are no claims, actions, audits or other proceedings
with any Governmental Entities are presently ongoing or pending or threatened in
writing in respect of any material Taxes of the Company. There are no
outstanding waivers extending the statutory period of limitation relating to
Taxes of the Company. Schedule 7.5(b)(ii) of the Company Disclosure Letter lists
each agreement with any Governmental Entity with respect to any material Tax
holiday or other material Tax incentive currently in effect with respect to the
Company or the Purchased Assets, and Sellers have delivered or made available to
Buyer a copy of any such agreement with the relevant Governmental Entity.

 

(c)           There are no Liens for Taxes (other than Permitted Liens) on the
Company or any Purchased Assets, except as which would not, individually or in
the aggregate, reasonably be expected to cause a Company Material Adverse
Effect. None of the Purchased Assets are required to be treated for Tax purposes
as owned by a Person other than the Company. Except as would not, individually
or in the aggregate, reasonably be expected to cause a Company Material Adverse
Effect, (i) the Company has complied in all respects with all Laws relating to
the payment and withholding of Taxes, including with respect to payments made to
employees, independent contractors, shareholders or other Persons, and (ii) all
Persons classified by the Company as independent contractors are correctly
classified for Tax purposes.

 

(d)           The Company is not a party to or bound by any Tax sharing, Tax
indemnity, or Tax allocation agreement other than any such agreements that are
customary ordinary course commercial contracts not primarily related to Taxes.
No “closing agreements” described in Section 7121 of the Code (or any comparable
provision of state, local or foreign Law) have been entered into by or with
respect to the Company and no Tax ruling has been requested or received by or
with respect to the Company, in each case, that (x) would bind Buyer or any of
its Affiliates (including the Company) after the Closing and (y) would have, or
reasonably be expected to have, a material effect on the Purchased Assets, the
Business, Buyer, any Affiliate of Buyer or the Company after the Closing.

 

(e)           The Company has not entered into any “listed transaction” within
the meaning of Treasury Regulations Section 1.6011-4(b)(2). Neither Buyer nor
the Company will be required to include any material item of income in, or
exclude any material item of deduction from, taxable income for any Post-Closing
Period as a result of any (i) adjustment required by reason of a change in
method of accounting for a Pre-Closing Period under Section 481(c) of the Code
(or any corresponding or similar provision of state, local or foreign Law), or
(ii) installment sale or intercompany transaction made prior to the Closing.

 

(f)            The Company has not distributed the capital stock of any
corporation in a transaction intended to qualify under Section 355 of the Code
within the past two years prior to the date of this Agreement, nor has the
Company been distributed in a transaction intended to qualify under Section 355
of the Code within the past two years prior to the date of this Agreement. The
Company is and since 2002 has been classified as a partnership for federal
income tax purposes, and during this period neither the Company nor any of its
Affiliates has received any written notice from any Governmental Entity
challenging such classification and no

 

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Affiliate has taken a position inconsistent with such classification. Since 2002
and, to the knowledge of the Company, from the formation of the Company to 2002,
the Company has never been a member of any consolidated, combined, unitary or
affiliated Tax Return group. The Company does not own stock or other equity
interests, for tax purposes or otherwise, in any corporation, partnership or
other entity.

 

Section 7.6             Real Property.

 

(a)           All Real Property owned by the Company is described on
Section 7.6(a) of the Company Disclosure Letter (the “Owned Real Property”). The
Company has valid and insurable (at ordinary rates) fee simple title to the
Owned Real Property subject, in each case, to all Permitted Liens and Permitted
Encumbrances.

 

(b)           The Company does not lease any Real Property.

 

(c)           There are no actions, proceedings, governmental investigations,
arbitrations, unsatisfied orders or judgments, actions, litigation, suits, or
other proceedings, pending (or, to the Company’s knowledge, overtly contemplated
or threatened) against the Company or otherwise relating to the Real Property or
the interests of the Company therein, which would be reasonably likely to
interfere with the use, ownership, improvement, development and/or operation of
the Real Property; in each case except for such actions, proceedings or
litigation, which, individually or in the aggregate, would not be reasonably
likely to (x) have a Company Material Adverse Effect or (y) materially impair or
materially delay the Closing.

 

(d)           There are no pending condemnation, eminent domain, or similar
proceedings or actions pending or, to the Company’s knowledge, threatened with
regard to the Real Property.

 

(e)           There are no violations or alleged violations of any Laws with
respect to the Real Property, including but not limited to zoning and the
Americans with Disabilities Act matters which would, individually or in the
aggregate, be reasonably likely to (x) have a Company Material Adverse Effect or
(y) materially impair or materially delay the Closing. To the Company’s
knowledge, there are no material inquiries, complaints, proceedings or
investigations (excluding routine, periodic inspections) pending regarding
compliance of the Real Property with any such Laws.

 

(f)            To the Company’s knowledge, all material Improvements located on,
under, over or within the Real Property (including chillers and elevators), and
all other aspects of each parcel of Real Property, are in good operating
condition and repair and are structurally sound and free of any material
defects.

 

(g)           The Company has not filed notices of protest or appeal against, or
commenced proceedings to recover, real property tax assessments against any of
the Real Property.

 

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Section 7.7             Intellectual Property.

 

(a)           Section 7.7(a)(1) of the Company Disclosure Letter lists all of
the trademark and service mark registrations and applications owned by the
Company and Caesars License Company, LLC, an indirect wholly-owned subsidiary of
Parent (“CLC”) as of the date hereof and used exclusively in connection with the
operation of the Business, and all of the Internet domain names registered by or
for the benefit of the Company or CLC and used exclusively in the Business
(collectively, the “Transferred Marks and Domain Names”), which Transferred
Marks and Domain Names will be owned by the Company at the Closing.
Section 7.7(a)(2) of the Company Disclosure Letter lists all issued patents or
patent applications or any registered copyrights that are owned by the Company
and used exclusively in the Business (“Other Transferred Registered IP”). To the
Company’s knowledge, no Transferred Marks and Domain Names or Other Transferred
Registered IP are now involved in any opposition or cancellation proceeding and,
to the Company’s knowledge, no such proceeding is or has been threatened in
writing with respect thereto. To the Company’s knowledge, all Transferred Marks
and Domain Names and Other Transferred Registered IP are subsisting, valid and
enforceable, and no abandonment, cancellation, or forfeiture of any of the
Transferred Marks and Domain Names or Other Transferred Registered IP is pending
or threatened in writing. To the Company’s knowledge, neither the Company nor
any of its Affiliates have received any written notice or claim challenging the
validity or enforceability of any Transferred Marks and Domain Names or Other
Transferred Registered IP that remains pending or unresolved as of the date
hereof.

 

(b)           Except as set forth on Section 7.7(b) of the Company Disclosure
Letter, the Company and CLC own exclusively, free and clear of all Liens (except
for any Permitted Liens), all Transferred Intellectual Property. Neither the
Company nor any of its Affiliates has received any written notice or claim
challenging the Company’s or CLC’s ownership of any Transferred Intellectual
Property, in each case that remains pending or unresolved as of the date hereof.
To the Company’s knowledge, as of the date hereof the Company and CLC own or
possess, and at the Closing the Company will own or possess, adequate and
enforceable rights to use all Transferred Intellectual Property or Intellectual
Property licensed to the Company or CLC, as applicable, pursuant to an Assumed
Contract that is used in connection with the Business, as currently operated,
without material restrictions or material conditions on use (except as set forth
in the Assumed Contracts).

 

(c)           To the Company’s knowledge, the Business, including the operation
of the Casino and the use of any of the Transferred Intellectual Property in
connection therewith, has not infringed upon, misappropriated or violated, and
do not infringe upon, misappropriate or violate, any Intellectual Property of
any third party, in each case, in any material respect. Neither the Company nor
any of its Affiliates has received any written notice or claim asserting that
any such infringement, misappropriation, or violation is or may be occurring or
has or may have occurred that remains pending or unresolved. To the Company’s
knowledge, no third party is misappropriating, infringing, or violating in a
material manner any Transferred Intellectual Property.

 

Section 7.8             Agreements, Contracts and Commitments. (i) Each Assumed
Contract is valid and binding upon the Company (and, to the Company’s knowledge,
on all other parties thereto), in accordance with its terms and is in full force
and effect, (ii) there is no breach or violation of or default by the Company
or, to the Company’s knowledge, by any other party under any of the Assumed
Contracts, whether or not such breach, violation or default has been

 

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waived, and (iii) no event has occurred with respect to the Company or, to the
Company’s knowledge, any other party, which, with notice or lapse of time or
both, would constitute a breach, violation or default of, or give rise to a
right of termination, modification, cancellation, foreclosure, imposition of a
Lien, prepayment or acceleration under, any of the Assumed Contracts, which
breach, violation, default, termination, modification, cancellation,
foreclosure, imposition of a Lien, prepayment or acceleration referred to in
clause (ii) or (iii) would, individually or in the aggregate, be reasonably
likely to (x) have a Company Material Adverse Effect or (y) materially impair or
materially delay the Closing. None of Sellers, the Company or any of their
Affiliates has received any written notice (or, to the knowledge of the Company,
any oral or other notice) of the intention of any Person to terminate, nor has
there been any termination of, any Assumed Contract. The Company has made
available to Buyer a true, correct and complete copy of all material Assumed
Contracts, together with all amendments, waivers or other changes thereto.

 

Section 7.9             Litigation. Other than as set forth on Section 7.9 of
the Company Disclosure Letter, there is no action, suit or proceeding, claim,
arbitration or investigation against the Company, pending, or as to which the
Company has received any written notice of assertion or, to the Company’s
knowledge, threatened against, the Company, the Purchased Assets, the Real
Property or the Business before any Governmental Entity, that, individually or
in the aggregate, would be reasonably likely to (x) have a Company Material
Adverse Effect or (y) materially impair or materially delay the Closing. The
Company, the Purchased Assets, the Real Property and the Business are not
subject to any judgment, decree, injunction, rule or order of any Governmental
Entity or any arbitrator that individually or in the aggregate materially
interfere with, or would reasonably be expected to materially interfere with,
the ability of the Business to be conducted as it is currently conducted or to
utilize its properties, assets and rights as currently utilized.

 

Section 7.10           Environmental Matters. Except as have not had and would
not, individually or in the aggregate, be reasonably likely to have a Company
Material Adverse Effect, (a) there are no Environmental Liabilities, (b) there
are no Environmental Conditions, (c) there is no pending or, to the Company’s
knowledge, threatened enforcement action regarding an Environmental Condition or
compliance with Environmental Laws with respect to the Real Property or the
Business, (d) no Hazardous Substance is located on the Real Property, except for
amounts permitted by Environmental Laws as used in the Ordinary Course of
Business of the Casino (e) in the past three (3) years the Company has not
received a written notice from any Governmental Entity or third party alleging a
violation of any Environmental Law and (f) the Company is in compliance with all
applicable Environmental Laws. The Company possesses all licenses, permits,
certificates, registrations, approvals, authorizations and consents from any
Governmental Entity required under Environmental Laws with respect to operation
of the Business. As promptly as reasonably practicable, and in any event within
thirty (30) days of the Effective Date, the Company will provide Buyer with true
and complete copies of (i) all licenses, permits, certificates, registrations,
approvals, authorizations and consents from any Governmental Entity issued to
the Company under Environmental Laws (“Environmental Authorizations”) and
(ii) all written notices received by the Company from any Governmental Entity or
third party alleging a violation of any Environmental Law that are, in each
case, in the Company’s possession, custody or control.

 

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Section 7.11           Permits; Compliance with Laws.

 

(a)           The Company and, to the Company’s knowledge, each of the Company’s
directors, officers, key employees and Persons performing management functions
similar to officers and partners hold all permits, registrations, findings of
suitability, licenses, variances, exemptions, certificates of occupancy, orders
and approvals of all Governmental Entities (including all authorizations under
Gaming Laws) necessary to conduct the Business (the “Company Permits”), each of
which is in full force and effect, except for such Company Permits the failure
of which to hold would not, individually or in the aggregate, be reasonably
likely to (x) have a Company Material Adverse Effect or (y) materially impair or
materially delay the Closing, and no event has occurred which permits, or upon
the giving of notice or passage of time or both, would permit, revocation,
non-renewal, modification, suspension, limitation or termination of any of the
Company Permits that are currently in effect, the loss of which would,
individually or in the aggregate, be reasonably likely to (x) have a Company
Material Adverse Effect or (y) materially impair or materially delay the
Closing. All Company Permits that are material to the Business, and all permits
of the Company that are pending but not yet issued, are listed in
Section 7.11(a) of the Company Disclosure Letter. The Company and, to the
Company’s knowledge, the Company’s directors, officers, key employees and
Persons performing management functions similar to officers and partners, are,
and since January 1, 2009 have been, in compliance with the terms of the Company
Permits, except for such failures to comply as would not, individually or in the
aggregate, be reasonably likely to (x) have a Company Material Adverse Effect or
(y) materially impair or materially delay the Closing. The Business is, and
since January 1, 2009 has been, conducted in accordance with applicable Law
(including the Gaming Laws), except for such noncompliance which, individually
or in the aggregate, does not have and would not be reasonably likely to
(x) have a Company Material Adverse Effect or (y) materially impair or
materially delay the Closing. The Company has not received notice of any
investigation or review by any Governmental Entity with respect to the Real
Property, the Business, the other Purchased Assets or the Assumed Liabilities
that is pending, and, to the Company’s knowledge, no investigation or review is
threatened, nor has any Governmental Entity indicated any intention to conduct
the same, other than those the outcome of which would not, individually or in
the aggregate, be reasonably likely to (x) have a Company Material Adverse
Effect or (y) materially impair or materially delay the Closing.

 

(b)           Neither the Company nor, to the Company’s knowledge, any of the
Company’s directors, officers, key employees or partners or Persons performing
management functions similar to officers or partners have received any written
claim, demand, notice, complaint, court order or administrative order from any
Governmental Entity in the past three (3) years under, or relating to any
violation or possible violation of any Gaming Laws in connection with or related
to the Business which resulted in or would be reasonably likely to result in any
material fine or penalty. To the Company’s knowledge, there are no facts, which
if known to the regulators under the Gaming Laws would be reasonably likely to
result in the revocation, limitation or suspension of a license, finding of
suitability, registration, permit or approval of the Company or any of its
officers, directors, key employees or Persons performing management functions
similar to an officer or partner, or limited partner under any Gaming Laws, in
each case in connection with or related to the Business.

 

Section 7.12           Labor Matters.

 

(a)           Each Property Employee who is not a Reserved Employee is employed
by the Company or a Subsidiary thereof, and no Reserved Employee is employed by
the Company or a

 

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Subsidiary thereof. As promptly as reasonably practicable, and in any event
within thirty (30) days of the Effective Date, Sellers will provide Buyer with
an accurate and complete list of each Property Employee as of the date of such
list stating each such individual’s (i) date of commencement of employment,
(ii) current position, (iii) business location, (iv) annual/weekly/hourly rates
of compensation, (v) actual and target incentive and discretionary bonus amounts
for the 2011 and 2012 calendar years, (vi) status as full or part time,
(vii) accrued vacation and (viii) credited service under the Company Benefit
Plans (such list to be updated periodically between the date hereof and the
Closing Date upon the reasonable request of Buyer to reflect new hires,
transfers and terminations not inconsistent with Section 9.1(t)).

 

(b)           The Company is not and has not been a party to or is, bound by, or
otherwise obligated with respect to, any collective bargaining agreement, labor
union contract, trade union agreement or foreign works council contract (any
such arrangement, a “Labor Agreement”). There are no unfair labor practice
charges, complaints or petitions for elections pending against the Company
before the National Labor Relations Board, or any similar Governmental Entity,
or of which the Company has received notice. There is no strike, slowdown, work
stoppage or lockout, or, to the Company’s knowledge, threat thereof, by or with
respect to any Property Employees, and no such strike, slowdown, work stoppage,
lockout, or, to the Company’s knowledge, threat thereof, by or with respect to
any Property Employees has occurred in the past five years. To the Company’s
knowledge, there have been no activities or proceedings of any labor union to
try to organize any non-unionized Property Employees during the last five years,
and there are no petitions for elections pending against the Company before the
National Labor Relations Board or any similar Governmental Entity or of which
the Company or its Affiliates have received notice.

 

Section 7.13           Employee Benefits.

 

(a)           Section 7.13(a) of the Company Disclosure Letter sets forth an
accurate and complete list of all (i) “employee welfare benefit plans,” within
the meaning of Section 3(1) of the Employee Retirement Income Security Act of
1974, as amended, and the rules and regulations thereunder (“ERISA”);
(ii) “employee pension benefit plans,” within the meaning of Section 3(2) of
ERISA; and (iii) material bonus, stock option, stock purchase, restricted stock,
incentive, fringe benefit, profit-sharing, pension or retirement, deferred
compensation, medical, life insurance, disability, accident, salary
continuation, employment, consulting, change-in-control, retention, severance,
accrued leave, vacation, sick pay, sick leave, supplemental retirement,
unemployment and any other compensation or benefit plans, programs, agreements,
arrangements, commitments and/or practices (whether or not insured) for
employees of Sellers and their Subsidiaries who are located at the Real Property
or perform services exclusively related to the Business (the “Property
Employees”), other than the Reserved Employees (all of the foregoing plans,
programs, arrangements, commitments, practices and Contracts referred to in (i),
(ii) and (iii) above are referred to as the “Company Benefit Plans”). The
Company does not sponsor, maintain, or otherwise have any obligations with
respect to, nor has the Company ever sponsored, maintained, or otherwise had any
obligation with respect to, any employee benefit plan, program, agreement,
arrangement, commitment, practice or Contract (other than any such plan,
program, agreement, arrangement, commitment, practice or Contract maintained by
Sellers (or any Affiliate of Sellers other than the Company) with respect to
which (x) the

 

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Company is a sponsor or contributor as a participating employer but (y) Buyer
and its Affiliates (including, following the Closing, the Company) shall have no
responsibility or Liability).

 

(b)           True and complete copies of each of the following documents (or
accurate summaries thereof) have been made available to Buyer: (i) Company
Benefit Plans, including with respect to any Company Benefit Plan that is not in
writing, a written description of the material terms thereof and (ii) with
respect to any Company Benefit Plan, (A) any related trust agreement, or
insurance contract or documents relating to other funding arrangements, (B) for
the three (3) most recently ended plan years, all IRS Form 5500s (and any
financial statements and other schedules attached thereto), (C) all current
summary plan descriptions and subsequent summaries of material modifications to
the extent required under ERISA, (D) a current IRS determination or opinion
letter that is intended to be qualified under Section 401(a) of the Code if
applicable; and (E) the most recent financial and actuarial valuation reports if
applicable.

 

(c)           Except as disclosed in Section 7.13(c) of the Company Disclosure
Letter, (i) each Company Benefit Plan that is intended to qualify under
Section 401(a) of the Code has either received a favorable determination or
opinion letter from the IRS as to its qualified status or, if the remedial
amendment period for such Company Benefit Plan has not yet expired, all
amendments to such Company Benefit Plan that are required by the IRS through the
date hereof have been adopted on a timely basis, and each trust established in
connection with any Company Benefit Plan that is intended to be exempt from
federal income taxation under Section 501(a) of the Code is so exempt, and no
fact or event has occurred that could affect adversely the qualified status of
any such Company Benefit Plan or the exempt status of any such trust; (ii) there
has been no prohibited transaction (within the meaning of Section 406 of ERISA
or Section 4975 of the Code, other than a transaction that is exempt under a
statutory or administrative exemption) with respect to any Company Benefit Plan
with respect to which the Company would be reasonably expected to have any
liability; (iii) no action or other administrative proceeding has been brought,
or to the Company’s knowledge, is threatened, against or with respect to any
such Company Benefit Plan, including but not limited by any Property Employee
(other than routine benefits claims), any audit or inquiry by the IRS or United
States Department of Labor (“DOL”), or any termination or similar proceeding by
the DOL or the Pension Benefit Guaranty Corporation with respect to which the
Company is reasonably expected to have any liability; and (iv) no Company
Benefit Plan is a multiemployer pension plan (as defined in Section 3(37) of
ERISA) (“Multiemployer Plan”), multiple employer plan (within the meaning of
Section 4063 or 4064 of ERISA or Section 413(c) of the Code) (“Multiple Employer
Plan”) or other pension plan subject to Title IV of ERISA or Section 412 of the
Code. There does not now exist, nor do any circumstances exist that could result
in, any Controlled Group Liability that would be a Liability of the Company
following the Closing.

 

(d)           No Company Benefit Plan that is a “welfare benefit plan” within
the meaning of Section 3(1) of ERISA provides retiree or post-employment
benefits to any Property Employees or to the employees of the Company’s ERISA
Affiliates, other than pursuant to Section 4980B of the Code or any similar
state Law. The Company and its ERISA Affiliates have complied in all material
respects with the provisions of Part 6 of Title I of ERISA and Sections 4980B,
9801, 9802, 9811 and 9812 of the Code with respect to the Property Employees.

 

(e)           Each Company Benefit Plan and each employment agreement that is
being assumed by Buyer pursuant to this Agreement that is a “nonqualified
deferred compensation

 

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plan” (within the meaning of Section 409A(d)(1) of the Code) is, and has in the
past been maintained, in material compliance with Section 409A of the Code.

 

(f)            Neither the execution or delivery of this Agreement nor the
consummation of the transactions contemplated by this Agreement will, either
alone or in conjunction with any other event, (i) result in any payment or
benefit becoming due or payable, or required to be provided, to any director,
employee or independent contractor of the Company, (ii) increase the amount or
value of any benefit or compensation otherwise payable or required to be
provided to any such director, employee or independent contractor, (iii) result
in the acceleration of the time of payment, vesting or funding of any such
benefit or compensation, (iv) result in any “excess parachute payment” within
the meaning of Section 280G(b)(1) of the Code or (v) or result in any limitation
on the right of the Company to amend, merge, terminate or receive a reversion of
assets from any Company Benefit Plan or related trust.

 

Section 7.14           Brokers. Except for the fees and commissions of Deutsche
Bank Securities Inc. (which fees and commissions are the sole responsibility of
Sellers), the Company has not employed and no Person has acted directly or
indirectly as a broker, financial advisor or finder for the Company or incurred
any Liability for any brokerage fees, commissions or finder’s fees in connection
with the transactions contemplated by this Agreement.

 

Section 7.15           Title to Purchased Assets. The Company has good and
marketable title to, or a valid leasehold interest in, the tangible personal
property constituting Purchased Assets, free and clear of any Encumbrances or
Liens other than for Permitted Encumbrances and Permitted Liens.

 

Section 7.16           Affiliate Transactions. There are no transactions,
Contracts or other obligations between the Company, on the one hand, and any
officer, director or Affiliate of the Company, on the other, that will
constitute an Assumed Liability or that will otherwise continue after Closing.

 

Section 7.17           Minimum Cash. As of the Closing, the Business will have
an amount of House Funds at least equal to the minimum bankroll required by
applicable Gaming Laws, if any.

 

Section 7.18           Vendors. As promptly as reasonably practicable, and in
any event within thirty (30) days of the Effective Date, Sellers will provide
Buyer with a list of the vendors of the Business as of the date of such list,
including the product or service provided by, and the principal contact
information for, each such vendor.

 

Section 7.19           Absence of Changes. Since December 31, 2011, the Business
has been conducted in the Ordinary Course of Business, and there has not been
any event, occurrence, state of circumstances or facts or change that has had or
that would be reasonably expected, individually or in the aggregate (x) to have
a Company Material Adverse Effect or (y) to materially impair or materially
delay the Closing.

 

Section 7.20           Insurance Coverage. Sellers and the Company maintain
adequate insurance coverage in accordance with reasonable commercial standards,
including material insurance policies and fidelity bonds and self-insurance
programs, in each case in respect of the

 

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Purchased Assets, the Real Property and the business and operations of the
Business and its employees (collectively, the “Insurance Policies”).

 

ARTICLE VIII.

REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer represents and warrants to Sellers that the statements contained in this
ARTICLE VIII are true and correct as of the this Agreement and as of the Closing
(except as to such representations and warranties that address matters as of a
particular date, which are given only as of such date), except as expressly set
forth herein and in the corresponding section of the Disclosure Letter delivered
by Buyer to Sellers herewith (the “Buyer Disclosure Letter”). The Buyer
Disclosure Letter shall be arranged in paragraphs corresponding to the numbered
and lettered paragraphs contained in this Agreement and the disclosure in any
paragraph shall, to the extent reasonably apparent on the face of such
disclosure that the matter disclosed is relevant to another paragraph in this
Agreement, qualify such other paragraph..

 

Section 8.1             Organization. Buyer is duly organized, validly existing
and in good standing under the laws of its state of organization and has all
requisite corporate power and authority to carry on its business as now being
conducted. Buyer 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, except where the failure to be so qualified, licensed or in
good standing would not, individually or in the aggregate, be reasonably likely
to have a Buyer Material Adverse Effect.

 

Section 8.2             Authority; No Conflict; Required Filings and Consents.

 

(a)           Buyer has all requisite corporate power and authority to enter
into this Agreement and each of the Ancillary Agreements to which it is a party
and to consummate the transactions contemplated hereby and thereby. Buyer’s
execution and delivery of this Agreement and each of the Ancillary Agreements to
which it is a party and the consummation by Buyer of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
action on the part of Buyer. This Agreement has been, and each Ancillary
Agreement will be at or prior to the Closing, duly executed and delivered by
Buyer and, assuming the due authorization, execution and delivery of the other
partiers hereto, this Agreement constitutes, and each Ancillary Agreement when
so executed and delivered will constitute, the valid and binding obligation of
Buyer, enforceable against Buyer in accordance with their respective terms,
subject, as to enforcement, to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws now or hereinafter in effect
affecting creditors’ rights generally and (ii) general principles of equity.

 

(b)           The execution and delivery by Buyer of this Agreement and each
Ancillary Agreement to which it is a party does not, and the consummation by
Buyer of the transactions contemplated hereby and thereby and the compliance by
Buyer with any provisions hereof or thereof will not, (i) conflict with, or
result in any violation or breach of, any provision of the organizational
documents of Buyer, (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) under, or require a consent or waiver under, any of the
terms, conditions or provisions of any note, bond, mortgage,

 

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indenture, lease, Contract or obligation to which Buyer is a party or by which
Buyer or any of its properties or assets may be bound, or (iii) subject to the
governmental filings and other matters referred to in Section 8.2(c) hereof,
conflict with or violate any permit, concession, franchise, license, judgment,
or Law applicable to Buyer or any of its properties or the assets, except, in
the case of clauses (ii) and (iii), for any such breaches, conflicts,
violations, defaults, terminations, cancellations, accelerations, losses or
failures to obtain any consent or waiver which would not, individually or in the
aggregate, be reasonably likely to (x) have a Buyer Material Adverse Effect or
(y) materially impair or materially delay the Closing.

 

(c)           No consent, approval, finding of suitability, license, permit,
waiver, order or authorization of, or registration, declaration or filing with,
any Governmental Entity is required by or with respect to Buyer or its
Affiliates in connection with the execution and delivery of this Agreement or
the Ancillary Agreements by Buyer, the compliance by Sellers with any of the
provisions hereof or thereof, or the consummation by Buyer of the transactions
that are contemplated hereby, except for (i) the filing of the notification
report under, and compliance with any other applicable requirements of, the HSR
Act, (ii) any approvals and filing of notices required under the Gaming Laws,
(iii) such consents, approvals, orders, authorizations, permits, filings,
declarations or registrations related to, or arising out of, compliance with
statutes, rules or regulations regulating the consumption, sale or serving of
alcoholic beverages or tobacco or the renaming or rebranding of the operations
at the Real Property, (iv) such other filings, consents, approvals, findings of
suitability, licenses, waivers, orders, authorizations, permits, registrations
and declarations as may be required under the Laws of any jurisdiction in which
Buyer conducts any business or owns any assets, the failure of which to make or
obtain would not, individually or in the aggregate, be reasonably likely to
(x) have a Buyer Material Adverse Effect or (y) materially impair or materially
delay the Closing and (v) any consents, approvals, orders, authorizations,
registrations, permits, declaration or filings required by Parent, Sellers or
the Company or any of their Subsidiaries, Affiliates or key employees (including
under the Gaming Laws).

 

Section 8.3             Brokers. Neither Buyer nor any of its Representatives
have employed, and no Person has acted directly or indirectly as a broker,
financial advisor or finder for Buyer or incurred any Liability for any
brokerage fees, commissions or finder’s fees in connection with the transactions
contemplated by this Agreement.

 

Section 8.4             Financing. Buyer will have available at the Closing
sufficient funds to enable Buyer to pay (x) the sum of the Purchase Price, the
Estimated Closing Payment and the Estimated Operations Payment and (y) the Final
Closing Payment and the Final Operations Payment, in each case pursuant to
Section 4.2 hereof.

 

Section 8.5             Licensability of Principals. Except as set forth in
Section 8.5 of the Buyer Disclosure Letter, neither Buyer nor any of its current
Representatives or Affiliates (collectively the “Buyer Related Parties”) has
ever withdrawn, been denied, or had revoked, a gaming license or related finding
of suitability by a Governmental Entity or Gaming Authority within the last five
(5) years. Buyer and each of the Buyer Related Parties are in good standing in
each of the jurisdictions in which Buyer or any Buyer Related Party owns or
operates gaming facilities. To Buyer’s knowledge, as of the date hereof, there
are no facts, which if known to the Gaming Authorities would (a) be reasonably
likely to result in the denial, revocation, limitation or suspension of a gaming
license currently held or other Gaming Approval, or (b) result in a

 

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negative outcome to any finding of suitability proceedings currently pending, or
under the suitability proceedings necessary for the consummation of this
Agreement. Buyer is not aware of any material investigations of it or any of its
subsidiaries operating in Missouri which investigations could result in
revocation of or material discipline related to its Class A License.

 

Section 8.6             Permits; Compliance with Gaming Laws.

 

(a)           Buyer, and to its knowledge, each of its Affiliates, directors,
officers, key employees and Persons performing management functions similar to
officers and partners holds all permits, registrations, findings of suitability,
licenses, variances, exemptions, certificates of occupancy, orders and approvals
of all Governmental Entities (including all authorizations under Gaming Laws)
necessary to conduct the business and operations of Buyer (the “Buyer Permits”),
each of which is in full force and effect except for such Buyer Permits, the
failure of which to hold would not, individually or in the aggregate, be
reasonably likely to (x) have a Buyer Material Adverse Effect or (y) materially
impair or materially delay the Closing, and no event has occurred which permits,
or upon the giving of notice or passage of time or both would permit,
revocation, non-renewal, modification, suspension, limitation or termination of
the Buyer Permits that are currently in effect, the loss of which would,
individually or in the aggregate, be reasonably likely to (x) have a Buyer
Material Adverse Effect or (y) materially impair or materially delay the
Closing. Buyer, and to Buyer’s knowledge, Buyer’s directors, officers, key
employees and Persons performing management functions similar to officers and
partners are, and since January 1, 2009 have been, in compliance with the terms
of the Buyer Permits, except for such failures to comply, as would not,
individually or in the aggregate, be reasonably likely to (x) have a Buyer
Material Adverse Effect (y) materially impair or materially delay the Closing.
Buyer has not received notice of any investigation or review by any Governmental
Entity with respect to Buyer that is pending, and, no investigation or review is
threatened, nor has any Governmental Entity indicated any intention to conduct
the same, other than those the outcome of which would not, individually or in
the aggregate, be reasonably likely to (x) have a Buyer Material Adverse Effect
or (y) materially impair or materially delay the Closing.

 

(b)           Neither Buyer, nor any director, officer, key employee or partner
of Buyer or its Affiliates has received any written claim, demand, notice,
complaint, court order or administrative order from any Governmental Entity in
the past three (3) years under, or relating to, any violation or possible
violation of any Gaming Laws, other than as would not reasonably be expected,
individually or in the aggregate, to (i) have a Buyer Material Adverse Effect or
(ii) materially impair or materially delay the Closing. To the knowledge of
Buyer, there are no facts, which if known to the regulators under the Gaming
Laws could reasonably be expected to result in the revocation, limitation or
suspension of a license, finding of suitability, registration, permit or
approval of Buyer or its Affiliates, or any of their officers, directors, key
employees or Persons performing management functions similar to an officer or
partner, or limited partner under any Gaming Laws. Neither Buyer nor any
officer, director, key employee or Person performing management function similar
to an officer or partner of Buyer or their Affiliates, has suffered a suspension
or revocation of any Buyer Permit held under the Gaming Laws, other than as
would not reasonably be expected, individually or in the aggregate, to (i) have
a Buyer Material Adverse Effect or (ii) materially impair or materially delay
the Closing.

 

Section 8.7             Waiver of Buyer’s Further Due Diligence Investigation.
Subject to ARTICLE XIII hereof, Buyer acknowledges that it is familiar with the
Purchased Assets and has

 

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had the opportunity, directly or through its representatives to inspect the
Purchased Assets and conduct due diligence activities. Without limitation of the
foregoing, Buyer acknowledges that the Purchase Price has been negotiated based
on Buyer’s express agreement that there would be no contingencies to the Closing
other than the conditions set forth in ARTICLE X hereof. Further, without
limiting any representation, warranty, covenant, obligation or condition of
Sellers or the Company expressly set forth herein, Buyer acknowledges that it
has waived and hereby waives as a condition to the Closing any further due
diligence reviews, inspections or examinations with respect to the Real
Property, including with respect to engineering, environmental, survey,
financial, operational, regulatory and legal compliance matters.

 

Section 8.8             Litigation. There are no actions, claims, suits or
proceedings pending or, to Buyer’s knowledge, threatened against Buyer before
any Governmental Entity, which, if determined adversely, could prevent or
materially delay Buyer from completing the transactions contemplated by this
Agreement.

 

ARTICLE IX.

COVENANTS

 

Section 9.1             Conduct of Business Prior to the Closing. During the
period from the date of this Agreement and continuing until the earlier of the
termination of this Agreement or the Closing, subject to any written
instructions of any Governmental Entity and to the limitations set forth below,
Sellers shall cause the Company to (except to the extent as expressly provided
by this Agreement or to the extent that Buyer shall otherwise grant its prior
consent in writing, which consent may not be unreasonably withheld, conditioned
or delayed) carry on the Business in the Ordinary Course of Business, including
the payment of its debts and Taxes when due (subject to good faith disputes over
such debts or Taxes, provided that, in the case of disputes over such Taxes, the
Company’s failure to pay such Taxes when due would not, individually or in the
aggregate, have an adverse effect on Buyer or any of its Affiliates (including,
following the Closing, the Company) that is material), and use commercially
reasonable efforts consistent with past practices and policies to maintain the
effectiveness of the Company Permits, preserve the Purchased Assets, preserve
intact the present business organization, keep available the services of its
present officers and key employees and preserve relationships with customers,
suppliers, distributors and others having business dealings with the Company
with respect to the Business, perform in all material respects all of its
obligations under the Assumed Contracts, comply with all applicable Laws in all
material respects and maintain the books and records of the Company in the
Ordinary Course of Business. Without limiting the generality of the foregoing,
except as expressly provided by this Agreement or as disclosed on Section 9.1 of
the Company Disclosure Letter, during the period from the date of this Agreement
and continuing until the earlier of the termination of this Agreement or the
Closing, without the prior written consent of Buyer (which consent shall not be
unreasonably withheld, conditioned or delayed), the Company shall not, and
Sellers, with respect to subsections (e), (f), (l), (m) and (u) below, shall
not:

 

(a)           sell, transfer, lease, dispose of, grant or otherwise authorize
the sale, transfer, lease, disposition, grant of, any of the Purchased Assets
(other than a Permitted Encumbrance), except for (i) sales of current assets in
the Ordinary Course of Business, (ii) sales

 

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of equipment and other non-current assets in the Ordinary Course of Business
which, individually, do not exceed $25,000 or which, in the aggregate, do not
exceed $500,000, or (iii) leases of the Real Property that are terminable,
without the payment of any consideration for early termination, on no more than
one hundred eighty (180) days’ notice;

 

(b)           incur any Liabilities that are Assumed Liabilities, except for
Liabilities incurred (i) pursuant to Section 9.1(p), or (ii) in the Ordinary
Course of Business not exceeding $100,000 individually or $250,000 in the
aggregate;

 

(c)           enter into, modify, amend, terminate or renew any of the Assumed
Contracts or waive, release or assign any material rights or claims related to
any Assumed Contracts, except (i) for modifications or amendments in the
Ordinary Course of Business that would not reasonably be expected to have an
adverse economic impact on the Business in excess of $100,000 individually or
$250,000 in the aggregate and do not otherwise impair any material right or
claim related to the Assumed Contract or impose or renew any material
restriction on the Company, (ii) for renewals in the Ordinary Course of Business
for a term of twelve (12) months or less or (iii) as required by applicable Law;

 

(d)           subject any of the Purchased Assets to or suffer or permit the
creation on the Purchase Assets of a Lien or Encumbrance, other than Permitted
Liens or Permitted Encumbrances created in the Ordinary Course of Business;

 

(e)           fail to maintain its existing insurance coverage of all types
relating to Purchased Assets (however, in the event any such coverage shall be
terminated or lapse, or any claim is made against such coverage that causes the
amount of insurance coverage to cease to be adequate in accordance with
reasonable commercial standards, Sellers shall notify Buyer as promptly as
practicable, so that Buyer may purchase “gap” insurance at its option, and shall
use their commercially reasonable efforts to procure substantially similar
substitute insurance policies, which in all material respects are in at least
such amounts, subject to the same deductibles, and against such risks as are
currently covered by such policies);

 

(f)            amend the Company’s certificate of formation or operating
agreement (or similar organizational documents), or any terms of their
outstanding equity interests or other securities;

 

(g)           enter into a plan of consolidation, merger, share exchange or
reorganization with any Person, effect any recapitalization, reclassification or
other change in their capitalization, or adopt a plan of complete or partial
liquidation;

 

(h)           waive, release or assign any material rights or material claims
that would otherwise constitute a Purchased Asset, except as contemplated by
this Agreement;

 

(i)            enter into any material transaction or transaction outside of the
Ordinary Course of Business with any Affiliate relating to the Business to the
extent such transaction would be an Assumed Liability or an Assumed Contract;

 

(j)            enter into any Contract the effect of which would be to grant to
a third party any license to use any Transferred Intellectual Property;

 

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(k)           enter into any settlement, consent decree or other agreement or
arrangement with a third party or Governmental Entity other than (i) as does not
involve the institution of mandated new procedures or other business conduct or
the imposition of equitable or similar relief on the Company and (ii) is not
reasonably likely to result in the revocation, limitation or suspension of any
Company Permit;

 

(l)            expend any insurance, condemnation awards or other compensation
awarded for loss or damage to any Purchased Asset;

 

(m)          issue or sell or encumber any Equity Interests or any securities
convertible into, or rights to acquire, any Equity Interests;

 

(n)           purchase any equity interests in or securities of, or make any
other investment in or loans or advances to, any Person;

 

(o)           except in the Ordinary Course of Business, acquire any material
assets that would constitute Purchased Assets;

 

(p)           fail to make maintenance capital expenditures, in the Ordinary
Course of Business, in a total amount equal to the pro rata portion of the
aggregate maintenance capital expenditures for the twelve months beginning on
the effective date contemplated by the capital budget set forth in
Section 9.1(p) of the Company Disclosure Letter (“Required Capital
Expenditures”);

 

(q)           engage in any new line of business;

 

(r)            make any material change to its financial accounting methods,
principles or practices, except as may be required by Law or by GAAP;

 

(s)           make, change or revoke any Tax election, change any of its methods
of reporting income or deductions for Tax purposes, compromise any Tax liability
or settle any Tax claim, audit or dispute, or file any amended Tax Return
except, in each case, for any action that would not, individually or in the
aggregate, have an adverse effect on Buyer or any of its Affiliates (including,
following the Closing, the Company) that is material; or

 

(t)            except (1) as required by a Company Benefit Plan as in effect on
the date hereof, (2) as required by applicable Law, (3) in the Ordinary Course
of Business or (4) as a result of changes or actions by Parent that are not
solely directed at the Company or the Property Employees, (i) enter into, adopt,
amend or terminate any employee benefit plan, program, agreement, arrangement,
commitment or practice for the benefit or welfare of any Property Employee,
other than immaterial amendments that will not result in increased cost to Buyer
and its Affiliates (including, following the Closing, the Company and its
Subsidiaries), (ii) increase the compensation or benefits payable to any
Property Employee or pay any amounts to any Property Employee not otherwise due,
(iii) enter into any new, or amend any existing, Labor Agreement or similar
agreement with respect to the Company, (iv) provide any funding for any rabbi
trust or similar arrangement, or (v) (A) transfer any employee who is a Property
Employee as of the date of this Agreement to an employing entity other than the
Company or to a location other than the Real Property, or otherwise change such
employee’s duties or employer so that the employee would no longer constitute a
Property Employee, (B) take any action that results in the

 

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number of Property Employees on the Closing Date exceeding the number of
Property Employees on the date of this Agreement or (C) transfer the employment
of any Reserved Employee to the Company; or

 

(u)           enter into a Contract to do any of the foregoing, or to authorize
or announce an intention to do any of the foregoing.

 

It is agreed and understood that if Buyer does not grant or deny consent to a
proposed action within five (5) business days of receipt of the written request
by Sellers to take such action by the individuals set forth in Section 9.1 of
the Buyer Disclosure Letter at the email addresses set forth therein, Buyer
shall be deemed to have consented to such action notwithstanding any other
provision of this Section 9.1. Except as expressly contemplated by this
Agreement, nothing contained in this Agreement shall give Buyer, directly or
indirectly, the right to control or direct the Company’s operations prior to the
Closing. Prior to the Closing, the management of the Company shall exercise,
consistent with and in accordance with the terms and conditions of this
Agreement, complete control and supervision over the operations of the Company.

 

Section 9.2             Cooperation; Notice; Cure.

 

(a)           Subject to compliance with applicable Law (including antitrust
Laws and Gaming Laws), from the date hereof until the Closing, Sellers and Buyer
shall confer on a regular basis with one or more Representatives of the other
party to discuss the general status of the Business. Sellers and the Company
shall, to the fullest extent permitted by Law (including antitrust Laws and
Gaming Laws), provide up to four (4) Representatives designated by Buyer (the
“Designated Buyer Representatives”) with reasonable access to the Reserved
Employees during normal business hours, and shall use their reasonable best
efforts to assist the Designated Buyer Representatives in familiarizing
themselves with the operation of the Business.

 

(b)           Sellers and Buyer shall promptly notify the other in writing of,
and will use all commercially reasonable efforts to cure before the Closing
Date, any event, transaction or circumstance, as soon as practical after it
becomes known to such party, that causes or is reasonably expected to cause any
representation, covenant or agreement of Parent, Sellers, the Company or Buyer
under this Agreement to be breached in any material respect or that renders or
is reasonably expected to render untrue in any material respect any
representation or warranty of Parent, Sellers, the Company or Buyer contained in
this Agreement. Nothing contained in Section 9.1 above shall prevent Sellers or
the Company from giving such notice, using such efforts or taking any action to
cure any such event, transaction or circumstance. No notice given pursuant to
this Section 9.2 shall have any effect on the representations, warranties,
covenants or agreements contained in this Agreement for purposes of determining
satisfaction of any condition contained herein.

 

Section 9.3             No Solicitation. Prior to the earlier of the Closing and
the termination of this Agreement in accordance with Section 11.1 hereof,
neither Parent, Sellers, the Company, nor any of their respective shareholders,
members, directors, officers, employees, advisors, agents or other
representatives (collectively, “Representatives”), directly or indirectly,
through Affiliates or otherwise, shall (a) solicit, initiate, or encourage
(including by way of furnishing information) or take any other action to
facilitate knowingly any inquiries or proposals that constitute, or could
reasonably be expected to lead to, a proposal or offer of any kind that
constitute, or could

 

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reasonably be expected to lead to, an Acquisition Proposal, (b) engage in
negotiations or discussions with any person (or group of persons) other than
Buyer or its Affiliates (a “Third Party”) concerning, or provide any non-public
information to any person or entity relating to, any Acquisition Proposal,
(c) continue any prior discussions or negotiations with any Third Party
concerning any Acquisition Proposal or (d) accept, or enter into any agreement
concerning, any Acquisition Proposal with any Third Party or consummate any
Acquisition Proposal. From and after the date hereof until the earlier of the
termination of this Agreement or the Closing, Parent, Sellers and the Company
will, and will cause their respective Affiliates to (i) use their reasonable
best efforts to cause to be returned or destroyed promptly after the date hereof
all confidential information provided or made available to any Person other than
Buyer and its Affiliates and its and their Representatives in connection with a
potential transaction involving the Business or the Company, (ii) terminate all
access for such Persons to the electronic dataroom accessible through RR
Donnelley Venue with respect to the Business and (iii) not amend, modify, waive
or fail to enforce any of the terms or conditions included in any
confidentiality agreements with respect to the Business or the Company.

 

Section 9.4             Employee Matters.

 

(a)           Each Property Employee, other than the Reserved Employees, who is
an employee of the Company as of the Closing shall hereinafter be referred to as
a “Transferred Employee”. Each of the Property Employees is an at-will employee,
except that certain Property Employees may be eligible for severance
compensation upon certain termination events under an employment agreement that
covers any such Property Employee as set forth on Section 7.13(a) of the Company
Disclosure Letter.

 

(b)           Effective as of the Closing, Buyer shall assume all employment
agreements set forth in Section 9.4(b) of the Company Disclosure Letter to the
extent in effect as of the Closing, provided that the applicable Property
Employee consents to such assignment to the extent required by the terms of the
applicable employment agreement.

 

(c)           For a period of at least one (1) year immediately following the
Closing Date, (x) Buyer shall provide the Transferred Employees who remain
employed by the Company with base compensation, bonus opportunity and annual and
long-term incentive compensation opportunity that are in the aggregate, on an
employee by employee basis, no less favorable than those which the Transferred
Employees were provided by the Company or its Affiliates immediately prior to
the Closing and (y) Buyer shall honor the severance policies of the Company and
its Affiliates with respect to Transferred Employees.

 

(d)           For a period of at least one (1) year immediately following the
Closing Date, Buyer shall, pursuant to plans and arrangements established or
maintained by Buyer (the “Buyer Benefit Plans”), provide the Transferred
Employees who remain employed by the Company employee benefits (including
medical benefits) which are no less favorable in the aggregate on an employee by
employee basis than those which the Transferred Employees were provided under
the Company Benefit Plans immediately prior to Closing. To the extent permitted
under the terms of the Buyer Benefit Plans, Buyer shall cause service with the
Company and its Affiliates prior to the Closing to be treated the same as
service with any of Buyer and its Affiliates from and after the Closing Date for
purposes of eligibility, vesting, and benefit accrual under the Buyer Benefit
Plans (except (i) to the extent giving such credit would

 

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result in duplication of benefits, (ii) for benefit accrual purposes under any
defined benefit pension plan, (iii) for purposes of any retiree medical plan or
(iv) for any newly established plan of Buyer for which similarly situated
employees of Buyer do not receive past service credit).

 

(e)           Effective immediately after the Closing, Buyer shall cause the
Transferred Employees to be covered by one or more medical benefit plans
(“Buyer’s Medical Plans”), which shall provide benefits to the Transferred
Employees and their dependents which in the aggregate are substantially
comparable to the benefits that were provided to the Transferred Employees and
their dependents by the Company Benefit Plans immediately prior to Closing. To
the extent permitted under the terms of Buyer’s Medical Plans, Buyer shall cause
any Transferred Employees or their dependents to not be subject to any
“pre-existing conditions” exclusions or limitations or “actively at work”
requirements which would cause any of the Transferred Employees or their
dependents otherwise to be excluded from Buyer’s Medical Plans immediately after
the Closing. To the extent permitted under the terms of Buyer’s Medical Plans,
Buyer shall give effect, in determining any deductible and maximum out-of-pocket
limitations, to claims incurred and amounts paid by, and amounts reimbursed to,
such employees for the calendar year in which the Closing occurs under any
welfare benefit plans maintained or contributed to by the Company for its
benefit immediately prior to the Closing Date.

 

(f)            Effective as of the Closing Date, Buyer shall establish or
designate a defined contribution retirement plan which is qualified or eligible
for qualification under Section 401(a) of the Code (the “Buyer’s 401(k) Plan”).
Each Transferred Employee who participates in the Harrah’s Entertainment, Inc.
Savings and Retirement Plan (the “Company 401(k) Plan”) who satisfies the
eligibility requirements of Buyer’s 401(k) Plan shall become eligible to
participate in Buyer’s 401(k) Plan on the date he or she becomes an employee of
Buyer and, to the extent permitted under the terms of Buyer’s 401(k) Plan, Buyer
shall cause such Transferred Employee to be credited with eligibility service
and vesting service for all periods of service with the Company or any other
Person if so credited with such service under the Company 401(k) Plan. Buyer or
its applicable Subsidiary shall cause Buyer’s 401(k) Plan to accept “eligible
rollover distributions” (as defined in Section 402(c)(4) of the Code) from
Transferred Employees with respect to such Transferred Employees’ account
balances (including loans) under the Company 401(k) Plan in the form of cash
(and, as applicable, promissory notes with respect to loans), if elected by such
Transferred Employees.

 

(g)           The Company maintains a plan qualified under Section 125 of the
Code (the “Company’s 125 Plan”) that includes flexible spending accounts for
medical care reimbursements and dependent care reimbursements (“Reimbursement
Accounts”). As soon as reasonably practicable following the Closing Date, cash
equal to the aggregate value as of the Closing Date of the Reimbursement
Accounts of the Transferred Employees shall be transferred from the Company to a
plan established by Buyer intended to qualify under Section 125 of the Code
(“Buyer’s 125 Plan”). Upon receipt of such amount, Buyer and Buyer’s 125 Plan
shall assume all obligations with respect to the Reimbursement Accounts for the
Transferred Employees as of the Closing Date. Buyer shall recognize the
elections of the Transferred Employees under the Company’s 125 Plan for purposes
of Buyer’s 125 Plan for calendar year 2012. The Company shall provide Buyer with
all information reasonably requested in order for Buyer and Buyer’s 125 Plan to
satisfy the obligations set forth in this Section 9.4(g).

 

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(h)           No provision of this Agreement shall create any third party
beneficiary rights in any Transferred Employee, or any beneficiary or dependent
thereof, with respect to the compensation, terms and conditions of employment
and/or benefits that may be provided to any Transferred Employee by Buyer or
under any benefit plan which Buyer may maintain. In no event shall the terms of
this Agreement be deemed to (i) establish, amend, or modify any Company Benefit
Plan or any other benefit plan, program, agreement or arrangement maintained or
sponsored by Buyer, the Company or any Subsidiary of the Company or any of their
respective Affiliates; (ii) alter or limit the ability of Buyer or any of its
Subsidiaries (including, after the Closing Date, the Company or any Subsidiary
of the Company) to amend, modify or terminate any benefit or employment plan,
program, agreement or arrangement after the Closing Date; or (iii) confer upon
any Property Employee any right to employment or continued employment or
continued service with Buyer or any of its Subsidiaries (including, following
the Closing Date, the Company or any Subsidiary of the Company), or constitute
or create an employment or other agreement with any Property Employee.

 

(i)            On or following the Closing, Buyer shall comply with all
provisions of the WARN Act with respect to all Transferred Employees. As part of
its obligations under ARTICLE XII hereof, Buyer shall indemnify, defend and hold
Sellers and the Company harmless from and against any Liability to any
Transferred Employees or any Governmental Entity that may result to Sellers
and/or the Company based on Buyer’s failure to comply with any provision of the
WARN Act as required by this Section 9.4(i), including, but not limited to,
fines, back pay and attorneys’ fees. Sellers shall notify Buyer of any
terminations of the employment of any employees of the Company that occur during
the ninety (90)-day period prior to the Closing.

 

(j)            Sellers shall indemnify, defend and hold Buyer and its Affiliates
harmless from and against any Controlled Group Liability.

 

Section 9.5             Access to Information and the Real Property;
Post-Closing Cooperation.

 

(a)           Upon reasonable notice, subject to applicable Law, including
antitrust Laws and Gaming Laws, the Company shall afford Buyer’s Representatives
reasonable access, during normal business hours, during the period from the date
hereof to the Closing, to the Real Property (including the Casino) and to all
personnel, properties, books, Contracts and records of the Casino and, during
such period, the Company shall furnish promptly to Buyer all material
information concerning the Business (including the Real Property) as Buyer may
reasonably request (collectively, the “Inspection”); provided, however, that
(i) Buyer shall provide the Company with at least twenty-four (24) hours’ prior
written notice of any Inspection; (ii) if the Company so requests, Buyer’s
Representatives shall be accompanied by a Representative of the Company;
(iii) Buyer shall not initiate contact with employees or other representatives
of the Company other than such Representative designated by the Company without
the prior written consent of Sellers or the Company, which consent shall not be
unreasonably withheld or delayed; (iv) Buyer’s Representatives shall not be
entitled to perform any physical testing of any nature with respect to any
portion of the Real Property without the Company’s prior written consent if in
the reasonable judgment of the Company such testing would reasonably be expected
to materially interfere with the Business and/or cause damage to the Purchased
Assets; (v) Buyer shall not materially interfere with the Business; (vi) Buyer
shall, at its sole cost and expense, promptly repair any damage to the Purchased
Assets or any other property owned by a Person

 

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other than Buyer arising from or caused by Inspection, and shall reimburse the
Company for any loss arising from or caused by any Inspection, and restore the
Purchased Assets or such other third-party property to substantially the same
condition as existed prior to such Inspection, and shall indemnify, defend and
hold harmless Sellers, the Company and its Affiliates from and against any
personal injury or property damage claims, liabilities, judgments or expenses
(including reasonable attorneys’ fees) incurred by any of them arising or
resulting therefrom; and (vii) in no event shall this Section 9.5(a) constitute
a limitation of Buyer’s waiver of further due diligence in Section 8.7 hereof,
nor shall the results of any such Inspection be a condition to Buyer’s
obligations under this Agreement or limit the provisions of Section 13.5 hereof.
Prior to entering the Real Property to perform any tests and assessments or for
any other reason permitted hereunder and, thereafter, Buyer shall maintain a
policy of comprehensive public liability insurance in an amount not less than
$10,000,000 naming the Company as additional primary insured, insuring against
any and all Liabilities for damages to property or injury or death to persons
arising out of the entry onto the Real Property of all persons and property on
Buyer’s behalf. Such insurance policy shall be with a nationally recognized
insurance company reasonably acceptable to the Company and shall provide that it
may not be terminated without providing the Company at least thirty (30) days
written notice. Prior to Buyer’s entry onto the Real Property, Buyer shall
deliver to the Company a certificate of insurance evidencing the insurance
policy required by this Section 9.5(a).

 

(b)           Following the Closing Date, each party hereto will hold, and will
use its best efforts to cause its Affiliates and its and their respective
Representatives to hold, in strict confidence from any Person (other than any
such Affiliate or Representative) all documents and information concerning the
other party or any of its Affiliates (and, for the avoidance of doubt, treating
information concerning the Business and the Purchased Assets as information
concerning Buyer) unless (i) compelled to disclose by judicial or administrative
process (including in connection with obtaining the necessary approvals of this
Agreement and the transactions contemplated hereby of any Governmental Entity)
or by other requirements of Law or (ii) disclosed in an action or proceeding
brought by another party hereto in pursuit of its rights or in the exercise of
its remedies hereunder, or unless such documents or information can be shown to
have been (1) previously known by the party receiving such documents or
information (other than pursuant to breach of an agreement to keep such
information confidential), (2) in the public domain (either prior to or after
the furnishing of such documents or information hereunder) through no fault of
such receiving party or (3) later acquired by the receiving party from another
source if the receiving party is not aware that such source is under an
obligation to another party hereto to keep such documents and information
confidential. Buyer and the Company agree that in the event any proprietary
information or knowledge relating to an Excluded Asset is obtained, revealed or
otherwise made known to Buyer in effecting (x) the transition from Excluded
Software to replacement software pursuant to Section 1.4(c) hereof,
specifically, or (y) the removal of the Excluded Assets, generally, Buyer shall
not reveal, disclose, employ or otherwise use any such proprietary information
and will hold such information in confidence in accordance with the terms of the
Confidentiality Agreement. No information or knowledge obtained in any
investigation pursuant to this Section 9.5 shall affect or be deemed to modify
the obligations of the parties to consummate the transactions contemplated
herein.

 

(c)           Following the Closing, and for so long as Sellers on the one hand
or Buyer on the other hand, or their respective Affiliates are prosecuting,
participating in, contesting or

 

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defending any action, claim, investigation, suit or proceeding, whenever filed
or made, in connection with or involving in any way (i) this Agreement or the
transactions contemplated hereby or (ii) the conduct or operation of the
Business prior to or after the Closing, including any action, claim,
investigation, suit or proceeding related to the Excluded Assets and/or the
Excluded Liabilities, the other party shall (and shall cause its Affiliates, and
its and their respective Representatives, to) (A) cooperate with such party and
its Affiliates and their Representatives with the prosecution, participation,
contest or defense, (B) provide such party and its Affiliates and their
Representatives with reasonable access and duplicating rights to all properties,
books, contracts, commitments and records (whether in paper or electronic form)
related to the Real Property and (C) make available to such party and its
Affiliates and their Representatives its personnel (including, by Buyer, the
Transferred Employees), including for purposes of fact finding, consultation,
testimony, interviews, depositions and witnesses, in each case as shall be
reasonably necessary in connection with the prosecution, participation, contest
or defense of the applicable action, claim, investigation, suit or proceeding by
such party and its Affiliates and Representatives.

 

(d)           Upon reasonable notice, subject to applicable Law, including
antitrust Laws and Gaming Laws, Parent shall afford Buyer’s Representatives
reasonable access, during normal business hours, for up to ninety (90) days
following the Closing, to each Reserved Employee for so long as he or she is an
employee of Parent or its Subsidiaries; provided, however, that Buyer shall not
initiate contact with the Reserved Employees without the prior written consent
of Parent, which consent shall not be unreasonably withheld or delayed.

 

Section 9.6             Governmental Approvals.

 

(a)           The parties hereto shall cooperate with each other and use their
reasonable best efforts to (i) as promptly as practicable, take, or cause to be
taken, all appropriate action, and do or cause to be done, all things necessary,
proper or advisable under applicable Law or otherwise to consummate and make
effective the transactions contemplated by this Agreement as promptly as
practicable; (ii) obtain from any Governmental Entities any consents, approvals,
findings of suitability, expiration or terminations of waiting periods,
licenses, permits, waivers, approvals, orders or authorizations required (A) to
be obtained or made by Sellers, the Company or Buyer or any of their respective
Affiliates or any of their respective Representatives and (B) to avoid any
action or proceeding by any Governmental Entity (including those in connection
with the HSR Act), in connection with the authorization, execution and delivery
of this Agreement and the consummation of the transactions governed herein; and
(iii) make all necessary registrations, declarations and filings, and thereafter
make any other submissions with respect to this Agreement, as required under
(A) any applicable federal or state securities Laws, (B) the HSR Act, (C) the
Gaming Laws, including, providing information with respect to, executing, filing
and participating in meetings with the Missouri Gaming Commission with respect
to, the Petition for Change in Control and (D) any other applicable Law
(collectively, the “Governmental Approvals”), and to comply with the terms and
conditions of all such Governmental Approvals. The parties hereto and their
respective Representatives and Affiliates shall file as promptly as practicable,
but in no event later than fifteen (15) days after the date hereof, all required
initial applications and documents in connection with obtaining the Governmental
Approvals (including under applicable Gaming Laws and the HSR Act) and shall act
diligently and promptly to pursue the Governmental Approvals and shall cooperate
with each other in connection with the making of all filings referenced in the
preceding sentence, provided

 

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that, Buyer shall bear the ultimate responsibility of obtaining all Gaming
Approvals on or before the Outside Date. Subject to applicable Laws relating to
the exchange of information, prior to making any application or material written
communication to or filing with any Governmental Entity with respect to
Governmental Approvals, each party shall provide the other parties with drafts
thereof and afford the other parties a reasonable opportunity to comment on such
drafts. Buyer, Sellers and the Company shall use reasonable best efforts to
schedule and attend any hearings or meetings with Governmental Entities to
obtain the Governmental Approvals as promptly as possible, and, to the extent
permitted by the Governmental Entity, each party shall offer the other parties
the opportunity to participate in all telephonic conferences and all meetings
with any Governmental Entity to the extent relating to Governmental Approvals.
Buyer, Sellers and the Company shall, to the extent practicable, consult with
the other parties on, in each case, subject to applicable Laws relating to the
exchange of information (including antitrust Laws and Gaming Laws), all the
information relating to Buyer, Sellers or the Company, as the case may be, and
any of their respective Affiliates or Representatives which appear in any filing
made with, or written materials submitted to, any third party or any
Governmental Entity to the extent made or submitted in connection with the
transactions contemplated by this Agreement, other than personal information on
individuals who are filing applications. Without limiting the foregoing, Buyer,
Sellers and the Company will notify the other parties promptly of the receipt of
comments or requests or other communications (whether oral or written) from
Governmental Entities to the extent relating to Governmental Approvals and,
promptly supply the other parties with copies of all written correspondence
between the notifying parties or any of their Representatives and Governmental
Entities with respect to Governmental Approvals. Buyer, Sellers and the Company
shall share responsibility for devising and implementing the strategy for
obtaining any clearances required under the HSR Act in connection with the
transactions contemplated by this Agreement, provided, however, that (i) in the
event of disagreement between Buyer on the one hand and Sellers and the Company
on the other hand, Buyer’s view shall prevail, and (ii) Buyer shall take the
lead in all meetings and communications with any Governmental Entity in
connection with obtaining such clearances.

 

(b)           Without limiting Section 9.6(a) hereof, Buyer, Sellers and the
Company shall:

 

(i)            each use its reasonable best efforts to avoid the entry of, or to
have vacated or terminated, any decree, order, or judgment that would restrain,
prevent or delay the Closing, on or before the Outside Date, including defending
through litigation on the merits any claim asserted in any court by any Person;
and

 

(ii)           each use its reasonable best efforts to avoid or eliminate each
and every impediment under any antitrust, competition or trade regulation Law
that may be asserted by any Governmental Entity or any other Person with respect
to the Closing so as to enable the Closing to occur as soon as reasonably
possible (and in any event no later than the Outside Date), including
implementing, contesting, or resisting any litigation before any court or
administrative tribunal seeking to restrain or enjoin the Closing; provided,
however, that Buyer and its Affiliates shall be required to (and nothing in this
Agreement shall require Sellers, the Company or any of its Affiliates to) commit
to any divestitures, licenses or hold separate or similar arrangements with
respect to its or their respective assets or conduct of business arrangements,
to the extent necessary to obtain any approval from a Government Entity required
to consummate the transactions contemplated hereby.

 

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(c)           Buyer, Sellers and the Company shall promptly advise each other
upon receiving any communication from any Governmental Entity whose consent or
approval is required for consummation of the transactions contemplated by this
Agreement to the extent that such communication is related to the Governmental
Approvals. Buyer, Sellers and the Company shall each use its reasonable best
efforts to take, or cause to be taken, all actions reasonably necessary to
defend any lawsuits or other legal proceedings challenging this Agreement or the
consummation of the transactions contemplated hereby and shall seek to prevent
the entry by any Governmental Entity of any decree, injunction or other order
challenging this Agreement or the consummation of the transactions contemplated
hereby. The parties agree to appeal, as promptly as possible, any decree,
injunction or other order challenging this Agreement or the consummation of the
transaction contemplated hereby and use reasonable best efforts to have any such
decree, injunction or other order vacated or reversed.

 

(d)           From the date of this Agreement until the Closing, each party
shall promptly notify all other parties hereto in writing of any pending or, to
the knowledge of Buyer, Sellers or the Company, as appropriate, threatened
action, suit, arbitration or other proceeding or investigation by any
Governmental Entity or any other Person (i) challenging or seeking damages in
connection with the Closing or any other transaction contemplated by this
Agreement or (ii) seeking to restrain or prohibit the consummation of the
Closing.

 

Section 9.7             Publicity. Parent and Sellers on the one hand and Buyer
on the other hand shall agree on the form and content of the initial press
release regarding the transactions contemplated hereby and thereafter shall
consult with each other before issuing, provide each other the opportunity to
review and comment upon, and use commercially reasonable efforts to agree upon,
any press release or other public statement with respect to any of the
transactions contemplated hereby and shall not issue any such press release or
make any such public statement prior to such consultation and prior to
considering in good faith any such comments, except as may be required by
applicable Law or any listing agreement with any nationally recognized stock
exchange. Notwithstanding anything to the contrary herein, Buyer and Parent may
make any public statement in response to questions by the press, analysts,
investors or those attending industry conferences or financial analysts
conference calls, so long as any such statements are not inconsistent with
previous press releases, public disclosures or public statements made jointly by
Buyer and Parent or made by one party and reviewed by the other and do not
reveal non-public information regarding the transactions contemplated by this
Agreement.

 

Section 9.8             Further Assurances and Actions.

 

(a)           Subject to the terms and conditions herein, each of the parties
hereto agrees to use its reasonable best efforts to take, or cause to be taken,
all appropriate action, and to do, or cause to be done, all things reasonably
necessary, proper or advisable under applicable Laws to consummate and make
effective the transactions contemplated by this Agreement, including,
(i) obtaining all licenses, permits, consents, approvals, authorizations,
qualifications and orders of Governmental Entities and parties to Contracts as
are necessary or advisable for consummation of the transactions contemplated by
this Agreement and (ii) to fulfill all conditions precedent applicable to the
Closing.

 

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(b)           In case at any time after the Closing any further action is
necessary to carry out the purposes of this Agreement, to vest Buyer with full
title to the Equity Interests, the Purchased Assets and the assumption of the
Assumed Liabilities, or to vest Sellers with full title to the Excluded Assets
and the assumption of the Excluded Liabilities, Buyer, Sellers and the Company
shall take all commercially reasonable action necessary (including executing and
delivering further notices, assumptions, releases and acquisitions); provided,
that if such action is necessary due to events or circumstances particular to
Buyer, Buyer shall bear the cost of such action, and otherwise Sellers shall
bear the cost of such action. All costs and expenses related to recording the
Trademark Assignment Agreement shall be borne by Buyer.

 

Section 9.9             Transfer Taxes; HSR Filing Fee.

 

(a)           All transfer, recording, documentary, sales, use, stamp,
registration and other such Taxes (including real estate transfer or similar Tax
that arise from any indirect transfer of property as a result of the transfer of
the Equity Interests) and related fees (including any penalties, interest and
additions to Tax) incurred with respect to the purchase and sale of the Equity
Interests pursuant to this Agreement (“Transfer Taxes”) shall be paid by Buyer.
Buyer shall indemnify, defend and hold Sellers harmless from and against any and
all amounts for which Buyer is liable pursuant to this Section 9.9(a) . The
party responsible under applicable Law for filing the Tax Returns pertaining to
and paying such Transfer Taxes shall (i) timely file such Tax Returns and remit
to the applicable Governmental Authority payment of the Transfer Taxes required
to be remitted therewith and (ii) promptly provide a copy of such Tax Return to
the other party. If Sellers have paid such Transfer Taxes they shall be
reimbursed for such Taxes promptly by Buyer. Buyer and Sellers shall cooperate
as requested in preparing, executing and filing all such Tax Returns and related
documentation on a timely basis as may be required to comply with the provisions
of any applicable Law.

 

(b)           The filing fee required to be paid in connection with the
pre-merger notification filing under the HSR Act shall be paid by Buyer.

 

Section 9.10           No Control. Except as permitted by the terms of this
Agreement, prior to the Closing, Buyer shall not directly or indirectly control,
supervise, direct or interfere with, or attempt to control, supervise, direct or
interfere with, the Company, including the Casino, the Real Property and the
other Purchased Assets. Until the Closing, the operations and affairs of the
Company, including the Casino, the Real Property and the other Purchased Assets,
are the sole responsibility of and under the Company’s complete and exclusive
control, except as expressly provided for in this Agreement.

 

Section 9.11           Reservations; Guests; Valet Parking; Other Transition
Matters.

 

(a)           Reservations. Buyer will honor the terms and rates of all
reservations (in accordance with their terms) at the Casino made prior to the
Closing by guests or customers, including advance reservation cash deposits, for
rooms or services confirmed by the Company for dates after the Closing Date,
provided that such agreements were made in the Ordinary Course of Business. From
and after the date hereof, the Company may continue to accept reservations for
periods after the Closing in the Ordinary Course of Business. Buyer recognizes
that such reservations may include discounts or other benefits, including
benefits under frequent player or casino awards programs, group discounts, other
discounts or requirements that food,

 

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beverage or other benefits be delivered by Buyer to the guest(s) holding such
reservations following the Closing. Buyer will honor all room allocation
agreements and banquet facility and service agreements which have been granted
to groups, persons or other customers for periods after the Closing Date at the
rates and terms provided in such agreements; provided that such agreements were
made in the Ordinary Course of Business. Buyer agrees that Sellers can make, or
have made, any representation or warranty that any party holding a reservation
or agreement for rooms, facilities or services will utilize such reservation or
honor such agreement and Buyer, by the execution hereof, assumes the risk of
non-utilization of reservations and non-performance of such agreements from and
after the Closing.

 

(b)           Guests’ Safe Deposit Boxes. Not later than thirty (30) days prior
to the Closing, the Company shall use commercially reasonable efforts to send a
notice by certified mail to the last known address of each Person who has stored
personal property in safe deposit boxes located at the Casino, advising them
that they must make arrangements with Buyer to continue use of their safe
deposit box and that if they should fail to do so within fifteen (15) days after
the date of such notice is sent, the box will be opened in the presence of a
Representative of the Company, a Representative of Buyer, and a Notary Public;
and the contents of such box will be sealed in a package by the Notary Public,
who shall write on the outside the name of the Person who rented the safe
deposit box and the date of the opening of the box in the presence of the
Representatives of the Company and Buyer, respectively. The Notary Public and
the Representatives of the Company and Buyer shall then execute a certificate
reciting the name of the Person who rented the safe deposit box, the date of the
opening of the box and a list of its contents. The certificate shall be placed
in the package and a copy of it sent by certified mail to the last known address
of the person who rented the safe deposit box. The package will then be placed
in a vault arranged by Buyer. Pursuant to ARTICLE XII hereof, Parent and Sellers
shall be responsible for and indemnify Buyer against claims of alleged missing
items not contained on the certificate, and Buyer shall be responsible for and
indemnify Sellers against claims of alleged missing items listed on the
certificate.

 

(c)           Guests’ Baggage. Prior to the Closing, the Company and Buyer shall
take inventory of: (i) all baggage, suitcases, luggage, valises and trunks of
hotel guests checked or left in the care of the Casino; (ii) all luggage or
other property of guests retained by the Casino as security for unpaid accounts
receivable; and (iii) the contents of the baggage storage room; provided,
however, that no such baggage, suitcases, luggage, valises or trunks shall be
opened. Except for the property referred to in (ii) above, which shall be
removed from the Casino by the Company within ten (10) days after the Closing,
all such baggage and other items shall be sealed in a manner to be agreed upon
by the parties and listed in an inventory prepared and signed jointly by
Representatives of the Company and Buyer as of the Closing. Said baggage and
other items shall continue to be stored by the Company and Buyer shall be
responsible for claims with respect thereto.

 

(d)           Front Money.

 

(i)            Pursuant to the Gaming Laws of the State of Missouri, the Company
shall, at least thirty (30) days prior to the Closing, to the extent legally
required, submit for approval to all applicable Gaming Authorities a plan
containing customary terms for the inventory of the Front Money at the Casino.
Buyer and the Company agree to cooperate

 

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fully with each other in effectuating the plan that is approved by the
applicable Gaming Authorities.

 

(ii)           Effective as of the Closing, Representatives of Buyer and the
Company shall take inventory of all Front Money and identify what Persons are
entitled to what portions of such Front Money. All such Front Money shall be
retained in the Casino cage and listed in an inventory prepared and signed
jointly by Representatives of Buyer and the Company no later than the Closing.
Buyer shall be responsible from and after the Closing for all Front Money and
shall distribute Front Money only to the Persons and only in the amounts as
determined pursuant to this Section 9.11(d).

 

(e)           Vehicles with Valet Parking. On the Closing Date, the Company
shall transfer control of all motor vehicles that were checked and placed in the
care of the Business (the “Inventoried Vehicles”) to Buyer. Thereafter, Buyer
shall be responsible for the Inventoried Vehicles, provided that Sellers shall
be liable to the owners of such Inventoried Vehicles with respect to any damages
occurring prior to the Closing Date as a result of actions taken by the Business
and its employees or contractors (including damages (as a result of actions
taken by the Business and its employees or contractors) set forth in the damage
report) or items missing from or damaged in such Inventoried Vehicles and such
liability shall be an Excluded Liability for the purposes of this Agreement.

 

(f)            Rebranding. Prior to and following the Closing Date, as the case
may be, the Company, Sellers and Buyer shall timely complete all steps required
under the Rebranding Plan attached hereto as Schedule A.

 

(g)           Transition Planning. In order to facilitate an effective
transition of all of the services, systems and functions necessary to operate
the Business (the “Transitioned Functions”) from Sellers to Buyer and its
Affiliates at Closing, during the thirty (30) day period after the Effective
Date (the “Transition Planning Date”), the Parties shall work together in good
faith in the development of a reasonably detailed written plan (the “Transition
Plan”) setting out the steps that the parties will take to transition the
Transitioned Functions from Parent and Sellers to Buyer and its Affiliates,
including among other things the transition of any leased slot machines located
at the Casino, and to send communications to customers regarding the
transactions contemplated hereby. Each party shall use its reasonable best
efforts to perform its responsibilities under the Transition Plan in order to
effect transition of all Transitioned Functions to Buyer and its Affiliates at
or prior to Closing. If Sellers do not identify to Buyers a Transitioned
Function, in connection with the creation of the Transition Plan, on or prior to
the Transition Planning Date, and such omission would materially impair Buyer’s
ability to operate the Casino after the Closing Date, then, at Buyer’s request,
Parent shall agree to perform such Transitioned Function on behalf of the
Company, at cost, for a number of days from and after the Closing Date equal to
the number of days that passed after the Transition Planning Date before Sellers
first identify such Transitioned Function to Buyer; provided, that Parent shall
not be required to perform any Transitioned Functions on behalf of the Company
pursuant to this Section 9.11(g) after a date that is ninety (90) days after the
Closing Date.

 

Section 9.12           Transfer of Utilities. Prior to the Closing, the Company
shall notify all utility companies servicing the Real Property of the
anticipated change in ownership of the Real Property and request that all
billings after the Closing be made to Buyer at the applicable Real

 

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Property. Buyer shall be responsible for paying all deposits required by utility
companies in order to continue service at the Real Property for periods after
the Closing and shall take any other action and make any other payments required
to assure uninterrupted availability of utilities at the Real Property for all
periods after the Closing. Following the Closing, all utility deposits made by
the Company relating to the pre-Closing period will be refunded directly to
Sellers by the utility company holding same; provided that if any such utility
deposit is returned to the Company following the Closing, Buyer shall promptly
remit such deposit to Sellers.

 

Section 9.13           Certain Transactions. From the date hereof until the
Closing Date, neither Buyer, Sellers nor the Company shall, and shall not permit
any of their respective Affiliates to, acquire or agree to acquire by merging or
by consolidating with, or by purchasing assets of or a substantial portion of
equity in, or any other manner, any business or any corporation, partnership,
association or other business organization or division thereof engaged in the
gaming business in the State of Missouri and/or the greater St. Louis area if
such acquisition or agreement to acquire could reasonably be expected to
adversely affect Buyer’s ability to obtain the Gaming Approvals or to consummate
the transactions contemplated by this Agreement, as applicable.

 

Section 9.14           FCC Approvals.

 

(a)           The Company and Buyer will, as applicable, within ten (10) days of
the Effective Date, execute and file filing copies of FCC applications to either
(i) seek the consent of the FCC to the assignment of the FCC Licenses to Buyer,
or (ii) have the FCC Licenses reissued by the FCC in the name of Buyer, as
appropriate (collectively, the “FCC Approvals”). The Company and Buyer agree to
use their respective reasonable best efforts to cooperate with any requests for
information, filing of forms, communications with the FCC or other actions which
are reasonably necessary in order to obtain the FCC Approvals.

 

(b)           If the FCC Approvals have not been obtained on or before the
Closing Date and no special temporary authority has been granted by the FCC that
allows Buyer to operate under the FCC Licenses, then (i) the Closing shall
nevertheless occur as scheduled, and (ii) the parties will comply with any
applicable requirements of the FCC or applicable Law (including the Company
tendering for cancellation the FCC Licenses). Buyer agrees that it will not use
or operate the equipment which is the subject of the FCC Licenses or the FCC
Approvals after the Closing in violation of any requirements of the FCC or any
applicable Law.

 

Section 9.15           Insurance and Casualty. If, before the Closing, the
Casino is damaged by fire or other casualty, then, subject to the satisfaction
or waiver by the applicable party of the conditions set forth in ARTICLE X
hereof, the Closing shall proceed as scheduled, and Sellers shall, after the
Closing Date, (i) promptly pay to Buyer all insurance proceeds received by
Sellers or their Affiliates with respect to such damage, destruction or other
loss, less any proceeds applied to the physical restoration of the Casino, to
the extent such restoration expenditures were approved by Buyer in writing,
(ii) take such actions as may reasonably be requested by Buyer in connection
with the tendering of such claims to the applicable insurers with respect to
such damage, destruction or other loss and (iii) assign to Buyer all rights of
Sellers and their Affiliates against third parties (other than against its
insurance carriers) with respect to any causes of action, whether or not
litigation has commenced as of the Closing Date, in connection with such damage,
destruction or other loss; provided, that the proceeds of such insurance shall
be subject

 

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to (and recovery thereon shall be reduced by the amount of) any applicable
deductibles and co-payment provisions or any payment or reimbursement and shall
constitute full compensation for the damage to the Casino, and Sellers and their
Affiliates shall have no responsibility for restoration or repair of the Casino
or any resultant loss, directly, by subrogation, or otherwise; and provided,
further, that if one or more prior claims has been made after the Effective Date
against the insurance with respect to the Purchased Assets that causes the
amount of insurance coverage to be insufficient to cover such damage,
destruction or other loss and the Company has failed to notify Buyer of such
claim(s) pursuant to Section 9.1(e), then Sellers shall pay or cause to be paid
the insurance proceeds with respect to such other claim(s) to Buyer so that it
receives the full amount of insurance proceeds that it would have received but
for such prior claim(s).

 

Section 9.16           Certain Notifications. From the date of this Agreement
until the Closing, Parent, Sellers, the Company and Buyer shall promptly notify
the other parties in writing, as soon as practical after it becomes known to
such party, of:

 

(a)           any breach by such party of any of its representations,
warranties, covenants or obligations contained in this Agreement; and

 

(b)           any fact, circumstance, event or action which will result in, or
would reasonably be expected to result in, the failure of Parent, Sellers, the
Company or Buyer to timely satisfy any of the closing conditions specified in
ARTICLE X hereof.

 

Nothing contained in Section 9.16 shall prevent Parent, Sellers, the Company or
Buyer from giving such notice, using such efforts or taking any action to cure
any of the foregoing. No notice given pursuant to this Section 9.16 shall have
any effect on the representations, warranties, covenants or agreements contained
in this Agreement for purposes of determining satisfaction of any condition
contained herein or the parties’ rights to indemnification hereunder.

 

Section 9.17           Non-Solicitation. Each party agrees that it shall not,
and shall cause their respective Affiliates not to, prior to the one (1)-year
anniversary of the Closing Date, solicit employment of employees of the other
party or the other party’s Affiliates that such soliciting party had substantial
contact with as a result of the transactions contemplated by this Agreement;
provided, however, that the restrictions contained in this Section 9.17 shall
not apply to (a) general solicitations not specifically directed to any employee
of a party or such party’s Affiliates, and (b) any solicitation or hiring of an
individual who is not employed by the other party or such party’s Affiliates at
the time of such solicitation or hiring of that individual and so long as such
party did not cause, induce or attempt to cause or induce such employee to no
longer be employed by such other party.

 

Section 9.18           Transfer of Assets. To the extent that Parent, Sellers or
any of their Affiliates (other than the Company) holds at or prior to the
Closing any asset, property or right that is exclusively used or held for use in
connection with the Business, Sellers shall cause such Person to promptly, and
in any event prior to the Closing, transfer such asset, property or right to the
Company.

 

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Section 9.19           Customer List.

 

(a)           Consent. Parent or Sellers shall solicit customers’ consents, on
an “opt-out” basis, for transfer of the information on the Customer List and the
Rewards Information not less than forty five (45) days prior to the anticipated
Closing Date.

 

(b)           No Direct Marketing. From and after the Closing until the four
(4) year anniversary of the Closing Date, Parent and Sellers shall not, and
shall cause their Affiliates not to (i) make any direct marketing to the
customers on the Customer List for any casino property within a ninety (90)-mile
radius of the Casino or (ii) sell, license or otherwise permit any Person to use
the Customer Database or any portion thereof to make any direct marketing to the
customers on the Customer List for any property within a ninety (90)-mile radius
of the Casino; provided, that this Section 9.19(b) shall not restrict Parent and
Sellers from marketing to customers on the Customer List in connection with
online gaming, online play-for-fun games, or other online interactive games
conducted by Parent.

 

Section 9.20           Lien Release. Parent and Sellers shall use their
reasonable best efforts to facilitate and encourage the making of any filings,
releases, discharges, deeds and other documents necessary to evidence the
release by all financial institutions and other Persons to which any
indebtedness (including guarantee obligations in respect thereof) of the Company
is outstanding (the “Lenders”) of all Liens and Encumbrances in connection
therewith relating to the Purchased Assets, the Equity Interests, the Business
or the Company (“Lender Liens”), and all obligations (including guarantee
obligations) of the Company in respect of such indebtedness (“Loan
Obligations”), substantially simultaneously with the Closing Date. Promptly
after the Effective Date, Parent and Sellers shall request that the Lenders
deliver letters or similar written confirmation (each, a “Release
Confirmation”), substantially simultaneously with the Closing Date, confirming
that (a) all Lender Liens shall be, upon the Closing Date, released by all
lenders thereunder and (b) all Loan Obligations shall be, upon the Closing Date,
released. Parent and Sellers shall keep Buyer reasonably informed (orally and in
writing) on a current basis regarding any material developments relating to
their request for Release Confirmations, including by reporting any
conversations with a Lender or its Representatives relating to the Release
Confirmations, any rejection of a Release Confirmation by a Lender or any
failure of a Lender to respond to a request for a Release Confirmation, and by
furnishing copies of any relevant written correspondence or draft documentation.

 

Section 9.21           Financing. Prior to the Closing, Buyer will use its
reasonable best efforts to obtain any financing necessary to pay the Purchase
Price, the Estimated Closing Payment, the Estimated Operations Payment and all
fees and expenses necessary or related to the consummation of the transactions
contemplated by this Agreement. Parent, Sellers and the Company shall provide
all cooperation reasonably requested by Buyer in connection with obtaining any
such financing, including furnishing financial and other pertinent information
necessary to show the pro forma impact of the transactions contemplated by this
Agreement on Buyer and its Subsidiaries; provided that Buyer shall be reimbursed
for any reasonable out-of-pocket costs incurred by the Company in connection
with such cooperation.

 

ARTICLE X.

CONDITIONS TO CLOSING

 

Section 10.1           Conditions to Each Party’s Obligation to Effect the
Closing. The respective obligations of each party to this Agreement to effect
the Closing shall be subject to the

 

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satisfaction of each of the following conditions on or prior to the Closing, any
of which may be waived in whole or in part in a writing executed by all of the
parties hereto:

 

(a)           No Injunctions. No Governmental Entity of competent jurisdiction
shall have enacted, issued, promulgated, enforced or entered any order,
executive order, stay, decree, judgment or injunction or statute, rule or
regulation which is in effect (whether temporary, preliminary or permanent) and
which prevents or prohibits the consummation of, or that makes it illegal for
either party hereto to consummate, the transactions contemplated by this
Agreement.

 

(b)           HSR Act. Any applicable waiting periods, together with any
extensions thereof, under the HSR Act shall have expired or been terminated.

 

Section 10.2           Additional Conditions to Obligations of Buyer. The
obligation of Buyer to effect the Closing is subject to the satisfaction of each
of the following conditions prior to the Closing, any of which may be waived in
whole or in part in writing exclusively by Buyer; provided, however, that Buyer
may not waive the condition set forth in Section 10.2(d) below until the date
this is eleven (11) months from the Effective Date and in the event such
condition is waived, Buyer agrees not to operate the Casino until such time as
all Required Governmental Consents are obtained by Buyer:

 

(a)           Representations and Warranties. (i) The representations and
warranties of Parent, Sellers and the Company contained in Sections 6.1
(Organization of Parent and Sellers), 6.2 (Authority; No Conflict; Required
Filings and Consents), 6.3 (Title to Equity Interests), 7.1 (Organization of the
Company; Capitalization) and 7.2 (Authority; No Conflict; Required Filings and
Consents) shall be true and correct in all material respects at and as of the
Closing as if made at and as of such time and (ii) all of the other
representations and warranties of Parent, Sellers and the Company contained in
this Agreement shall be true and correct (without giving effect to any
limitation as to “materiality” or “Company Material Adverse Effect” set forth
therein) at and as of the Closing as if made at and as of such time (except to
the extent expressly made as of an earlier date, in which case as of such
earlier date), except where the failure of such representations and warranties
to be true and correct would not, individually or in the aggregate, reasonably
be expected to result in a Company Material Adverse Effect. Buyer shall have
received a certificate signed on behalf of the Company by an officer of Sellers
to such effect.

 

(b)           Performance of Obligations of Parent, Sellers and the Company.
Parent, Sellers and the Company shall have performed in all material respects
all covenants, agreements and obligations required to be performed by Parent,
Sellers and the Company under this Agreement at or prior to the Closing,
including delivery of items listed in Section 5.2 hereof and curing Monetary
Defects in accordance with Article XIII hereof. Buyer shall have received a
certificate signed on behalf of Sellers by an officer of Sellers and the Company
to such effect.

 

(c)           Deliverables. Sellers and the Company shall have delivered
executed copies of the Ancillary Agreements and other closing deliverables
described in ARTICLE V to be delivered by them.

 

(d)           Governmental Consents. All consents, approvals, findings of
suitability, licenses, permits, waivers, orders or authorizations of and
registrations, declarations or filings with any Governmental Entity of competent
jurisdiction in respect of the Gaming Laws required or necessary in connection
with the transactions contemplated by this Agreement and necessary

 

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for ownership and operation of the Real Property and the Business (including
approval of the Petition for Change in Control and the approval, licensing or
registration of Buyer and such of its (i) officers, executive directors, key
employees or Persons performing management functions similar to officers,
(ii) shareholders and (iii) key business affiliates as may be required by
applicable Gaming Authorities) (the “Required Governmental Consents”) have been
obtained by Buyer and shall be in full force and effect by Buyer.

 

Section 10.3           Additional Conditions to Obligations of Sellers. The
obligations of Sellers to effect the Closing are subject to the satisfaction of
each of the following conditions prior to the Closing, any of which may be
waived in whole or in part in writing exclusively by Sellers:

 

(a)           Representations and Warranties. (i) The representations and
warranties of Buyer contained in Sections 8.1 (Organization) and 8.2 (Authority;
No Conflict; Required Filings and Consents) shall be true and correct in all
material respects at and as of the Closing as if made at and as of such time and
(iii) all of the other representations and warranties of Buyer contained in this
Agreement shall be true and correct (without giving effect to any limitation as
to “materiality” or “Buyer Material Adverse Effect” set forth therein) at and as
of the Closing as if made at and as of such time, except where the failure of
such representations and warranties to be true and correct would not,
individually or in the aggregate, reasonably be expected to result in a Buyer
Material Adverse Effect. Sellers shall have received a certificate signed on
behalf of Buyer by an executive officer of Buyer to such effect.

 

(b)           Performance of Obligations of Buyer. Buyer shall have performed in
all material respects all covenants, agreements and obligations required to be
performed by it under this Agreement at or prior to the Closing, including
delivery of items listed in Section 5.2. Sellers shall have received a
certificate signed on behalf of Buyer by an executive officer of Buyer to such
effect.

 

(c)           Deliverables. Buyer shall have delivered executed copies of the
Ancillary Agreements and other closing deliverables described in ARTICLE V to be
delivered by it.

 

ARTICLE XI.

TERMINATION AND AMENDMENT

 

Section 11.1           Termination. This Agreement may be terminated at any time
prior to the Closing (with respect to Sections 11.1(b) through (g) hereof, by
written notice by the terminating party to the other parties):

 

(a)           by mutual written agreement of Sellers and Buyer;

 

(b)           by Sellers or Buyer, if the transactions contemplated hereby shall
not have been consummated on or prior to the Outside Date; provided, however,
that the right to terminate this Agreement under this Section 11.1(b) shall not
be available to Sellers or Buyer, respectively, if Sellers’ (or Parent’s or the
Company’s) or Buyer’s failure, respectively, to fulfill any obligation of
Sellers (or Parent or the Company) or Buyer, respectively, under this Agreement
has been the primary cause of the failure of the Closing to occur on or before
the Outside Date;

 

(c)           by Sellers or Buyer, if any Gaming Authority made a final,
non-appealable determination that such Gaming Authority will not issue to Buyer
all Gaming Approvals;

 

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(d)           by Sellers or Buyer, if a court of competent jurisdiction or other
Governmental Entity shall have issued a non-appealable final order, decree or
ruling or taken any other non-appealable final action, in each case, having the
effect of permanently restraining, enjoining or otherwise prohibiting the
Closing and the transactions contemplated hereby; provided, however, that the
right to terminate this Agreement under this Section 11.1(d) shall not be
available to Sellers or Buyer, respectively, if Sellers’ (or Parent’s or the
Company’s) or Buyer’s failure, respectively, to fulfill any obligation of
Sellers (or Parent or the Company) or Buyer, respectively, under this Agreement
has been the primary cause of, or materially contributed to, such action;

 

(e)           by Buyer, if the Company, Sellers or Parent have breached any
representation, warranty, covenant or agreement on the part of the Company,
Sellers or Parent set forth in this Agreement which (i) would result in a
failure of a condition set forth in Sections 10.1(a) or (b) or Sections 10.2(a),
(b), (c) or (d) hereof and (ii) is not cured within thirty (30) calendar days
after written notice thereof; provided, however, that if such breach cannot
reasonably be cured within such thirty (30) day period but can be reasonably
cured prior to the Outside Date, and the Company, Sellers and Parent are
diligently proceeding to cure such breach, this Agreement may not be terminated
pursuant to this Section 11.1(e); provided, further, that Buyer’s right to
terminate this Agreement under this Section 11.1(e) shall not be available if,
at the time of such intended termination, Sellers have the right to terminate
this Agreement under Section 11.1(b), (c), (d) or (f) hereof;

 

(f)            by Sellers, if Buyer has breached any representation, warranty,
covenant or agreement on the part of Buyer set forth in this Agreement which
(i) would result in a failure of a condition set forth in Sections 10.1(a) or
(b) or Section 10.3(a), (b) or (c) hereof and (ii) is not cured within thirty
(30) calendar days after written notice thereof; provided, however, that if such
breach cannot reasonably be cured within such thirty (30) day period but can be
reasonably cured prior to the Outside Date, and Buyer is diligently proceeding
to cure such breach, this Agreement may not be terminated pursuant to this
Section 11.1(f); provided, further, that Buyer shall have no right to cure its
failure to timely make any Extension Deposit and such failure shall result in an
immediate right of Sellers to terminate hereunder; provided, further, that
Sellers’ right to terminate this Agreement under this Section 11.1(f) shall not
be available if, at the time of such intended termination, Buyer has the right
to terminate this Agreement under Section 11.1(b), (c), (d) or (e) hereof; or

 

(g)           by Buyer, pursuant to Section 13.2(b) or 13.3.

 

Section 11.2           Effect of Termination.

 

(a)           Liability. In the event of termination of this Agreement as
provided in Section 11.1 hereof, this Agreement shall immediately become void
and there shall be no Liability on the part of Buyer or Sellers, or their
respective Affiliates or Representatives, other than Sections 1.5, 9.5(b) and
11.2 and ARTICLE XIII hereof; provided, however, that nothing contained in this
Section 11.2 shall relieve or limit the Liability of either party to this
Agreement for any fraudulent or willful breach of this Agreement.

 

(b)           Fees and Expenses. Except as otherwise expressly provided in this
Agreement, all fees and expenses incurred in connection with this Agreement and
the

 

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transactions contemplated hereby shall be paid by the party incurring such
expenses, whether or not the Closing is consummated. Any cancellation charges of
the Escrow Agent or Title Insurer shall be paid by the party who breached this
Agreement, and, if no party breached this Agreement, then each of Sellers and
Buyer shall pay one-half of such cancellation charges.

 

(c)           Application of the Deposit and any Extension Deposit.

 

(i)            Upon the termination of this Agreement pursuant to
Section 11.1(e) and (g) hereof, the Deposit and any Extension Deposit, together
with interest earned thereon, shall be paid to Buyer.

 

(ii)           Upon the termination of this Agreement for any reason other than
pursuant to Section 11.1(e) and (g) hereof, the Deposit and any Extension
Deposit, together with any interest earned thereon, shall be paid to Sellers (or
their designee).

 

(d)           Certain Terminations. In the event that (w) this Agreement is
terminated pursuant to Section 11.1(b) or (c), (x) one or more Required
Governmental Consents has not been obtained at or prior to the time of such
termination, (y) all of the condition to Buyer’s obligation to effect the
Closing set forth in Sections 10.1(a) or (b) and Sections 10.2(a), (b), (c) and
(d) have been satisfied, or waived by Buyer, other than those conditions that
are not satisfied because of the failure to obtain such Required Governmental
Consent(s) and (z) any action announced, entered into or commenced by Buyer
after the Effective Date (a “Buyer Corporate Transaction”) was a material cause
of the failure to obtain such Required Governmental Consent(s) prior to the
termination date, then, within three (3) business days of the consummation by
Sellers of any Company Sale pursuant to a binding arms length agreement with a
non-affiliated third party purchaser (the “Third Party Purchaser”) entered into
within twelve (12) months of such termination date (a “New Sale Agreement”),
Buyer shall pay to Sellers the amount, if any, by which (i) the Purchase Price
less the amount of the Deposit and any Extension Deposit previously released to
Sellers pursuant to Section 11.2(c) exceeds (ii) the New Sale Price (the
“Make-Whole Amount”); provided, that, if Sellers and/or the Company enter into a
New Sale Agreement, they shall use all reasonable best efforts to maximize the
New Sale Price and shall permit Buyer to participate on the same process as all
other bidders in the sales process seeking a Third Party Purchaser; provided,
however, that prior to entry into a New Sale Agreement, Sellers and the Company
may use its good faith judgment to determine the most favorable Company Sale
proposal, considering all legal, regulatory and financial aspects (including
certainty of closing). In the event of a termination of this Agreement of the
type described in the first sentence of this Section 11.2(d), there shall be no
Liability on the part of Buyer or its Affiliates or Representatives other than
payment of the Make-Whole Amount (if any) pursuant to this Section 11.2(d), and
as set forth in Section 11.2(c); provided, however, that nothing contained in
this Section 11.2(d) shall relieve or limit the Liability of Buyer for any
fraudulent or willful breach of this Agreement. For the avoidance of doubt, the
parties acknowledge and agree that this Section 11.2(d) does not limit Buyer’s
obligations pursuant to Section 9.13 hereof and does not restrict Buyer’s
ability to engage in a Buyer Corporate Transaction.

 

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ARTICLE XII.

SURVIVAL; INDEMNIFICATION

 

Section 12.1           Survival of Representations, Warranties, Covenants and
Agreements.

 

(a)           Except as set forth in ARTICLE XI and Section 12.1(b) hereof, the
representations, warranties, covenants and agreements of each party hereto shall
remain operative and in full force and effect regardless of any investigation
made by or on behalf of any other party hereto, any Person controlling any such
party or any of their Representatives whether prior to or after the execution of
this Agreement.

 

(b)           The representations and warranties made by Parent, Sellers, the
Company and Buyer in this Agreement shall survive the Closing until (and claims
based upon or arising out of such representations and warranties may be asserted
at any time before) six (6) months after the Closing Date, provided, however,
that the representations made in Sections 6.1 (Organization of Sellers), 6.2
(Authority; No Conflict; Required Filings and Consents), 6.3 (Title to Equity
Interests), 7.1 (Organization of the Company), 7.2 (Authority; No Conflict;
Required Filings and Consents), 7.14 (Brokers), 7.17 (Minimum Cash), 8.1
(Organization), 8.2 (Authority; No Conflict; Required Filings and Consents), 8.3
(Brokers) (collectively, the “Fundamental Representations”) shall survive
indefinitely, and the representations and warranties in Section 7.5 (Tax) shall
survive until sixty (60) days following the expiration of the statute of
limitations (taking into account any extensions or waivers thereof) applicable
to the collection of the applicable Tax that is the subject of such
representations. The period of time a representation or warranty survives the
Closing pursuant to the preceding sentence shall be the “Survival Period” with
respect to such representation or warranty. The parties intend for the preceding
two sentences to shorten the otherwise applicable statute of limitations and
agree that, subject to the last sentence of this Section 12.1(b), no claim may
be brought based upon, directly or indirectly, any of the representations and
warranties contained in this Agreement after the Survival Period with respect to
such representation or warranty. The covenants and agreements of the parties
hereto in this Agreement shall survive the Closing without any contractual
limitation on the period of survival (other than those covenants and agreements
that are expressly required to remain in full force and effect for a specified
period of time). The termination of the representations and warranties provided
herein shall not affect a party (i) in respect of any claim made by such party
in reasonable detail in writing received by an Indemnifying Party prior to the
expiration of the applicable Survival Period provided herein, or (ii) in respect
of any claim grounded in fraud or willful misconduct of the Indemnifying Party.

 

Section 12.2           Indemnification.

 

(a)           Except with respect to Taxes that are governed by Section 12.2(d),
from and after the Closing, Parent and Sellers shall indemnify, save and hold
harmless Buyer and its Affiliates and its and their respective Representatives,
successors and assigns (each, a “Buyer Indemnified Party” and collectively, the
“Buyer Indemnified Parties”) from and against any and all costs, losses, Taxes,
Liabilities, obligations, damages, claims, demands and expenses (whether or not
arising out of third-party claims), including interest, penalties, reasonable
attorneys’ fees and all amounts paid in investigation, defense or settlement of
any of the foregoing (herein, “Damages”), incurred in connection with, arising
out of, or resulting from:

 

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(i)            any breach of any representation or warranty other than a
Fundamental Representation made by Parent, Sellers or the Company in this
Agreement;

 

(ii)           any breach of Fundamental Representation made by Parent, Sellers
or the Company in this Agreement;

 

(iii)          any breach of any covenant (excluding any Damages incurred in
connection with, arising out of, or resulting from a breach of Section 9.1(p) 
that have been reflected in Net Working Capital) or agreement made, or to be
performed, by Parent, Sellers or the Company in this Agreement;

 

(iv)          the Excluded Liabilities;

 

(v)           the Excluded Assets; or

 

(vi)          the ownership, use, registration, maintenance, licensing or
previous transfer of the Purchased Assets prior to the Closing or the conduct of
the Business prior to the Closing.

 

(b)           Except with respect to Taxes that are governed by Section 12.2(d),
from and after the Closing, Buyer shall indemnify, save and hold harmless
Sellers, the Company and their respective Affiliates and its and their
Representatives, successors and (each, a “Seller Indemnified Party” and
collectively, the “Seller Indemnified Parties”) from and against any and all
Damages incurred in connection with, arising out of, or resulting from:

 

(i)            any breach of any representation or warranty other than a
Fundamental Representation made by Buyer in this Agreement;

 

(ii)           any breach of Fundamental Representation made by Buyer in this
Agreement;

 

(iii)          any breach of any covenant or agreement made, or to be performed,
by Buyer in this Agreement;

 

(iv)          the Assumed Liabilities;

 

(v)           the Purchased Assets; or

 

(vi)          the ownership, use, registration, maintenance, licensing or
further transfer of the Purchased Assets after the Closing or the conduct of the
Business after the Closing.

 

(c)           Interpretation.  Notwithstanding anything in this Agreement to the
contrary, the term Damages shall not include any consequential, special or
incidental damages, claims for lost profits, or punitive or similar damages,
except in cases where such damages are recovered from an Indemnified Party by a
third party.

 

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(d)           Tax Indemnification.

 

(i)            From and after the Closing, Sellers shall indemnify, save and
hold harmless the Buyer Indemnified Parties from and against any and all Damages
incurred in connection with, arising out of, or resulting from: (A) any breach
of any representation or warranty contained in Section 7.5  (Taxes); (B) any
breach of any covenant or agreement made, or to be performed by Parent, Sellers
or the Company on or prior to the Closing Date, pursuant to Section 3.3,
Section 9.1(s), Section 9.9(a) and Section 12.9;  and (C) any Excluded Taxes.

 

(ii)           From and after the Closing, Buyer shall indemnify, save and hold
harmless the Seller Indemnified Parties from and against any and all Damages
incurred in connection with, arising out of, or resulting from: (A) any breach
of any covenant or agreement made, or to be performed by Buyer, pursuant to
Section 3.3, Section 9.9(a)  and Section 12.9;  and (B) any Taxes of the Company
or relating to the Purchased Assets for any Post-Closing Period; in each case,
other than Taxes for which Sellers are responsible pursuant to
Section 12.2(d)(i).

 

Section 12.3           Procedure for Claims between Parties. Except with respect
to Taxes that are governed by Section 12.2(d), if a claim for Damages is to be
made by a Buyer Indemnified Party or Seller Indemnified Party (each, an
“Indemnified Party”  and collectively, the “Indemnified Parties”)  entitled to
indemnification hereunder, such party shall give written notice briefly
describing the claim and, to the extent then ascertainable, the monetary damages
sought (each, a “Notice”)  to the indemnifying party hereunder (the
“Indemnifying Party” and collectively, the “Indemnifying Parties”)  as soon as
reasonably practicable after such Indemnified Party becomes aware of any fact,
condition or event which may give rise to Damages for which indemnification may
be sought under this ARTICLE XII. Any failure to submit any such notice of claim
to the Indemnifying Party shall not relieve any Indemnifying Party of any
Liability hereunder, except to the extent that the Indemnifying Party was
actually prejudiced by such failure.

 

Section 12.4           Defense of Third Party Claims.

 

(a)           Except with respect to Taxes that are governed by Section 12.2(d),
if any lawsuit, action, proceeding, investigation, claim or enforcement action
is initiated against an Indemnified Party by any third party (each, a “Third
Party Claim”)  for which indemnification under this ARTICLE XII may be sought,
Notice thereof, together with copies of all notices and communication relating
to such Third Party Claim, shall be given to the Indemnifying Party as promptly
as reasonably practicable. The failure of any Indemnified Party to give timely
Notice hereunder shall not affect rights to indemnification hereunder, except to
the extent that the Indemnifying Party was actually prejudiced by such failure.

 

(b)           If it so elects at its own cost, risk and expense, the
Indemnifying Party shall be entitled to:

 

(i)            take control of the defense and investigation of such Third Party
Claim at its sole cost and expense if the Indemnifying Party notifies the
Indemnified Party in writing that the Indemnifying Party will indemnify the
Indemnified Party for any Damages related to the Third Party Claim;

 

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(ii)           employ and engage attorneys of its own choice (provided that such
attorneys are reasonably acceptable to the Indemnified Party) to handle and
defend the same, unless the named parties to such action or proceeding include
both one or more Indemnifying Parties and an Indemnified Party, and the
Indemnified Party has reasonably concluded that there may be one or more legal
defenses or defense strategies available to such Indemnified Party that are
different from or additional to those available to an applicable Indemnifying
Party or that there exists or is reasonably likely to exist a conflict of
interest, in which event such Indemnified Party shall be entitled, at the
Indemnifying Parties’ reasonable cost, risk and expense, to separate counsel
(provided that such counsel is reasonably acceptable to the Indemnifying Party);
and

 

(iii)          compromise or settle such Third Party Claim, which compromise or
settlement shall be made (x) only with the written consent of the Indemnified
Party, such consent not to be unreasonably withheld, or (y) if such compromise
or settlement contains an unconditional release of the Indemnified Party in
respect of such claim, without any cost, liability or admission of wrongdoing of
any nature whatsoever to or by such Indemnified Party, and provides only for
monetary damages that will be paid in full by the Indemnifying Party.

 

(c)           If the Indemnifying Party elects to assume the defense of a Third
Party Claim, the Indemnified Party shall cooperate in all reasonable respects
with the Indemnifying Party and its attorneys in the investigation, trial and
defense of such Third Party Claim and any appeal arising therefrom; provided,
however, that the Indemnified Party may, at its own cost, participate in the
investigation, trial and defense of such lawsuit or action and any appeal
arising therefrom. The parties shall cooperate with each other in any
notifications to insurers.

 

(d)           If the Indemnifying Party fails to assume the defense of such
Third Party Claim within fifteen (15) calendar days after receipt of the Notice,
the Indemnified Party against which such Third Party Claim has been asserted
will have the right to undertake, at the Indemnifying Parties’ reasonable cost,
risk and expense, the defense, compromise or settlement of such Third Party
Claim on behalf of and for the account and risk of the Indemnifying Parties;
provided, however, that such Third Party Claim shall not be compromised or
settled without the written consent of the Indemnifying Party, which consent
shall not be unreasonably withheld.

 

(e)           If the Indemnified Party assumes the defense of the Third Party
Claim, the Indemnified Party will keep the Indemnifying Party reasonably
informed of the progress of any such defense, compromise or settlement.

 

(f)            If the Indemnifying Party notifies the Indemnified Party that it
does not dispute its liability to the Indemnified Party with respect to the
Third Party Claim or fails to notify the Indemnified Party whether the
Indemnifying Party disputes its liability to the Indemnified Party with respect
to such Third Party Claim within sixty (60) days of the Notice of such Third
Party Claim having been provided to the Indemnifying Party, the Damages arising
from such Third Party Claim will be conclusively deemed a liability of the
Indemnifying Party and the Indemnifying Party shall pay the amount of such
Damages to the Indemnified Party on demand following the final determination
thereof. If the Indemnifying Party disputes its liability with respect to such
claim within such 60-day period, then such dispute shall be resolved in
accordance with the terms and conditions of Section 12.5.

 

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(g)           This Section 12.4 shall not apply to any claim with respect to
Taxes that are governed by Section 12.2(d), which shall be governed exclusively
by Section 12.9(c).

 

Section 12.5           Resolution of Conflicts and Claims.

 

(a)           If the Indemnifying Party objects in writing to any claim for
indemnification made by an Indemnified Party in any written Notice of a claim
(an “Objection Notice”), Sellers, on the one hand, and Buyer, on the other hand,
shall attempt in good faith to agree upon the rights of the respective parties
with respect to each of such claims, and such Sellers and Buyer shall provide
information to the other party (as reasonably requested) related to the issues
set forth in the Objection Notice. If Sellers and Buyer should so agree, a
memorandum setting forth such agreement shall be prepared and signed by both
parties.

 

(b)           If no such agreement is reached after good faith negotiation,
either Buyer or Sellers may demand mediation of the dispute, unless the amount
of the damage or loss is at issue in a pending action or proceeding involving a
Third Party Claim, in which event mediation shall not be commenced until such
amount is ascertained or both parties agree to mediation. In any such mediation,
Buyer and Sellers agree to employ a mediator from the American Arbitration
Association (the “AAA”) to assist them in reaching resolution of such dispute
according to the Commercial Mediation Rules of the AAA. The mediator shall be a
corporate attorney with at least fifteen (15) years experience in acquisitions.
The fees and expenses of the mediator shall be shared equally by Buyer and
Sellers. If, after mediation efforts, Buyer and Sellers should agree as to all
or a portion of a claim, a memorandum setting forth such agreement shall be
prepared and signed by both parties. If after reasonable efforts, and over a
period of sixty (60) calendar days, the parties are unable to reach agreement on
such dispute utilizing the mediator, the parties shall be permitted to proceed
with any legal remedy available to such party.

 

(c)           The provisions of this Section 12.5 shall apply to disputes
between the parties as to Tax matters subject to Section 12.9, with the term
“Third Party Claim” replaced with “Tax Claim”.

 

Section 12.6           Limitations on Indemnity.

 

(a)           No Buyer Indemnified Party shall seek, or be entitled to,
indemnification from any of the Indemnifying Parties pursuant to
Section 12.2(a)(i) hereof to the extent the aggregate claims for Damages of the
Buyer Indemnified Parties for which indemnification is sought pursuant to
Section 12.2(a)(i) hereof are less than six million one-hundred thousand dollars
($6,100,000) (the “Deductible”) or exceed an amount equal to thirty million
five-hundred thousand dollars ($30,500,000) (the “Cap”); provided, that, if the
aggregate of all claims for Damages for which indemnification is sought pursuant
to Section 12.2(a)(i) hereof equals or exceeds the Deductible, then the Buyer
Indemnified Parties shall be entitled to recover for such Damages, subject to
the limitations in this Section 12.6(a), only to the extent such Damages exceed
the Deductible, but in any event not to exceed the Cap.

 

(b)           In addition to the limitations set forth in Section 12.6(a), no
Buyer Indemnified Party shall seek, or be entitled to, indemnification from any
of the Indemnifying Parties pursuant to Section 12.2(a)(i) hereof to the extent
any individual claim or series of related individual claims for Damages of the
Buyer Indemnified Parties for which indemnification is sought pursuant to
Section 12.2(a)(i) hereof is less than $100,000, at which time, subject to the

 

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limitation set forth herein, the Buyer Indemnified Party shall be entitled to
indemnification for the full amount of all such Damages from and including the
first dollar of such Damages and all such Damages shall count towards the
satisfaction of the Deductible.

 

(c)           In calculating the amount of any Damages payable to a Buyer
Indemnified Party or a Seller Indemnified Party hereunder, the amount of the
Damages (i) shall not be duplicative of any other Damage for which an
indemnification claim has been made and (ii) shall be computed net of any
amounts actually recovered by such Indemnified Party under any insurance policy
with respect to such Damages (net of any costs and expenses incurred in
obtaining such insurance proceeds). If an Indemnifying Party pays an Indemnified
Party for a claim and subsequently insurance proceeds in respect of such claim
is collected by the Indemnified Parties, then the Indemnified Party promptly
shall remit the insurance proceeds (net of any costs and expenses incurred in
obtaining such insurance proceeds) up to the amount paid by Indemnifying Party
to Indemnifying Party. The Indemnified Parties shall use commercially reasonable
efforts to obtain from any applicable insurance company any insurance proceeds
in respect of any claim for which the Indemnified Parties seek indemnification
under this ARTICLE XII.

 

Section 12.7           Payment of Damages. Except as otherwise permitted in
Section 12.9(a), an Indemnified Party shall be paid in cash by an Indemnifying
Party the amount to which such Indemnified Party may become entitled by reason
of the provisions of this ARTICLE XII, within ten (10) business days after such
amount is determined either by mutual agreement of the parties or on the date on
which both such amount and an Indemnified Party’s obligation to pay such amount
have been determined by a final judgment of a court or administrative body
having jurisdiction over such proceeding.

 

Section 12.8           Exclusive Remedy.

 

(a)           After the Closing, the indemnities provided in this ARTICLE XII
shall constitute the sole and exclusive remedy of any Indemnified Party for
Damages arising out of, resulting from or incurred in connection with any claims
regarding matters arising under or otherwise relating to this Agreement;
provided, however; that this exclusive remedy for Damages does not preclude a
party from bringing an action for specific performance or other equitable remedy
to require a party to perform its obligations under this Agreement. Without
limiting the foregoing, Buyer, Parent and Sellers each hereby waive (and, by
their acceptance of the benefits under this Agreement, each Buyer Indemnified
Party and Seller Indemnified Party hereby waives), from and after the Closing,
any and all rights, claims and causes of action (other than claims of, or causes
of action arising from, fraud or willful misconduct) such party may have against
the other party arising under or based upon this Agreement or any schedule,
exhibit, disclosure letter, document or certificate delivered in connection
herewith, and no legal action sounding in tort, statute or strict liability may
be maintained by any party (other than a legal action brought solely to enforce
or pursuant to the provisions of this ARTICLE XII). Notwithstanding anything to
the contrary in this Section 12.8, in the event of willful misconduct, or a
fraudulent breach of the representations, warranties, covenants or agreements
contained herein, by Buyer, Parent or Sellers, any Indemnified Party shall have
all remedies available at law or in equity (including for tort) with respect
thereto.

 

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(b)           Without limiting the foregoing, the Buyer Indemnified Parties and
the Seller Indemnified Parties hereby waive and agree not to seek (whether under
any Environmental Law or otherwise) any statutory or common law remedy (whether
for contribution, equitable indemnity or otherwise) against any Indemnifying
Party with regard to any Environmental Condition or Environmental Liability,
except solely in accordance with the exclusive remedy provided in this
ARTICLE XII.

 

Section 12.9           Tax Matters.

 

(a)           Treatment of Indemnification Payments. All indemnification
payments made pursuant to this ARTICLE XII shall be treated by the parties for
income Tax purposes as adjustments to the purchase price, unless (i) otherwise
required pursuant to a “determination” (as defined in Section 1313(a) of the
Code or any similar provision of state, local or foreign Law) or (ii) Buyer
provides Sellers with its written consent, which consent shall not be
unreasonably withheld, conditioned or delayed.

 

(b)           Tax Returns.

 

(i)            Sellers shall prepare or cause to be prepared all Tax Returns
required to be filed by, with respect to or that include the Company with
respect to taxable periods of the Company ending on or before the Closing Date
(the “Pre-Closing Separate Tax Returns”), and such Pre-Closing Separate Tax
Returns, to the extent they relate to the Company, shall be prepared consistent
with past practices and this Agreement, except as otherwise required by
applicable Law. Sellers shall file or cause to be filed all Pre-Closing Separate
Tax Returns that are required to be filed on or before the Closing Date and
Sellers shall pay, or cause to be paid, all such Taxes shown as due on such Tax
Returns. Buyer shall file or cause to be filed all Pre-Closing Separate Tax
Returns for the Company that are prepared by Sellers pursuant to the first
sentence of this Section 12.9(b)(i) that are due after the Closing Date and,
subject to the other provisions in this Agreement, shall pay or cause to be paid
all Taxes shown as due on such Pre-Closing Separate Tax Returns, provided that
neither Buyer nor the Company shall be required to sign or file any Tax Return
(i) not prepared in accordance with this Agreement or (ii) if it reasonably
determines that there is not substantial authority supporting each material
position reflected on such Tax Return (or such higher standard as may be
required under applicable state, local or foreign Law to avoid the imposition of
penalties) and, provided, further, that signing and filing a Tax Return in
accordance with the foregoing provision shall not be considered an
acknowledgement that such Tax Return complies with the requirements of this
Agreement. Sellers shall pay to Buyer no later than three (3) business days
prior to the due date for filing any Pre-Closing Separate Tax Return referenced
in the preceding sentence, the amount of Taxes shown as due on such Pre-Closing
Separate Tax Returns. Sellers shall provide Buyer a copy of each such
Pre-Closing Separate Tax Return for its review and comment a reasonable number
of days prior to the due date (including any applicable extension) of such Tax
Return, and Sellers shall reasonably consider any written comments of Buyer
received prior to filing such Pre-Closing Separate Tax Return. If the Company is
permitted under any applicable income Tax Law to treat the Closing Date as the
last day of the taxable period in which the Closing occurs, Buyer and Sellers
shall treat (and shall cause their respective Affiliates to treat) the Closing
Date as the last day of such taxable period.

 

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(ii)           Buyer shall prepare or cause to be prepared all Tax Returns of
the Company for taxable periods starting on or before the Closing Date and
ending after the Closing Date (each, a “Straddle Period”), and shall cause such
Tax Returns to be prepared consistent with past practices, except as otherwise
required by applicable Law. The Company shall file or cause to be filed all such
Tax Returns for any Straddle Period and, subject to the other provisions in this
Agreement, shall pay or cause to be paid all Taxes shown as due on such Tax
Returns. Sellers shall pay to Buyer no later than three (3) business days prior
to the due date for filing any Tax Return for any Straddle Period the amount of
Taxes owing with respect to the Straddle Period for which Sellers are
responsible pursuant to Section 12.2(d)(i). Buyer shall provide Sellers a copy
of each such Tax Return for their review and comment a reasonable number of days
prior to the due date (including any applicable extension) of such Tax Return,
and Buyer shall reasonably consider any written comments of Sellers received by
Buyer prior to filing such Tax Return.

 

(iii)          For purposes of the indemnity provisions of this Agreement, in
the case of any Taxes that are imposed on a periodic basis and are payable for a
Straddle Period, the portion of such Tax related to the portion of such Straddle
Period ending on and including the Closing Date shall (A) in the case of any
Taxes other than gross receipts, employment, sales or use Taxes, Taxes based
upon or related to income and other similar Taxes, be deemed to be the amount of
such Tax for the entire Straddle Period multiplied by a fraction the numerator
of which is the number of days in the Straddle Period ending on and including
the Closing Date and the denominator of which is the number of days in the
entire Straddle Period, and (B) in the case of any Tax based upon or related to
income and any gross receipts, employment, sales or use Tax and other similar
Taxes, be deemed equal to the amount which would be payable if the relevant Tax
period ended on and included the Closing Date.

 

(c)           Tax Contest. Buyer or Sellers, as applicable, shall promptly
notify Sellers or Buyer, as applicable, in writing upon receipt by Buyer (or,
following the Closing, the Company) or Sellers, as applicable, of a written
notice of any audit or administrative or judicial proceeding with respect to
Taxes of the Company which Sellers or Buyer, as applicable, may be responsible
for pursuant to Section 12.2(d) (a “Tax Claim”); provided, however, no failure
or delay by Buyer or Sellers, as applicable, to provide notice of a Tax Claim
shall reduce or otherwise affect the obligation of Sellers or Buyer, as
applicable, hereunder except to the extent Sellers or Buyer, as applicable, is
actually prejudiced thereby. Buyer and Sellers shall cooperate with each other
in the conduct of any Tax Claim. Sellers shall have the right to control the
conduct of any Tax Claim for a period that ends on or prior to the Closing Date
if Sellers provide Buyer with notice of its election to control such claim
within twenty (20) days of Buyer notifying Sellers of such Tax Claim. If Sellers
do not elect to control any such Tax Claim within the time period set forth
above, then Buyer shall be entitled to control all aspects of such claim. Buyer
shall control any Tax Claim for a period that begins before and ends after the
Closing Date. If the resolution of any Tax Claim for any Pre-Closing Period or
Straddle Period could reasonably be expected to have an adverse effect on the
party that is not in control of such claim, (A) the party in control of such
claim shall keep the other party reasonably informed regarding the progress and
substantive aspects of such Tax Claim, (B) the other party shall be entitled to
participate in any proceedings with respect to such Tax Claim and (C) the party
in control of such claim shall not compromise or settle any such Tax Claim
without obtaining the other party’s prior written consent, which consent shall
not be unreasonably withheld, conditioned or delayed. Notwithstanding anything
to the contrary in this Agreement, Buyer shall have the right

 

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to exclusively control the conduct of any audit or administrative or judicial
proceeding with respect to the Company for any taxable period other than a
Straddle Period beginning after the Closing Date.

 

(d)           Cooperation. Buyer and Sellers shall reasonably cooperate, as and
to the extent reasonably requested by the other party, in connection with the
filing of Tax Returns and any audit, litigation or other proceeding with respect
to Taxes of the Company. Such cooperation shall include the retention and (upon
the other party’s request, provided that the other party provides reimbursement
for all reasonable out of pocket expenses) the provision of records and
information reasonably relevant to any such audit, litigation or other
proceeding and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided
hereunder. Each of Buyer and Sellers shall (i) retain all books and records in
its (or its Affiliate’s) possession after the Closing with respect to Tax
matters pertinent to the Company relating to any taxable period beginning before
the Closing Date until expiration of the statute of limitations (taking into
account any extensions thereof) of the respective taxable periods and (ii) give
the other party reasonable written notice prior to transferring, destroying or
discarding any such books and records and, if the other party so requests, shall
allow the requesting party to take possession of such books and records.

 

(e)           Certain Actions After Closing. Neither Buyer nor any of its
Affiliates (including, after the Closing, the Company) shall, without the prior
written consent of Sellers (such consent not to be unreasonably withheld,
conditioned or delayed), (i) make or change any (A) Tax election of the Company
for a taxable period (or portion thereof) ending on or before the Closing Date
or (B) property Tax election of the Company affecting the Tax Claim described in
Section 7.5(b)(i) of the Company Disclosure Letter in respect of certain
property Taxes of the Company for the 2011 taxable period, (ii) amend, refile or
otherwise modify (or grant an extension of any applicable statute of limitations
with respect to) any Tax Return of the Company for a taxable period (or portion
thereof) ending on or before the Closing Date, or (iii) cause the Company to
engage in any transaction on the Closing Date after the Closing that is outside
of the ordinary course of business, except for the transactions contemplated by
this Agreement; in each case, except for any action that would not, individually
or in the aggregate, have an adverse effect on Sellers or any of their
Affiliates (including, with respect to a taxable period (or portion thereof)
ending on or before the Closing Date, the Company) that is material.

 

(f)            Tax Sharing Agreements. Any and all existing Tax sharing or
similar agreements between Sellers or any of their Affiliates, on the one hand,
and the Company, on the other hand, shall be terminated and all payables and
receivables arising thereunder shall be settled, in each case prior to the
Closing Date. After the Closing, neither Buyer nor the Company shall have any
further rights or liabilities thereunder.

 

(g)           Tax Refunds. Sellers shall be entitled to any refund (whether by
way of payment or reduction in Taxes otherwise payable in cash) received by
Buyer or the Company of Taxes constituting an Excluded Liability; provided,
however, that Sellers shall not be entitled to any refund of Taxes to the extent
that such refund is attributable to the carryback of a loss or other Tax
attribute arising in a Post-Closing Period. Except as provided in the foregoing
sentence, Buyer shall be entitled to any other refund of or with respect to the
Company or with respect to Transfer Taxes paid by Buyer pursuant to
Section 9.9(a). If any party receives a refund to which another party is
entitled pursuant to this Section 12.9(g), such party shall pay

 

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over such refund (net of costs or Taxes to the party receiving such refund) to
the party entitled to such refund no later than ten (10) business days following
receipt of such refund.

 

ARTICLE XIII.

TITLE TO REAL PROPERTY

 

Section 13.1           Title Policy and UCC Search. Buyer has obtained the Title
Commitment and agrees to accept the Title Policy delivered by the Company on or
immediately prior to the date hereof and the Uniform Commercial Code search of
Sellers dated as of April 25, 2012 (the “UCC Search”). Buyer hereby acknowledges
receipt of the Title Commitment, Title Policy and the UCC Search as evidence of
the status of the Company’s title to the Purchased Assets and acceptance of the
matters thereon as Permitted Liens. Buyer agrees to accept valid and insurable
(at ordinary rates) fee simple title to the Real Property subject to the
Permitted Liens and Permitted Encumbrances. Buyer shall have the option upon the
Closing Date to purchase a date-down endorsement to the Title Policy (or, at
Buyer’s option, a new title insurance policy) together with a non-imputation
endorsement (if available) (the “Endorsement”), insuring that the Company is the
owner of the Real Property described in the Title Policy, subject to the
exceptions set forth in the Endorsement. Buyer shall pay the premium for the
Endorsement.

 

Section 13.2           Defects Arising After the Effective Date.

 

(a)           The UCC Search shall be updated by the Company not earlier than
thirty (30) days and not later than ten (10) days prior to the Closing Date. The
Endorsement, if Buyer elects to obtain such Endorsement, shall be updated by
Buyer not earlier than thirty (30) days and not later than ten (10) days prior
to the Closing Date. If the updated UCC Search and/or Endorsement, if
applicable, discloses defects in title not shown by (i) the applicable Title
Policy, (ii) UCC Search, (iii) the Company Disclosure Letter, (iv) the Title
Commitment or (v) this Agreement which, in any case, render fee simple title to
the Real Property uninsurable (at ordinary rates) (“Non-Monetary Defects”), or,
if the Real Property should become subject to a Monetary Defect (together with
any Non-Monetary Defects, “Additional Exceptions”), Buyer may object to such
Additional Exceptions by delivering to the Company an itemized written notice of
Buyer’s objection to such Additional Exceptions (“Defect Notice”) within fifteen
(15) days after the date of receipt by Buyer of the updated Endorsement, if
applicable, or UCC Search or, if earlier, the Closing Date (the “Notice
Period”). Additional Exceptions will not be deemed to include any Permitted
Liens or Permitted Encumbrances. Buyer’s failure to deliver a Defect Notice
during the Notice Period shall be deemed a waiver of Buyer’s right to object to
such Defect(s), and Buyer shall then accept such title as is described in the
Endorsement and UCC Search, as updated, without reserving any claim against the
Company for such Defect(s); provided that such a failure shall not limit any
claim that Buyer may have with respect to a breach of the Company’s obligations
pursuant to Section 9.1(d) hereof).

 

(b)           If Buyer provides a Defect Notice to the Company during the Notice
Period, the Company shall have five (5) days after receipt of the Defect Notice
within which to give written notice to Buyer as to whether the Company will
elect to cure any Additional Exceptions. The Company shall be under no
obligation to remove any Additional Exceptions that are not Monetary Defects
(and that are not created as a consequence of a breach of the Company’s
obligations pursuant to Section 9.1(d) hereof), and any refusal of the Company
to do so shall not be a default of the Company under this Agreement. Failure to
notify Buyer in

 

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writing within such period of the Company’s election shall be deemed the
Company’s election not to cure any such Additional Exceptions. If the Company
elects, in its sole discretion, to cure any Additional Exceptions, the Company
shall have thirty (30) days after receipt of the Defect Notice to cure such
Additional Exceptions which Company has elected to cure, and the Closing shall,
if necessary, be extended accordingly. Buyer shall have five (5) business days
following either receipt of the Company’s notice electing not to cure any
Additional Exceptions or the date on which the Company is deemed to have elected
not to cure any Additional Exceptions in which to elect (in each case, without
limitation to any claim that Buyer may have with respect to a breach of the
Company’s obligations pursuant to Section 9.1(d) hereof) either to (i) waive its
objection to the Additional Exceptions that the Company does not or is deemed
not to elect to cure and to proceed with Closing; or (ii) terminate this
Agreement upon written notice to the Company and Escrow Agent. The Company shall
be obligated to cure Monetary Defects in accordance with Section 13.2(c).

 

(c)           The Company shall be obligated to cure monetary Liens encumbering
the Real Property (other than any non-delinquent Taxes and assessments and any
monetary Liens created or suffered by Buyer or consented to by Buyer), including
financing liens or encumbrances created by, under or through or the Company or
that are held by the Company or any of its Affiliates (“Monetary Defects”) in
the manner provided below. In order to cure a Monetary Defect, or any Additional
Exception that the Company elects to cure in accordance with this Article XIII,
the Company shall have the option to extend the Closing Date for a period of
thirty (30) days, by giving written notice of such extension election to Buyer
and Escrow Agent on or prior to the Closing Date. The Company may cure Monetary
Defects, and any Additional Exceptions that the Company elects to cure, by any
of the following methods to the extent applicable: (i) removing the Monetary
Defect or applicable Additional Exceptions of record; (ii) posting a bond which
causes a Monetary Defect to cease to be a Lien on the Real Property; or
(iii) providing indemnification to the Title Insurer against adverse final
adjudication of any Monetary Defect or such Additional Exception and having the
Title Insurer provide an endorsement, if applicable, which deletes such Monetary
Defect or such Additional Exception as an exception to coverage.

 

Section 13.3           Failure to Cure Title Defects. If the Company fails to
cure a Monetary Defect that it is obligated to cure in accordance with
Section 13.2 hereof, or an Additional Exception that the Company had elected to
cure in accordance with Section 13.2 hereof, such failure shall be a default by
the Company and this Agreement shall, at the option of Buyer (to be exercised by
written notice to the Company given no later than the earlier of: (a) the
Closing Date or (b) five (5) business days after such the Company’s notice to
Buyer of such the Company’s election not to cure or attempt to cure such title
defects), be terminated, the Escrow Agent shall return the Deposit to Buyer and
Buyer and the Company shall be released and discharged from any further
obligation to each other hereunder; provided, that if Buyer so elects, Buyer may
accept such title as is tendered by the Company without a reduction in the
Purchase Price or reservation of claim against the Company (but without
limitation to any claim that Buyer may have with respect to a breach of the
Company’s obligations pursuant to Section 9.1(d) hereof). Buyer’s right to
terminate this Agreement pursuant to this Section 13.3 shall apply to the entire
Agreement and notwithstanding anything contained to the contrary herein, if
Buyer elects to terminate this Agreement pursuant to this Section 13.3, Buyer
shall not, in any event, have a right to terminate less than all of this
Agreement.

 

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Section 13.4           Survey.  Buyer agrees to accept the Real Property subject
to all matters shown by the surveys described on Section 13.4 of the Company
Disclosure Letter (collectively, the “Survey”). The Company shall, at Buyer’s
sole cost and expense, cause the Survey to be updated and recertified to Buyer
not earlier than one hundred twenty (120) days and not later than fifteen (15)
days prior to the Closing. If a recertified updated and recertified Survey
reveals: (a) any material encroachments of the Real Property onto property of
others; (b) any material encroachments of property of others onto the Real
Property; or (c) the location of any title matter on the Real Property in a
manner that would materially and adversely affect the ability to use the Real
Property as presently constructed and located on the Real Property; or any other
matter which would render title to the Real Property uninsurable and
unmarketable, and if such matters were not revealed by the Survey, then such
disclosure shall be an Additional Exception as to which the provisions of
Sections 13.2 and 13.3 hereof shall govern Buyer’s and the Company’s rights and
obligations.

 

Section 13.5           AS IS.  SUBJECT ONLY TO THE COMPANY’S REPRESENTATIONS AND
WARRANTIES AND COVENANTS EXPRESSLY SET FORTH HEREIN OR ANY CERTIFICATE OR
AGREEMENT DELIVERED PURSUANT HERETO AND SUBJECT TO THE CONDITIONS, RIGHTS AND
OBLIGATIONS SET FORTH HEREIN AND THEREIN, BUYER EXPRESSLY ACKNOWLEDGES AND
AGREES, AND REPRESENTS AND WARRANTS TO SELLER AND THE COMPANY, THAT BUYER HAS OR
WILL HAVE THE OPPORTUNITY TO FULLY EXAMINE AND INSPECT THE PURCHASED ASSETS
PRIOR TO THE EXECUTION OF THIS AGREEMENT AND THAT BUYER IS FULLY CAPABLE OF
EVALUATING AND HAS EVALUATED THE PURCHASED ASSETS’ SUITABILITY FOR BUYER’S
INTENDED USE THEREOF, AND BUYER IS PURCHASING THE PURCHASED ASSETS WITH ALL
DEFECTS IN THEIR “AS IS”, “WHERE IS” CONDITION AND WITH ALL FAULTS, WHETHER
KNOWN, UNKNOWN, APPARENT, OR LATENT. BUYER’S DECISION TO PURCHASE THE PURCHASED
ASSETS IS NOT BASED ON ANY COVENANT, WARRANTY, PROMISE, AGREEMENT, GUARANTY, OR
REPRESENTATION BY THE COMPANY, SELLER OR ANY OF THEIR AFFILIATES OR
REPRESENTATIVES AS TO CONDITION, PHYSICAL OR OTHERWISE, TITLE, LEASES, RENTS,
REVENUES, INCOME, EXPENSES, OPERATION, ZONING OR OTHER REGULATION, COMPLIANCE
WITH LAW, SUITABILITY FOR PARTICULAR PURPOSES OR ANY OTHER MATTER WHATSOEVER
EXCEPT TO THE EXTENT EXPRESSLY SET FORTH IN THIS AGREEMENT. SUBJECT ONLY TO THE
COMPANY’S REPRESENTATIONS, WARRANTIES AND COVENANTS EXPRESSLY CONTAINED HEREIN,
THE CONDITIONS SET FORTH IN ARTICLE X AND THE REPRESENTATIONS, WARRANTIES, AND
CONDITIONS SET FORTH IN ALL CERTIFICATES AND AGREEMENTS DELIVERED BY THE COMPANY
PURSUANT TO THIS AGREEMENT, BUYER ACKNOWLEDGES AND AGREES THAT NEITHER THE
COMPANY, SELLER, NOR ANY OF THEIR AFFILIATES NOR ANY OF THEIR RESPECTIVE
REPRESENTATIVES HAS MADE, AND BUYER SPECIFICALLY WAIVES AND RELINQUISHES ALL
RIGHTS, PRIVILEGES AND CLAIMS ARISING OUT OF, ANY ALLEGED REPRESENTATIONS,
WARRANTIES (INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
USE, AND WARRANTIES ARISING FROM A COURSE OF DEALING, USAGE OR TRADE), PROMISES,
COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER
EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST, PRESENT OR FUTURE, WHICH MAY HAVE
BEEN MADE OR GIVEN, OR WHICH MAY

 

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BE DEEMED TO HAVE BEEN MADE OR GIVEN, BY THE COMPANY, ITS AFFILIATES OR ANY OF
THEIR RESPECTIVE REPRESENTATIVES, AS TO, CONCERNING OR WITH RESPECT TO:

 

(A)          THE VALUE OF THE PURCHASED ASSETS (REGARDLESS OF, WITHOUT
LIMITATION, ANY STATEMENTS MADE BY THE COMPANY OR ANY ENTRY MADE IN THE
COMPANY’S FINANCIAL STATEMENTS);

 

(B)           THE INCOME DERIVED OR TO BE DERIVED FROM THE PURCHASED ASSETS;

 

(C)           THE SUITABILITY OF THE REAL PROPERTY FOR ANY AND ALL ACTIVITIES
AND USES WHICH BUYER MAY CONDUCT THEREON, INCLUDING, THE POSSIBILITIES FOR
FUTURE DEVELOPMENT OF THE REAL PROPERTY;

 

(D)          THE FITNESS OF THE PURCHASED ASSETS FOR ANY PARTICULAR PURPOSE;

 

(E)           THE MANNER OR QUALITY OF REPAIR, STATE OF REPAIR OR LACK OF REPAIR
OF THE PURCHASED ASSETS;

 

(F)           THE NATURE, QUALITY OR CONDITION OF THE PURCHASED
ASSETS, INCLUDING SOILS CONDITION, ANY GRADING OR OTHER WORK PERFORMED ON OR
WITH RESPECT TO THE REAL PROPERTY, AND THE GEOLOGICAL CONDITION OF THE REAL
PROPERTY;

 

(G)           THE COMPLIANCE OF OR BY THE REAL PROPERTY OR ITS OPERATION WITH
ANY APPLICABLE LAWS;

 

(H)          THE MANNER OR QUALITY OF THE CONSTRUCTION OR MATERIALS, IF ANY,
INCORPORATED INTO THE REAL PROPERTY;

 

(I)            COMPLIANCE WITH ANY ENVIRONMENTAL PROTECTION, POLLUTION OR LAND
USE LAWS, RULES, REGULATIONS, ORDERS OR REQUIREMENTS, INCLUDING TITLE III OF THE
AMERICANS WITH DISABILITIES ACT OF 1990 OR ANY ENVIRONMENTAL LAWS, AS ANY OF THE
FOREGOING MAY BE AMENDED FROM TIME TO TIME AND REGULATIONS PROMULGATED UNDER ANY
OF THE FOREGOING FROM TIME TO TIME;

 

(J)            THE PRESENCE, SUSPECTED PRESENCE OR ABSENCE OF HAZARDOUS
SUBSTANCES AT, ON, UNDER, OR ADJACENT TO THE REAL PROPERTY;

 

(K)          THE CONTENT, COMPLETENESS OR ACCURACY OF THE STUDY MATERIALS OR ANY
PLANS, DRAWINGS, DESCRIPTIONS OR THE LIKE WITH RESPECT TO THE REAL PROPERTY;

 

(L)           THE CONFORMITY OF THE REAL PROPERTY TO PAST, CURRENT OR FUTURE
APPLICABLE ZONING OR BUILDING REQUIREMENTS;

 

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(M)         DEFICIENCY OF ANY DRAINAGE;

 

(N)          THE FACT THAT THE REAL PROPERTY MAY BE LOCATED ON OR NEAR
EARTHQUAKE FAULTS OR IN SEISMIC HAZARD ZONES;

 

(O)          THE EXISTENCE OR NON-EXISTENCE OF VESTED LAND USE, ZONING OR
BUILDING ENTITLEMENTS AFFECTING THE REAL PROPERTY; OR

 

(P)           ANY OTHER MATTER CONCERNING THE NATURE OR CONDITION OF THE REAL
PROPERTY, PHYSICAL OR OTHERWISE.

 

SUBJECT ONLY TO THE COMPANY’S REPRESENTATIONS, WARRANTIES AND COVENANTS
EXPRESSLY CONTAINED HEREIN, THE CONDITIONS SET FORTH IN ARTICLE X, THE RIGHTS
AND OBLIGATIONS SET FORTH IN ARTICLE X, AND ANY CERTIFICATES DELIVERED BY THE
COMPANY PURSUANT TO THIS AGREEMENT, BUYER FURTHER ACKNOWLEDGES AND AGREES THAT
THE PURCHASE PRICE REFLECTS THE PARTIES’ AGREEMENT TO CONVEY THE EQUITY
INTERESTS, INCLUDING THE REAL PROPERTY ON AN “AS IS, WHERE IS” BASIS AND BUYER
HAS SPECIFICALLY AGREED TO DO SO IN ORDER TO INDUCE SELLER AND THE COMPANY TO
ENTER INTO THIS AGREEMENT. BUYER FURTHER ACKNOWLEDGES THAT NEITHER SELLER NOR
THE COMPANY IS LIABLE FOR AND SHALL NOT BE BOUND IN ANY MANNER BY ANY ORAL OR
WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE
COMPANY, INCLUDING THE PURCHASED ASSETS, OR THE OPERATION THEREOF, FURNISHED BY
ANY REPRESENTATIVE OF THE COMPANY, EXCEPT TO THE EXTENT CONTAINED IN THE
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY EXPRESSLY SET FORTH
HEREIN AND IN ANY CERTIFICATES DELIVERED BY THE COMPANY PURSUANT TO THE TERMS OF
THIS AGREEMENT. SUBJECT ONLY TO THE COMPANY’S REPRESENTATIONS, WARRANTIES AND
COVENANTS EXPRESSLY CONTAINED HEREIN, THE CONDITIONS SET FORTH IN ARTICLE X AND
ANY CERTIFICATES AND AGREEMENTS DELIVERED BY THE COMPANY PURSUANT TO THIS
AGREEMENT, BUYER FURTHER ACKNOWLEDGES AND AGREES THAT, TO THE MAXIMUM EXTENT
PERMITTED BY LAW, THE SALE OF THE EQUITY INTERESTS, INCLUDING THE TRANSFER OF
THE REAL PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN “AS IS”, “WHERE IS”
CONDITION AND BASIS WITH ALL FAULTS, AND SUBJECT TO ALL APPLICABLE LAWS
GOVERNING OR LIMITING THE DEVELOPMENT, USE OR OPERATION OF THE PURCHASED ASSETS
OR THE CASINO (SUBJECT ONLY TO THE COMPANY’S REPRESENTATIONS, WARRANTIES AND
COVENANTS EXPRESSLY SET FORTH HEREIN AND IN ANY CERTIFICATES DELIVERED BY THE
COMPANY PURSUANT TO TERMS OF THIS AGREEMENT), AND THAT THE COMPANY HAS NO
OBLIGATIONS TO MAKE REPAIRS, REPLACEMENTS OR IMPROVEMENTS OF ANY KIND TO THE
PURCHASED ASSETS.

 

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Section 13.6           No Conflict. Nothing in this Article XIII shall limit or
modify the Company’s obligations pursuant to Section 9.1(d) hereof or any
remedies that may be available to Buyer in connection with any breach of such
obligations pursuant to this Agreement.

 

ARTICLE XIV.

MISCELLANEOUS

 

Section 14.1           Definitions.

 

(a)           For purposes of this Agreement, the term:

 

“Accounts Receivable” means all accounts receivable (including receivables and
revenues for food, beverages, telephone and casino credit), notes receivable or
overdue accounts receivable, in each case, due and owing by any third party, but
not including the Tray Ledger and the Markers owed to the Company or its
Affiliates

 

“Acquired Personal Property” means the Personal Property, excluding the Excluded
Personal Property.

 

“Acquisition Proposal” means any proposal or offer from any Person relating to
any direct or indirect acquisition or purchase of the Real Property or the other
Purchased Assets, other than the transactions with Buyer contemplated by this
Agreement.

 

“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such first-mentioned Person.

 

“Ancillary Agreements” means the Bill of Sale and Assignment, the Assignment and
Assumption Agreement, the Trademark Assignment Agreement, the Assignment of
Equity Interests, and the Deposit Escrow Agreement.

 

“Assumed Contracts” means all service contracts, equipment leases and other
leases with respect to Personal Property, Intellectual Property license
agreements, sign leases and other Contracts exclusively related to the Casino,
other than the Excluded Contracts and Contracts that relate to the Excluded
Assets.

 

“Business” means the business conducted by the Company at or with respect to the
Casino.

 

“Buyer Material Adverse Effect” means changes, events, circumstances or effects
that have had, will have or would reasonably be expected to have a material
adverse effect on Buyer’s ability to perform its obligations hereunder, obtain
any Gaming Approval or to consummate the transactions contemplated hereby.

 

“Casino” means that certain hotel and casino located on the Real Property and
commonly known as Harrah’s St. Louis.

 

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“Class A License” means a license granted by the Missouri Gaming Commission
under the Gaming Laws to allow the parent organization(s) or controlling entity,
as determined by the executive director, to develop and operate Class B
licensee(s).

 

“Class B License” means a license granted by the Missouri Gaming Commission
under the Gaming Laws to maintain, conduct gambling games on, and operate an
excursion gambling boat and gaming facility at a specific location.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Company Material Adverse Effect” means changes, events, circumstances or
effects that have had, will have or could reasonably be expected to be material
and adverse to the business, financial condition or results of operations of the
Purchased Assets or the Business, taken as a whole; provided, that none of the
following, individually and in the aggregate, shall constitute or be taken into
account in determining whether a Company Material Adverse Effect has occurred:
(i) general conditions (or changes therein) in the (A) travel, hospitality or
gaming industries, or in the jurisdiction where the Company operates or (B) the
financial, banking, currency or capital markets, (ii) any change in GAAP or
applicable Law (other than a change in Gaming Law prohibiting or substantially
restricting gaming activities which are currently permitted at Closing),
(iii) any change, event or effect resulting from the entering into or public
announcement of the transactions contemplated by this Agreement, (iv) any
change, event or effect resulting from any act of terrorism, commencement or
escalation of armed hostilities in the U.S. or internationally, and (v) the
failure of the Casino to meet any financial or other projections (provided that
the underlying cause of any such failure to meet financial or other projections
may be considered in determining whether a Company Material Adverse Effect has
occurred); provided, however, that the matters described in clauses (i),
(ii) and (iv) above shall be considered in determining whether a Company
Material Adverse Effect has occurred to the extent of any disproportionate
impact on the Purchased Assets or the Business, taken as a whole, relative to
other participants operating in the same industries and geographic markets as
the Business.

 

“Company Sale” means a bona fide sale of the Business for cash, by means of a
sale of all of the Equity Interests or all or substantially all of the assets of
the Company to a non-affiliated third party.

 

“Confidentiality Agreement” means that certain agreement entered into as of
January 10, 2012 between CEOC and Buyer.

 

“Contract” means any agreement, contract, lease, power of attorney, note, loan,
evidence of indebtedness, purchase order, letter of credit, settlement
agreement, franchise agreement, undertaking, covenant not to compete, employment
agreement, license, instrument, obligation, commitment, understanding, policy,
purchase and sales order, quotation and other executory commitment to which any
Person is a party or to which any of the assets of such Person are subject,
whether oral or written, express or implied.

 

“Controlled Group Liability” means any and all liabilities (i) under Title IV of
ERISA, (ii) under Section 302 of ERISA, (iii) under Sections 412 and 4971 of the
Code, (iv) as a result of a failure to comply with the continuation coverage
requirements of Section 601 et seq. of

 

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ERISA and Section 4980B of the Code, and (v) under corresponding or similar
provisions of foreign laws or regulations,

 

“Customer Database” means all customer databases, customer lists historical
records of customers and any other information collected with respect to
customers of the Casino, including any information used in connection with
marketing and promoting the Casino.

 

“Customer List” means a list of the names and key tendencies of customers listed
on the Customer Database who have visited the Casino during the twenty-four (24)
month period prior to the Closing, which Customer List shall be in format and
contain the information set forth on Exhibit E to the extent available in the
Customer Database, and subject to receipt of consent from each customer to the
transfer of such information to the extent required by the Total Rewards Program
or applicable Law.

 

“Encumbrances” means claims, pledges, agreements, limitations on voting rights,
charges or other encumbrances or restrictions on transfer of any nature.

 

“Environment” means ambient air, vapors, surface water, groundwater, wetlands,
drinking water supply, land surface, or subsurface strata and biota.

 

“Environmental Condition” means, as relating exclusively to the Purchased
Assets, the release into the Environment and/or presence in the Environment of
any Hazardous Substance as a result of which the Company (i) has or may become
liable to any Person for an Environmental Liability, (ii) is or was in violation
of any Environmental Law, (iii) has or may be required to incur response costs
for compliance, investigation or remediation, or (iv) by reason of which the
Real Property or other assets of the Company, may be subject to any Lien under
Environmental Laws; provided, however, that none of the foregoing shall be an
Environmental Condition if such matter was fully remediated or otherwise fully
corrected prior to the date hereof in accordance with Environmental Law and to
the satisfaction of the applicable Governmental Entity.

 

“Environmental Laws” means all applicable and legally enforceable federal, state
and local statutes or laws, common law, judgments, orders, regulations,
licenses, permits, enforceable guidance and policies, rules and ordinances
relating to Hazardous Substances, pollution, restoration or protection of
health, safety or the environment, including, but not limited to the Federal
Water Pollution Control Act (33 U.S.C. §1251 et seq.), Resource Conservation and
Recovery Act (42 U.S.C. §6901 et seq.), Safe Drinking Water Act (42 U.S.C.
§3000(f) et seq.), Toxic Substances Control Act (15 U.S.C. §2601 et seq.), Clean
Air Act (42 U.S.C. §7401 et seq.), Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. §9601 et seq.) and other similar state
and local statutes, in effect as of the date hereof, including any judicial or
administrative interpretation thereof.

 

“Environmental Liabilities” means all Liabilities (including all reasonable
fees, disbursements and expenses of counsel, expert and consulting fees and
costs of investigations and feasibility studies and responding to government
requests for information or documents), fines, penalties, restitution and
monetary sanctions, interest, direct or indirect, known or unknown, absolute or
contingent, past, present or future, resulting from any claim or demand, by any
Person or entity, under Environmental Law and relating exclusively to the
Company’s Purchased Assets or the generation and disposal of wastes or other
materials relating to the Business.

 

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“ERISA Affiliate” means any trade or business, whether or not incorporated, that
together with the Company would be deemed a “single employer” within the meaning
of Section 4001(b) of ERISA or Section 414 of the Code.

 

“Estimated Closing Net Working Capital” means the Company’s good faith estimate
of the Net Working Capital of the Business as of the Closing.

 

“Estimated Closing Net Working Capital Overage” means the amount, if any, by
which the Estimated Closing Net Working Capital is greater than the Target Net
Working Capital.

 

“Estimated Closing Net Working Capital Shortage” means the amount, if any, by
which the Estimated Closing Net Working Capital is less than the Target Net
Working Capital.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

 

“Excluded Contracts” means all Contracts listed in Section 14.1(a) of the
Company Disclosure Letter.

 

“Excluded Personal Property” means the following:

 

(i)            any Personal Property covered by the equipment leases from
Affiliates of the Company or other agreements by which property owned by
Affiliates of the Company is located at the Real Property and used in connection
with the Business, all of which equipment leases and other agreements are set
forth on Section 14.1(b) of the Company Disclosure Letter;

 

(ii)           all point of sale credit card verification terminals or imprint
plates owned by third parties;

 

(iii)          any and all signs, menus, stationery, gift shop inventory or
other items indicating that the Real Property is owned and/or operated by or on
behalf of the Company or its Affiliates or bearing the System Mark of the
Company or its Affiliates;

 

(iv)          any gaming licenses, liquor licenses or other licenses or permits
pertaining to the Real Property not indirectly transferable to Buyer, in the
sale of the Equity Interests, by Law; and

 

(v)           any personal property held as prizes.

 

“Excluded Software” means all computer software owned by or licensed for use by
the Company or its Affiliates, including all source codes, object codes and data
bases, whether on tape, disc or other computerized format, and all related user
manuals, computer records, service codes, programs and stored materials
(including all access codes and instructions needed to obtain access to and to
utilize the information contained on such computer records), together with any
and all updates and modifications of all of the foregoing and all copyrights
related to the foregoing, including the Customer Database and any customer
tracking system.

 

“Excluded Taxes” means, without duplication, all (i) Taxes (for the avoidance of
doubt, other than Transfer Taxes that are governed by Section 9.9(a)) imposed on
or payable by or with

 

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respect to the Company, or for which it is liable, for any Pre-Closing Period;
(ii) Taxes relating to the Excluded Assets or the Excluded Liabilities
(including, for the avoidance of doubt, any Taxes resulting from or arising out
of any actions or transactions pursuant to Section 1.4(a) (but not to the extent
such Taxes have reduced the amounts payable to Sellers pursuant to
Section 1.4(a)) or (b) or Section 1.5 relating to any Excluded Assets or
Excluded Liabilities); (iii) Liabilities of the Company pursuant to any Tax
sharing, allocation or indemnification agreement entered into before the Closing
to indemnify any other Person in respect of or relating to Taxes of such other
Person to the extent such Liabilities (A) relate to a Pre-Closing Period or
(B) otherwise accrue, arise out of, or relate to events, occurrences, pending or
threatened litigation, acts, omissions and claims happening or existing prior to
the Closing; (iv) Taxes relating to a Pre-Closing Period for which the Company
is liable (or that may be collected from the Company by way of offset against a
refund of Tax otherwise due to the Company) under Treasury Regulation
Section 1.1502-6 (or any similar provision of state, local or foreign Law) or as
a successor or transferee; and (v) Taxes of Sellers and their Affiliates (other
than the Company) for any period (for the avoidance of doubt, other than
Transfer Taxes that are governed by Section 9.9(a)).

 

“FCC” means the Federal Communications Commission.

 

“FCC Licenses” means the licenses to operate a base station or two way security
radios at the Casino as described in Section 14.1(c) of the Company Disclosure
Letter.

 

“Final Closing Net Working Capital” means the Net Working Capital of the
Business as of the Closing as set forth in the Final Closing Statement.

 

“Final Closing Net Working Capital Overage” means the amount, if any, by which
the Final Closing Net Working Capital is greater than the Target Net Working
Capital.

 

“Final Closing Net Working Capital Shortage” means the amount, if any, by which
the Final Closing Net Working Capital is less than the Target Net Working
Capital.

 

“Fixtures” means all fixtures owned or leased by the Company and placed on,
attached to, or located at the Real Property.

 

“Front Money” means all money stored on deposit in the Casino cage belonging to,
and stored in an account for, any Person who is not the Company or an Affiliate
of the Company.

 

“GAAP” means generally accepted accounting principles in the United States.

 

“Gaming Approvals” means all licenses, permits, approvals, authorizations,
registrations, findings of suitability, franchises, entitlements, waivers and
exemptions issued by any Gaming Authority or required by any Gaming Law
necessary for or relating to the conduct of activities by any party hereto or
any of its Affiliates and the transactions contemplated hereby, including the
ownership, operation, management and development of the Business, the Purchased
Assets and Assumed Liabilities; specifically including a resolution by the
Missouri Gaming Commission granting the Petition for Change in Control of the
Company from Sellers to Buyer as contemplated by and upon the terms set forth in
this Agreement.

 

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“Gaming Authorities” means any Governmental Entity with regulatory control or
jurisdiction over the conduct of lawful gaming or gambling in any jurisdiction
and within the State of Missouri, specifically the Missouri Gaming Commission.

 

“Gaming Laws” means any federal, state, local or foreign statute, ordinance
(including zoning), rule, regulation, permit (including land use), consent,
registration, finding of suitability, approval, license, judgment, order,
decree, injunction or other authorization, including any condition or limitation
placed thereon, governing or relating to the current or contemplated casino and
gaming activities and operations and manufacturing and distributing operations
of the Purchased Assets, the Business or the Company.

 

“Gift Certificate” means any certificate, coupon, voucher or other writing which
entitles the holder or bearer to a credit (whether in a specified dollar amount
or for a specified item, such as a room night or meal) to be applied against the
usual charge for rooms, meals and/or other goods or services at the Casino; but
shall not include complimentary rooms (or room rates below average rack rates)
granted to convention and other meeting groups in the Ordinary Course of
Business.

 

“Harrah’s Branded Paraphernalia” means all personal property of the Company
including chips, tokens, cards, dice, promotional coupons and tickets, marketing
items, and office supplies, which include the trade names, trade dress, logos
and general marketing style associated with Parent, Sellers or their respective
Affiliates, and their controlled casino operations, including Harrah’s, Caesars
Entertainment, Harrah’s St. Louis and Harrah’s Maryland Heights.

 

“Hazardous Substance” means any pollutant, chemical, substance and any toxic,
infectious, carcinogenic, reactive, corrosive, ignitable or flammable chemical,
or chemical compound, or hazardous substance, material or waste, whether solid,
liquid or gas, that is subject to regulation, control or remediation under
applicable Environmental Laws, or that otherwise results in any Environmental
Liability, including any quantity of friable asbestos, urea formaldehyde foam
insulation, PCBs, crude oil or any fraction thereof, all forms of natural gas,
petroleum products or by-products or derivatives.

 

“House Funds” means all cash and cash equivalents located at the Casino,
including cash, negotiable instruments, and other cash equivalents located in
cages, drop boxes, slot machines and other gaming devices, cash on hand for the
Casino manager’s petty cash fund and cashiers’ banks, coins and slot hoppers,
carousels, slot vault and poker bank and cash in the registration, retail,
restaurant and other non-gaming areas of the Real Property (including in vending
machines, postage meters, pay phones, laundry machines and other cash-operated
equipment), and all checks, travelers’ checks, and bank drafts paid by guests of
the Casino, but shall not include Front Money, which shall be treated in
accordance with Section 9.11(d) hereof or the Tray Ledger, which shall be
treated in accordance with Section 4.2(a) hereof.

 

“Intellectual Property” means all intellectual property or other proprietary
rights of every kind, foreign or domestic, including all patents, patent
applications, inventions (whether or not patentable), processes, technologies,
discoveries, apparatus, know-how, trade secrets, trademarks, trademark
registrations and applications, domain names, trade dress, service marks,
service mark registrations and applications, trade names, and all goodwill
associated with the foregoing, copyright registrations, copyrightable and
copyrighted works, databases, software,

 

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rights of publicity, rights of privacy, moral rights, customer lists and
confidential marketing and customer information.

 

“IRS” means the Internal Revenue Service, a division of the United States
Treasury Department, or any successor thereto.

 

“knowledge” means (i) when used in the phrase “Company’s knowledge” or “Sellers’
knowledge” and words of similar import, the actual knowledge of: Tim Lambert,
Ryan Hammer, Matt Heiskell and Matt Anfinson and (ii) when used in the phrase
“knowledge of Buyer” or “Buyer’s knowledge” and words of similar import, the
actual knowledge of: Carl Sottosanti, Frank Donaghue and Walter Bogumil.

 

“Law” means any foreign or domestic law, statute, code, ordinance, rule,
regulation, order, judgment, writ, stipulation, award, injunction, decree or
arbitration award, policies, guidance, court decision, rule of common law or
finding.

 

“Liabilities” means any direct or indirect liability, indebtedness, obligation,
commitment, expense, claim, deficiency, guaranty or endorsement of or by any
Person of any type, whether accrued, absolute, contingent, matured, unmatured,
liquidated, unliquidated, known or unknown.

 

“Liens” means any mortgage, deed of trust, pledge, option, right of first
refusal or first offer, conditional sale, lien, security interest, conditional
or installment sale agreement, charge or other claims or rights of third parties
of any kind.

 

“Markers” means any amounts owed by any Person that is not an Affiliate of the
Company to the Company related to the Casino for gaming chips, tokens or similar
cash equivalents used at the Real Property delivered to such Person on credit or
otherwise.

 

“Net Working Capital” means the difference between (a) the current assets of the
Business, including cash and cash equivalents (including House Funds), the value
of inventory, Accounts Receivable, Gift Certificates, and current prepaid
expenses, to the extent benefiting the Business post-Closing and (b) the current
liabilities of the Business, including accounts payable, all accrued expenses,
all accrued Liabilities with respect to the Transferred Employees, all Customer
Deposits and all Progressive Liabilities, with each amount determined in
accordance with GAAP applied on a basis consistent with the past practices of
the Company and its Affiliates; provided, that (x) if the Company has not made
any Required Capital Expenditure required prior to the Closing Date pursuant to
Section 9.1(p), then the Net Working Capital as of the Closing Date shall be
deemed to be decreased by the amount of each such shortfall, and (y) if the
Company has made any Required Capital Expenditure prior to the Closing Date that
is not required to be made pursuant to Section 9.1(p) until after the Closing
Date, then the Net Working Capital as of the Closing Date shall be deemed to be
increased by the amount of each such early payment. For purposes of this
Agreement, Net Working Capital shall exclude (i) the items set forth in Sections
4.2 and 4.6 hereof and (ii) any Tax assets or Liabilities.

 

“New Sale Price” shall mean the aggregate consideration payable in connection
with the Company Sale that is the subject of the New Sale Agreement, taking into
account any applicable purchase price adjustments.

 

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“Ordinary Course of Business” shall describe any action taken by a Person if
such action is consistent with such Person’s past practices and is taken in the
ordinary course of such Person’s normal day to day operations.

 

“Permitted Encumbrances” means any lien to secure payment of real estate Taxes,
including special assessments, which is a lien not yet due or payable, all
matters disclosed by the Survey, zoning and subdivision ordinances (provided
such ordinances are not currently violated or in anticipation of being
violated), terms and conditions of licenses, permits and approvals for the Real
Property (which are disclosed on Section 7.11(a) of the Company Disclosure
Letter) and Laws of any Governmental Entity having jurisdiction over the Real
Property.

 

“Permitted Liens” means, with respect to the Company (i) Liens or Encumbrances
for assessments and other governmental charges not delinquent or which are
currently being contested in good faith by appropriate proceedings; (ii) Liens
or Encumbrances for Taxes not yet due and payable or Taxes being contested in
good faith by appropriate proceedings; (iii) mechanics’ and materialmen’s Liens
or Encumbrances not filed of record and similar charges not delinquent or which
are filed of record but are being contested in good faith by appropriate
proceedings; (iv) Liens or Encumbrances in respect of judgments or awards with
respect to which the Company shall in good faith currently be prosecuting an
appeal or other proceeding for review and with respect to which the Company
shall have secured a stay of execution pending such appeal or such proceeding
for review; (v) easements, leases, reservations or other rights of others in, or
minor defects and irregularities in title to, property or assets of the Company;
provided that, such easements, leases, reservations, rights, defects or
irregularities do not impair the use of the property or assets for the purposes
for which they are held in any material manner; (vi) rights of tenants under
operating leases and hotel guests whose occupancy may be terminated on short
notice; (vii) with respect to the Real Property, all exceptions described in the
Title Policy (other than items 39-40 on Schedule B thereto), the Title
Commitment (other than items 44-49 on Schedule B thereto) and the UCC Search
(other than those set forth on Section 14.1(d) of the Company Disclosure
Letter); (viii) any Assumed Liability; and (ix) any Lien or Encumbrance that
will be released and discharged at or prior to the Closing.

 

“Person” means an individual, corporation, limited liability company,
partnership, association, trust, unincorporated organization, other entity or
“group” (as defined in Rule 13d-5(b)(1) under the Exchange Act).

 

“Personal Property” means all office, hotel, casino, barge, showroom,
restaurant, bar, convention, meeting and other furniture, furnishings, fittings,
appliances, equipment, equipment manuals, slot machines, gaming tables and
gaming paraphernalia (including parts or inventories thereof),
passenger/delivery vehicles, computer hardware and IT hardware systems,
reservations terminals, software, point of sale equipment, two-way security
radios and base station, machinery, spare parts, apparatus, appliances,
draperies, art work, carpeting, keys, building materials, telephones and other
communications equipment, televisions, maintenance equipment, tools, signs and
signage, office supplies, engineering, maintenance and cleaning supplies and
other supplies of all kinds, stationery and printing, linens (sheets, towels,
blankets, napkins), uniforms, silverware, glassware, chinaware, pots, pans and
utensils, and food, beverage, alcoholic beverage inventories, all articles of
personal property now located on the Real Property for resale, whether owned or
leased by the Company, and other tangible personal

 

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property that are used or held for use in the Business and located at the Casino
on the Closing Date.

 

“Petition for Change in Control” means a document filed with the Missouri Gaming
Commission in proper form to request approval of a “change in control” under 11
CSR 45-10.040(12) upon the terms and conditions set forth in this Agreement
without the automatic nullification of the existing Class B License held by the
Company under the Gaming Laws that would occur absent such approval.

 

“Post-Closing Period” means any taxable period (including the portion of a
Straddle Period) beginning after the Closing Date.

 

“Pre-Closing Period” means any taxable period (including the portion of a
Straddle Period) ending on or before the Closing Date.

 

“Progressive Liabilities” means the sum of (a) the face amounts of the
progressive slot machine meters with an in house progressive jackpot feature (if
such slot machines are not removed by the vendor at or before the Closing) and
(b) the face amounts of the meters for the table games with an in house
progressive jackpot feature.

 

“Real Property” means the real property described on Section 7.6(a) of the
Company Disclosure Letter attached hereto, in each case together with the
buildings located thereon and the barge located thereon, and all associated
parking areas, Fixtures and all other improvements located thereon (the
buildings and such other improvements are referred to herein collectively as the
(“Improvements”)); all references hereinafter made to the Real Property shall be
deemed to include all rights, benefits, privileges, tenements, hereditaments,
covenants, conditions, restrictions, easements and other appurtenances on the
Real Property or otherwise appertaining to or benefitting the Real Property
and/or the Improvements situated thereon, including all mineral rights,
development rights, air and water rights, subsurface rights, vested rights
entitling, or prospective rights which may entitle the owner of the Real
Property to related easements, land use rights, air rights, viewshed rights,
density credits, water, sewer, electrical or other utility service, credits
and/or rebates, strips and gores and any land lying in the bed of any street,
road or alley, open or proposed, adjoining the Real Property, and all easements,
rights-of-way and other appurtenances used or connected with the beneficial use
or enjoyment of the Real Property.

 

“Rebranding Plan” means the plan for removing all Harrah’s Branded Paraphernalia
from the operations of the Company as agreed upon between the parties and set
forth on Schedule A attached hereto and incorporated herein.

 

“Reserved Employees” means the employees of the Casino that are listed in
Section 14.1(e) of the Company Disclosure Letter.

 

“Rewards Information” means the portion of the Customer Database that includes
the total points accrued at the Casino by customers listed on the Customer List
under the Total Rewards Program to the extent that Parent can obtain such
information using its commercially reasonable efforts, and subject to receipt of
consent from each customer to the transfer of such information to the extent
required by the Total Rewards Program or applicable Law.

 

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“Room Revenues” means all revenues from the rental of guest rooms at the Casino,
together with any sales or other taxes thereon.

 

“Subsidiary” means, with respect to any party, any corporation or other
organization, whether incorporated or unincorporated, of which (i) such party or
any other Subsidiary of such party is a general partner or managing member or
(ii) at least 50% of the securities or other equity interests having by their
terms voting power to elect a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization that is, directly or indirectly, owned or controlled by such party
or by any one or more of its Subsidiaries, or by such party and one or more of
its Subsidiaries.

 

“System Mark” means service marks, trademarks, trade names, fictitious business
names, slogans, color arrangements, designs, logos, Internet domain names and
other similar indicia of source or origin now or hereafter used or owned by the
Company or any of its Affiliates that is not used exclusively in the Business.

 

“Target Net Working Capital” means $1,500,000.

 

“Taxes” means any and all taxes, charges, fees, levies, tariffs, duties,
liabilities, impositions or other assessments in the nature of a tax (together
with any and all interest, penalties, additions to tax and additional amounts
imposed with respect thereto) imposed by any Governmental Entity, including
income, gross receipts, profits, gaming, live entertainment, 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 and recording taxes.

 

“Tax Return” means any report, return (including any information return), claim
for refund, election, estimated Tax filing or payment, request for extension,
document, declaration or other information or filing supplied or required to be
supplied to any Governmental Entity with respect to Taxes, including attachments
thereto and amendments thereof.

 

“Title Commitment” means that certain title commitment number NCS-539000-3-MPLS
issued by First American Title Insurance Company, with an effective date of
March 14, 2012.

 

“Title Insurer” means the title company, if any, selected by Buyer to issue the
Endorsement, if applicable.

 

“Title Policy” means that certain policy of title insurance issued by the
Chicago Title Insurance Company, dated February 6, 2008, for the benefit of the
Company with respect to the Real Property.

 

“Total Rewards Program” means the Total Rewards® player loyalty program of
Parent and its Affiliates.

 

“Tray Ledger” means any accounts receivable of registered hotel guests who have
not checked out and who are occupying hotel rooms at the Casino on the evening
of the Closing Date, including the related Room Revenues.

 

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“WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988
and analogous state and local Law.

 

(b)           The following are defined elsewhere in this Agreement, as
indicated below:

 

 

 

Cross Reference

Terms

 

in Agreement

AAA

 

Section 12.5(b)

Additional Amount

 

Section 11.2(c)

Additional Exceptions

 

Section 13.2(a)

Adjustment Date

 

Section 3.1

Agreement

 

Preamble

Assignment and Assumption Agreement

 

Section 5.2(b)

Assignment of Equity Interests

 

Section 5.2(g)

Assumed Liabilities

 

Section 2.1

Auditor

 

Section 3.3

Bill of Sale and Assignment

 

Section 5.2(a)

Buyer

 

Preamble

Buyer Benefit Plans

 

Section 9.4(d)

Buyer Disclosure Letter

 

Article VIII

Buyer Indemnified Parties

 

Section 12.2(a)

Buyer Indemnified Party

 

Section 12.2(a)

Buyer Permits

 

Section 8.6

Buyer Related Parties

 

Section 8.5

Buyers’ 125 Plan

 

Section 9.4(g)

Buyer’s 401(k) Plan

 

Section 9.4(f)

Buyer’s Medical Plans

 

Section 9.4(e)

Cap

 

Section 12.6(a)

CEOC

 

Preamble

Chips and Tokens

 

Section 2.1(i)

CLC

 

Section 7.7(a)

Closing

 

Section 5.1

Closing Date

 

Section 5.1

Closing Payment

 

Section 3.1

Commitment Letter

 

Section 8.4

Company

 

Preamble

Company’s 125 Plan

 

Section 9.4(g)

Company 401(k) Plan

 

Section 9.4(f)

Company Benefit Plans

 

Section 7.13(a)

Company Disclosure Letter

 

Article VII

Company Permits

 

Section 7.11(a)

Customer Deposits

 

Section 4.4(c)

Damages

 

Section 12.2(a)

Deductible

 

Section 12.6(a)

Defect Notice

 

Section 13.2(a)

Deposit

 

Section 3.2

 

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Cross Reference

Terms

 

in Agreement

Deposit Escrow Agreement

 

Section 3.2

Designated Buyer Representative

 

Section 9.2(a)

Determination Date

 

Section 4.3(c)

DOL

 

Section 7.13(c)

Effective Date

 

Preamble

Endorsement

 

Section 13.1

Environmental Authorizations

 

Section 7.10

Equity Interests

 

Recitals

ERISA

 

Section 7.13(a)

Escrow Agent

 

Section 3.2

Estimated Closing Payment

 

Section 4.1

Estimated Closing Statement

 

Section 4.1

Estimated Operations Payment

 

Section 4.2

Estimated Operations Statement

 

Section 4.2

Excluded Assets

 

Section 1.2

Excluded Liabilities

 

Section 2.2

Extension Deposit

 

Section 3.2

FCC Approvals

 

Section 9.14(a)

Final Closing Payment

 

Section 4.3(a)

Final Closing Statement

 

Section 4.3(a)

Final Operations Payment

 

Section 4.3(b)

Final Operations Statement

 

Section 4.3(b)

Final Statements

 

Section 4.3(c)

Financial Information

 

Section 7.3

Fundamental Representations

 

Section 12.1(b)

Governmental Approvals

 

Section 9.6(a)

Governmental Entity

 

Section 6.2(c)

Group Tax Returns

 

Section 12.9(b)(i)

HMHO

 

Preamble

HSR Act

 

Section 6.2(c)

Improvements

 

Section 14.1(a)

Indemnified Parties

 

Section 12.3

Indemnified Party

 

Section 12.3

Indemnifying Parties

 

Section 12.3

Indemnifying Party

 

Section 12.3

Inspection

 

Section 9.5(a)

Insurance Policies

 

Section 7.20

Inventoried Vehicles

 

Section 9.11(e)

Labor Agreement

 

Section 7.12(b)

Make-Whole Amount

 

Section 11.2(d)

Monetary Defects

 

Section 13.2(c)

Multiemployer Plan

 

Section 7.13(c)

Multiple Employer Plan

 

Section 7.13(c)

New Sale Agreement

 

Section 11.2(d)

Non-Assignable Excluded Asset

 

Section 1.4(c)

 

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Cross Reference

Terms

 

in Agreement

Non-Monetary Defect

 

Section 13.2(a)

Notice

 

Section 12.3

Notice Period

 

Section 13.2(a)

Objection Notice

 

Section 12.5(a)

Ordinary Course of Business

 

Section 14.1

Other Transferred Registered IP

 

Section 7.7(a)

Outside Date

 

Section 5.1

Owned Real Property

 

Section 7.6(a)

Payoff Letter

 

Section 9.20

PMHN

 

Preamble

Pre-Closing Separate Tax Returns

 

Section 12.9

Property Employees

 

Section 7.13(a)

Purchase Price

 

Section 3.1

Purchase Price Allocation

 

Section 3.3

Purchased Assets

 

Section 1.1

Reimbursement Accounts

 

Section 9.4(g)

Removal Period

 

Section 1.5

Representatives

 

Section 9.3

Required Capital Expenditures

 

Section 9.1(p)

Required Governmental Consents

 

Section 10.2(d)

Restricted Area

 

Section 9.19

Seller Indemnified Parties

 

Section 12.2(b)

Seller Indemnified Party

 

Section 12.2(b)

Sellers

 

Preamble

Sellers Disclosure Letter

 

Article VI

Straddle Period

 

Section 12.9(b)(ii)

Survey

 

Section 13.4

Survival Period

 

Section 12.1(b)

Tax Claim

 

Section 12.9(c)(ii)

Third Party

 

Section 9.3

Third Party Claim

 

Section 12.4(a)

Third Party Purchaser

 

Section 11.2(d)

Trademark Assignment Agreement

 

Section 5.2(f)

Transfer Taxes

 

Section 9.9(a)

Transferred Employees

 

Section 9.4(a)

Transferred Intellectual Property

 

Section 1.1(h)

Transferred Marks and Domain Names

 

Section 7.7(a)

Transition Plan

 

Section 9.11(g)

Transition Functions

 

Section 9.11(g)

UCC Search

 

Section 13.1

 

Section 14.2           Governing Law; Consent to Jurisdiction; Waiver of Trial
by Jury.

 

(a)           This Agreement and the transactions contemplated hereby, and all
disputes between the parties under or related to this Agreement or the facts and
circumstances leading to

 

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its execution, whether in contract, tort or otherwise, shall be governed by and
construed in accordance with the Laws of the State of Missouri, applicable to
contracts executed in and to be performed entirely within the State of Missouri,
without regard to the conflicts of laws principles thereof.

 

(b)           Each of the parties hereto hereby irrevocably and unconditionally
submits, for itself and its property, to the exclusive jurisdiction of the
United States Eastern District Court for the District of Missouri, and any
appellate court thereof, in any action or proceeding arising out of or relating
to this Agreement or the agreements delivered in connection herewith or the
transactions contemplated hereby or thereby or for recognition or enforcement of
any judgment relating thereto, and each of the parties hereby irrevocably and
unconditionally (i) agrees not to commence any such action or proceeding except
in such court, (ii) agrees that any claim in respect of any such action or
proceeding may be heard and determined in such court, (iii) waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any such action or proceeding in
such court, (iv) waives, to the fullest extent permitted by Law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in such
court, and (v) to the extent such party is not otherwise subject to service of
process in the State of Missouri, appoints Corporation Service Company as such
party’s agent in the State of Missouri for acceptance of legal process and
agrees that service made on any such agent shall have the same legal force and
effect as if served upon such party personally within such state. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by Law. Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices in
Section 14.3 hereof. Nothing in this Agreement will affect the right of any
party to this Agreement to serve process in any other manner permitted by Law.

 

(c)           EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH
MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE IT 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. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE EITHER OF SUCH WAIVERS, (ii) IT UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF SUCH WAIVERS, (iii) IT MAKES SUCH WAIVERS VOLUNTARILY, AND
(iv) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 14.2(C) .

 

Section 14.3           Notices. All notices, requests, claims, demands and other
communications required or permitted to be given hereunder will be in writing
and will be given or made by delivery in person, by courier service, by
facsimile (with a copy sent by another means specified herein), or by registered
or certified mail (postage prepaid, return receipt requested). Except as

 

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provided otherwise herein, notices delivered by hand or by courier service shall
be deemed given upon receipt; notices delivered by facsimile shall be deemed
given twenty-four (24) hours after the sender’s receipt of confirmation of
successful transmission; and notices delivered by registered or certified mail
shall be deemed given seven (7) days after being deposited in the mail system.
All notices shall be addressed to the parties at the following addresses (or at
such other address for a party as will be specified by like notice):

 

(a)           if to Buyer, to

 

Penn National Gaming, Inc.

825 Berkshire Boulevard

Suite 200

Wyomissing, Pennsylvania 19610

with copies, which shall not constitute notice, to:

 

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, New York 10019

Attn: Daniel A. Neff

Facsimile: (212) 403-2000

 

(b)           if to Parent, Sellers, or the Company (prior to the Closing), to

 

Caesars Entertainment Corporation

One Caesars Palace Drive

Las Vegas, Nevada 89109

Attention: General Counsel

Facsimile: (702) 407-6418

 

with a copy to:

 

Latham & Watkins LLP

650 Town Center Drive

20th Floor

Costa Mesa, California 92626

Attention: Charles K. Ruck and Michael A. Treska

Facsimile: (714) 755-8290

 

Section 14.4           Interpretation. When a reference is made in this
Agreement to Sections, Exhibits or Schedules, such reference shall be to a
Section or Exhibit or Schedule of this Agreement unless otherwise indicated. All
Exhibits and Schedules of this Agreement are incorporated herein by reference.
The table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. Whenever the words “include,” “includes” or “including” are used
in this Agreement they shall be deemed to be followed by the words “without
limitation.” The phrase “made available” in this Agreement shall mean that the
information referred to has been made available if requested by the party to
whom such information is to be made available. Buyer, Sellers and the Company
will be referred to herein individually as a “party” and collectively as
“parties” (except where the context otherwise requires).

 

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Section 14.5           Entire Agreement. This Agreement and all documents and
instruments referred to herein constitute the entire agreement and supersede all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof; provided that the Confidentiality
Agreement shall remain in full force and effect after the Closing. Each party
hereto agrees that, except for the representations and warranties contained in
this Agreement and the Company Disclosure Letter, neither Sellers, the Company,
nor Buyer makes any other representations or warranties, and each hereby
disclaims any other representations and warranties made by itself or any of its
respective Representatives or other representatives, with respect to the
execution and delivery of this Agreement or the transactions contemplated
hereby, notwithstanding the delivery or disclosure to any of them or their
respective representatives of any documentation or other information with
respect to any one or more of the foregoing.

 

Section 14.6           Severability. 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.

 

Section 14.7           Assignment. Without the prior written consent of the
other party, neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by operation of Law (including by
merger, consolidation or a change of control) or otherwise; provided, however,
Buyer may assign any of its rights in whole or in part to one or more of Buyer’s
direct or indirect wholly owned Subsidiaries; provided, further that no such
assignment shall relieve Buyer of any of its obligations hereunder. Any
assignment in violation of the preceding sentence shall be void and no
assignment shall relieve the assigning party of any of its obligations
hereunder.

 

Section 14.8           Parties of Interest. Except as set forth in ARTICLE XII
hereof, 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.

 

Section 14.9           Counterparts. This Agreement may be executed by facsimile
or electronic mail transmission and/or in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement.

 

Section 14.10         Mutual Drafting. 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 that 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

 

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favoring or disfavoring any party by virtue of the authorship of any of the
provisions of this Agreement.

 

Section 14.11         Amendment. This Agreement may be amended by Buyer and
Sellers. This Agreement may not be amended except by an instrument in writing
signed on behalf of each of Buyer and Sellers.

 

Section 14.12         Extension; Waiver. At any time prior to the Closing,
Buyer, Sellers and the Company by action taken or authorized by their respective
boards of directors may, to the extent legally allowed (i) extend the time for
or waive the performance of any of the obligations or other acts of the other
parties hereto, (ii) waive any inaccuracies in the representations and
warranties contained herein or in any document delivered pursuant hereto and
(iii) waive compliance with any of the agreements or conditions contained here.
Any agreement on the part of a party hereto to any such extension or waiver
shall be valid only if set forth in a written instrument signed on behalf of
such party.

 

Section 14.13         Time of Essence. Time is of the essence with respect to
this Agreement and all terms, provisions, covenants and conditions hereof.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be signed by
their respective duly authorized officers as of the date first written above.

 

 

BUYER

 

 

SELLERS

 

 

 

 

 

Penn National Gaming, Inc.,

 

Caesars Entertainment Operating Company, Inc.,

a Pennsylvania corporation

 

a Delaware corporation

 

 

 

 

 

By:

/s/ Robert S. Ippolito

 

By:

/s/ Jonathan S. Halkyard

Name:

Robert S. Ippolito

 

Name:

Jonathan S. Halkyard

Its:

VP/Secretary/Treasurer

 

Its:

EVP and Chief Financial Officer

 

 

 

 

 

THE COMPANY

 

Harrah’s Maryland Heights Operating Co.,

 

 

 

a Nevada corporation

Harrah’s Maryland Heights, LLC,

 

 

 

a Delaware limited liability company

 

 

 

 

 

 

 

 

By:

/s/ Jonathan S. Halkyard

 

By:

/s/ Jonathan S. Halkyard

Name:

Jonathan S. Halkyard

 

Name:

Jonathan S. Halkyard

Its:

Authorized Representative

 

Its:

SVP and Treasurer

 

 

 

 

 

PARENT

 

 

 

 

 

 

 

 

Caesars Entertainment Corporation,

 

Players Maryland Heights Nevada, LLC,

a Delaware corporation

 

a Nevada limited liability company

 

 

 

By: Players Holding, LLC, Member

By:

/s/ Jonathan S. Halkyard

 

By: Players International, LLC, Member

Name:

Jonathan S. Halkyard

 

By: Caesars Entertainment Operating

Its:

EVP and Chief Financial Officer

 

Company, Inc., Member

 

 

 

 

 

 

 

 

By:

/s/ Jonathan S. Halkyard

 

 

 

Name:

Jonathan S. Halkyard

 

 

 

Its:

EVP and Chief Financial Officer

 

Signature Page to Equity Interest Purchase Agreement

 

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