Exhibit 2.3
SECOND AMENDMENT
TO ASSET PURCHASE AGREEMENT
This SECOND AMENDMENT TO ASSET
PURCHASE AGREEMENT (this “ Amendment ”) is
made and entered into as of April 16, 2007, by and among Zia
Partners, LLC, a New Mexico limited liability company (“
Seller ”), Zia Park LLC, a Delaware limited liability
company (“ Buyer ”), and Penn National Gaming,
Inc., a Pennsylvania corporation (“ Parent Guarantor
”). Capitalized terms used but not defined in this
Amendment have the respective meanings set forth in the Purchase
Agreement (as defined below).
WHEREAS, on November 7, 2006,
Seller, Buyer, and (solely with respect to specific provisions
specified therein) Parent Guarantor entered into an Asset Purchase
Agreement, as amended by the First Amendment thereto, dated as of
April 13, 2007 (as so amended, the “ Purchase
Agreement ”); and
WHEREAS, pursuant to Section 12.11
of the Purchase Agreement, Seller, Buyer and Parent Guarantor
desire to amend the Purchase Agreement as set forth in this
Amendment.
NOW, THEREFORE, the parties hereto,
in consideration of the premises and the covenants and agreements
contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound hereby, agree as follows:
ARTICLE I
AMENDMENTS
SECTION
1.1 Amendment of
Section 1.4(a) . Amendment of Section 1.4(a). Section
1.4(a) of the Purchase Agreement is hereby deleted in its entirety
and replaced with the following:
(a)
all current Liabilities of the type set forth below and designated
on the Reference Balance Sheet as to be assumed by Buyer (the
“ Assumed Current Liabilities ”):
(i) ticket
Liabilities,
(ii) player’s club
Liabilities,
(iii) due to purse
Liabilities, and
(iv) deferred income
Liabilities;
SECTION
1.2 Amendment of
Section 3.1(c) .
Section 3.1(c) of the Purchase Agreement is hereby deleted in its
entirety and replaced with the following:
(c)
All income and expenses pursuant to the Assumed Contracts will be
prorated between Buyer and Seller as of the Closing Date on the
Preliminary Closing Balance Sheet and the Closing Date Balance
Sheet. Seller shall receive a credit on the Preliminary
Closing Balance Sheet for (a) the amount of any prepaid rents or
other amounts related to periods from and after the Closing Date
and (b) security deposits, or other deposits previously paid by
Seller under the Assumed Contracts, less any such amounts paid to
and collected by Seller under its Assumed Contracts. Any
amounts paid by Buyer under the Assumed Contracts related to any
period (or portion thereof) prior to the Closing Date shall be
promptly reimbursed by Seller to Buyer. Any
amounts received by Buyer under the
Assumed Contracts related to any period (or portion thereof) prior
to the Closing Date shall be promptly paid by Buyer to
Seller. Any amounts received by Seller under the Assumed
Contracts related to any period on or after the Closing Date shall
be promptly paid to Buyer.
SECTION
1.3 Amendment of
Article VII . Article VII of the Purchase Agreement
is hereby amended by adding the following Section
7.24:
Section
7.24
Certain Litigation . Prior to the six (6) month
anniversary of the Closing Date, Seller and Buyer shall jointly
bring suit with mutually acceptance counsel (and shall cooperate
and assist in the preparation, prosecution, and settlement, if any,
of such suit) to recover any and all Damages (including, without
limitation, incidental and consequential Damages fines) incurred or
suffered by Buyer associated with, in connection with, arising out
of or resulting from any flaws, defects, deficiencies or
inadequacies in, or any repairs or noncompliance with respect to,
the construction, design, workmanship, materials or physical
condition of, or similar matters with respect to, the barns at the
Property. Buyer and Seller shall each pay one-half of the
out-of-pocket costs and expenses (including attorneys’ fees
and court costs) incurred by them with respect to any suit brought
pursuant to this Section 7.24. The cash proceeds of any
recovery or award received by Buyer and Seller in connection with
any suit brought pursuant to this Section 7.24 shall first be used
to reimburse Buyer and Seller for all out-of-pocket costs and
expenses (including attorneys’ fees and court costs) incurred
by them with respect to such suit, and Buyer shall be entitled to
the remaining cash proceeds, if any.
SECTION
1.4 Amendment of
Section 10.2(a) . Section 10.2 (a) of the Purchase
Agreement is hereby amended by deleting the “and” at
the end of clause (iii) thereof, replacing the “.” at
the end of clause (iv) thereof with “; and” and adding
the following new clause (v) thereto:
(v)
the Specified Liabilities.
SECTION
1.5 Amendment of
Section 10.6(a) . Section 10.6(a) of the Purchase
Agreement is hereby deleted in its entirety and replaced with the
following:
(a) No
Buyer Indemnified Party shall seek, or be entitled to,
indemnification from any of the Indemnifying Parties pursuant to
Section 10.2(a) hereof unless and until the aggregate claims for
Damages of the Buyer Indemnified Parties for which indemnification
is sought pursuant to Section 10.2(a) hereof are greater than Five
Hundred Thousand United States Dollars ($500,000) (the “
Threshold ”) and then only for the excess over the
Threshold but not in excess of Ten Million United States Dollars
($10,000,000) (the “ Cap ”); provided ,
however , that neither the Cap nor the Threshold shall be
applicable to any claims for Damages of the Buyer Indemnified
Parties for which indemnification is sought with respect to (i)
Section 5.1, Section 5.2(a), Section 5.18, Section 7.17, Section
7.20, Section 7.24, Section 10.2(a)(iii) or Section 10.2(a)(iv)
hereof, (ii) any liability for Tax in respect of which a claim may
be mad
