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PURCHASE AND SALE AGREEMENT
THIS AGREEMENT is made this ___ day of October, 1996 between
JERRY WARD and CARS, INC., of Route 7, Box 516, Conroe, Texas,
EDWARD LOCKEL, of P.0. Box 19681, Houston Texas 77224, and Jim's
TRUCK AND EQUIPMENT, INC., of 3202 Hardrock Road, Grand Prairie,
Texas 75050 all of whom are citizens of the United States of
America and/or are wholly owned by citizens of the United States,
as applicable, (hereinafter jointly and severally, referred to as
the "Seller") and CREATIVE GAMING INTERNATIONAL, INC., a New
Jersey corporation, with offices located at 150 Morris Avenue,
Springfield, New Jersey 07081 (hereinafter referred to as the
"Purchaser").
WHEREAS, the Seller is the owner of M/V Cone Johnson
(hereinafter sometimes referred to as the "Vessel") which is
described as follows:
BUILT: 1950
PLACE BUILT: Galveston, Texas USA
FLAG: United States of America
HOME PORT: Galveston, Texas USA
OFFICIAL No: 259819
GROSS/NET TONS: 797/542
LENGTH/BEAM/DRAFT: 237' 6"/6' '0"/13" 0"
CLASSIFICATION SOCIETY: American Bureau of Shipping
AI River Service (AMS) (vessel
is presently out of class)
WHEREAS, the Seller is desirous of selling M/V Cone Johnson
and the Purchaser is desirous of purchasing M/V Cone Johnson;
IT IS THEREFORE AGREED as follows:
1. PURCHASE PRICE. The Seller hereby agrees to sell M/Y
Cone Johnson to the Purchaser for the Purchase Price of FOUR
HUNDRED SIXTY FIVE THOUSAND AND 00/100 ($465,000.00) DOLLARS.
The Purchase Price shall be paid as follows:
a. $25,000.00 cash presently being
held in the Goldring & Goldring, P.A.
Attorney Trust Account, subject to the
terms and conditions of Term Sheet
previously executed between Seller and
Purchaser and this Agreement; and,
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b. $440,000.00 in certified or wire
transferred funds subject to the terms
of this Agreement.
2. PAYMENT. The Purchase Price shall be paid to the Jim
Jones Attorney Trust Account contemporaneously with the delivery
of the Vessel to the Purchaser. The Purchase Price shall,
however, be held and remain in escrow until the Vessel has left
the waters of the State of Texas; with the Purchaser obligated to
remove the Vessel from said waters with all due diligence and
dispatch. If, however, the Purchaser is reasonably able to
remove the Vessel from said waters, but fails to do so within
forty eight (48) hours of the delivery of the Vessel to it, the
escrowed funds shall be released to the Seller; provided,
however, that the Seller, its agents, employees, representatives
and/or principals have done nothing to prevent, hinder or
otherwise delay the Purchaser's removal of the Vessel from said
waters (including the Seller's failure to remove any and all
liens of any kind from the Vessel and/or any claims of such a
lien).
3. REPRESENTATIONS. a. The Seller represents that the
Vessel includes all tackle, apparel. furniture and equipment,
bunkers and lubricating oils, wherever same may be, including,
but not limited to:
Two Cooper-Bessemer JS-6-T Diesel Electric
Propulsion Engines
All generators
All pumps
All electrical equipment
All propellers
Two magnetic compasses
Two Raytheon 6410 radars
Life saving equipment
Firefighting equipment
All spares
b. The Seller further expressly represents and
warrants that M/Y Cone Johnson was constructed in the United
States of America and that neither its present or any prior
ownership is of such character as to jeopardize or prohibit the
vessel from operating as a United States documented vessel with
coastwise trade endorsement. The Seller shall, in that regard,
provide the Purchaser with a complete, current and up-to-date:
Certificate of Documentation and Certificate of Ownership with
General Index of Abstract of Title within ten (10) days of the
full execution of this Agreement or as soon as possible
thereafter; same shall reflect the ultimate title holder of the
Vessel such that all interim title holders since the Vessel was
owned by the State of Texas (whether they be including within the
definition of the Seller herein or not) are reflected on the
subject documents.
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c. The Seller further represents that:
i. It, and each individual and entity which
is included within the definition of the Seller, has the full
power and legal authority to execute and fully perform this
Agreement;
ii. It has good and marketable title to the
Vessel;
iii. It has or will obtain permission from
any required authority to sell the vessel;
iv. The Vessel will be sold free and clear
of any and all mortgages, liens, bills, encumbrances or claims
whatsoever- (Any such items in relation to M/Y Cone Johnson may
be paid off from the proceeds from this sale.);
v. It shall deliver the Vessel and its inventory at the time
of the closing;
vi. It shall pay any and all taxes, fees, or other charges
assessed against the Vessel or this transaction by any governmental authority
prior to or at the closing, shall hold the Purchaser harmless against any
claims for same and shall provided proof of the payment of same, upon the
request of the Purchaser, no later than ten (10) days after the closing;
vii. It shall hold the Purchaser and the Vessel harmless
and defend same against any and all claims incurred prior to, or
regarding the period prior to, the closing that may impair or adversely
affect the Purchaser's receipt, use and possession of the Vessel,
including its good and absolute title thereto, and to indemnify the
Purchaser and the Vessel and to assume all costs incident to defending
them against any and all such claims, including their reasonable
attorneys fees and costs;
viii. It shall pay all sales and/or use taxes previously, now or
hereafter imposed or assessed upon the Vessel as a result of this
sale, or a prior transfer/sale and/or operations of said Vessel
and to indemnify and hold the Purchaser and the Vessel harmless
from any obligation to pay any such taxes; and,
ix. It shall not claim any ownership or
possessory interest in the Vessel after the completion of the
closing.
d. The Seller makes no representations whatsoever as
to the Vessel's quality, condition, seaworthiness, or fitness for
any particular purpose except as expressly set forth herein.
e. This Paragraph and the representations, warranties and
covenants shall survive the closing.
4. SURVEYS AND TRIALS. a. The Purchaser shall have the
right to perform whatever tests and inspections it deems
necessary or appropriate to determine both the quality of the
Vessel, its tackle, apparel, and equipment and its fitness of the
Purchaser's specific intended purpose (which generally is as an
offshore gaming vessel).
a. The Purchaser agrees that the surveyor(s) it
selects shall be employed and/or retained by it and that as a
condition of said employment/retention all work performed
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shall be for the its account and not, under any circumstances, for the
account of the Vessel or the Seller.
b. All trials shall be at the expense of the
Purchaser. The Vessel shall, however, at all times during the
sea trial be under the care and control of the owner or owner's
captain, or such other qualified person which the Seller may
require to be present, who shall accommodate any and all
reasonable and customary requests by the Purchaser and/or its
agents.
c. All inspections and trials shall be completed
within no later than OCTOBER 29, 1996.
d. The party making the survey and/or trial shall
indemnify and hold the Seller and the Vessel harmless from any
and all damages or claims made as a result of same.
e. The parties shall fully cooperate with each other
both as to the surveying and trialing of the Vessel.
5. ACCEPTANCE OF VESSEL. If the Purchaser, in its sole
and absolute discretion, deter-mines by OCTOBER 29, 1996 that the
Vessel, its tackle, apparel, or equipment is not of the quality
it desires or is not fit for its specific intended purpose, the
Purchaser shall have the option to terminate the transaction
without having any further obligation or liability to Seller. If
the Purchaser does not so notify the Seller of its rejection of
the Vessel then it shall been deemed to have accepted same.
b. If the Purchaser elects to terminate this
transaction on or before OCTOBER 29, 1996 the Purchaser have
returned to it the $25,000.00 being held in escrow, this
Agreement shall terminate and neither party shall have any
further obligation to the other.
c. The Purchaser's acceptance or rejection of the
Vessel shall be made in its sole and absolute discretion.
6. DELIVERY OF VESSEL. The Vessel shall be delivered at
the time of the closing, with all of its tackle, apparel,
furniture and equipment, bunkers and lubricating oils on board,
at the dock where it is was located at the time of the
execution of the Term Sheet-, provided however that it shall be
safely afloat, fully accessible, and with free, clear and readily
navigable access to the open waters of the Gulf of Mexico.
7. CLOSING. The closing shall take place on or before
NOVEMBER 14, 1996 at a time and place to be agreed upon by the
parties. The closing shall be deemed completed upon the
following having occurred:
a. All documents necessary to transfer good and
absolute title to the Vessel have been received by the Purchaser,
including, but not necessarily limited to:
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i. Coast Guard Bill of Sale;
ii. Original Coast Guard Document, Certificate
of Inspection and Abstract;
iii. Quit Claim Bills of Sale from each
individual or entity defined as a Seller herein-, and,
iv. Such other documents and things which are
customarily provided by a Seller to a Buyer in such a
transaction.
b. The Seller's attorney, Jim Jones, Esquire, has
received into his trust account $465,000.00 in certified or wire
transferred funds.
8. RISK OF LOSS. Except as otherwise provided for herein
the Seller shall bear all risk of loss or damage to the Vessel,
or to any person or property on the Vessel, until the closing.
Any damage to the, Vessel subsequent to the acceptance of the
Vessel by the Purchaser shall be repaired by the Seller at the
Seller's sole and absolute expense or Seller shall credit
Purchaser against the Purchase Price an amount equal to the cost
of the repairs, subject however to the reasonable approval by the
Purchaser. If the cost to reasonably repair any such damage
exceeds $50,000.00 the Purchaser shall have the right to
terminate this Agreement in accordance with Paragraph 5 hereof.
If the Vessel becomes an actual, constructive or compromised
total loss before delivery, the monies held in escrow shall be
returned to the Buyer and this Agreement shall be terminated
without cost to either party.
9. DEFAULT. If either party fails or refuses to perform
in accordance with the terms and conditions of this Agreement it
shall be liable to the other party for, among other things, all
of the other party's costs associated with the surveying and
trialing of the Vessel, actual and consequential damages and
attorneys fees and costs. The defaulting party shall also
indemnify and hold the other party harmless for any and all
claims for brokerage commissions, whether actually due and
payable or not. Due to the unique characteristics of each of the
Vessel which is the subject of this Agreement, the parties hereto
agree that they would not be fully compensated by a monetary
award and therefore enforcing this Agreement by way of specific
performance is an appropriate remedy.
10. BROKERAGE. The parties hereto acknowledge that the
only brokers they have utilized in relation to this transaction
are:
Crozier Fox, of Northrup & Johnson
Edward Lockel
Jim's Truck and Equipment, Inc.
Marcon International
The Seller is solely and exclusively obligated to pay it a
commission as is set forth in a separate agreement; same to be
paid out of the escrowed funds which are to be held by the
Seller's attorney
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after same are released from escrow as set forth herein. The
Seller indemnifies and holds the Buyer and the Vessel harmless
for any commissions which may be due in relation to this transaction.
Each party agrees to indemnify and hold the other party harmless
for any claims for a commission, fee or other compensation in
relation to, or in connection with, this transaction. by any
undisclosed broker it utilized, as well as for reasonable attorneys
fees and costs.
11. NO ASSIGNMENT. This Agreement may not be assigned
without the express written consent of the other party.
12. NOTICES. All notices required by, or otherwise given
under, this Agreement must be in writing and transmitted to the
other party overnight or same day via a nationally recognized
courier service such as Federal Express or United Parcel Service
and to their respective attorneys as follows:
As to the Seller:
Mr. Jerry Ward
Route 7, Box 516
Conroe, Texas 77384
Jim Jones, Esquire
130 Catalpa
Lake Jackson, Texas 77566
As to the Purchaser:
Peter Jegou, C.E.O.
Creative Gaming International, Inc.
150 Morris Avenue
Springfield, New Jersey 07081
Eric J. Goldring, Esquire
Goldring & Goldring, P.A.
125 Half Mile Road
Red Bank, New Jersey 07701-6749
(908) 530-5400
and, simultaneously via facsimile transmission to the respective
facsimile numbers noted below:
Seller: (713) 351-7763
Seller's Attorney: (409) 265-2304
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Purchaser: (908) 467-5650
Purchaser's Attorney: (908) 530-0614
All notices shall be deemed effective upon actual receipt and, as
such, confirmation that a notice has been sent via facsimile is
not conclusive that the transmission has, in fact, been received
or that it has been received in sufficiently legible and complete
condition. In the event that a party, or its attorney, does not
receive either the written notice and/or the facsimile
transmission because it either is not available to accept or
receive, or does not accept or receive, same, notice shall be
deemed effective upon depositing same with the nationally
recognized courier service and a documented attempt to transmit
the facsimile copy of same.
13. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement between the parties. Each party agrees that it has not
relied upon any representations made to it other than as is set
forth in this Agreement and the exhibits attached hereto.
14. NO MODIFICATION. This Agreement may only be modified
in writing signed by each of the parties. No purported oral
modification of this Agreement shall be of any force or effect.
IN WITNESS WHEREOF the parties hereto set their hand and
seal on the date first written above.
CREATIVE GAMING INTERNATIONAL, INC., Purchaser
By:_________________ ___________________________
Peter Jegou, C.E.O. JERRY WARD, Seller
CARS, INC., Seller
By:________________________
Jerry Ward, President
JIM'S TRUCK AND EQUIPMENT, INC., Seller
By:__________________________
James Elmore, President
_______________________
EDWARD LOCKEL, Seller