ASSET
PURCHASE AGREEMENT
By
this
Asset Purchase Agreement, Game Financial Corporation, a Minnesota corporation
(“Game Financial”), Chex Services, Inc., a Minnesota corporation (“Chex”), and
FastFunds Financial Corporation, a Nevada corporation (“FastFunds” and sometimes
referred to collectively with Chex as the “Chex Entities” and individually as a
“Chex Entity”), agree as follows:
1. Introduction.
The
Chex Entities desire to sell certain assets used in connection with the
Business, including Contracts and the Software, and Game Financial desires
to
purchase those assets, all as further described and upon the terms and
conditions set forth in this Agreement.
2. Effective
Date.
This
Agreement is effective as of December 22, 2005 (the “Effective
Date”).
3. Definitions.
When
used in this Agreement, the following capitalized terms shall have the
respective meanings set forth below:
“Action”
means
any claim, action, suit, complaint, counter-claim, petition, set-off,
administrative proceeding, arbitral action, governmental inquiry, criminal
prosecution or other investigation, whether conducted by or before a
Governmental Authority or other Person.
“Actual
Cash Amount”
has
the
meaning set forth in Subsection
4.3(c).
“Affiliate”
means,
with respect to a Person: (i) any other Person directly or indirectly
controlling, controlled by, or under common control with, such Person;
(ii) any
other Person that owns or controls five percent (5%) or more of any class
of
equity securities (including any equity securities issuable upon the exercise
of
any option or convertible security) of such Person or any of its Affiliates;
or
(iii) any director, partner, member, executive officer, or limited liability
company manager of such Person. For the purposes of this definition, “control”
(including, with correlative meanings, the terms “controlling,” “controlled by,”
and “under common control with”) means, with respect to any Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through
ownership of voting securities, by contract or otherwise.
“Agreement”
means
this Asset Purchase Agreement and all of its schedules and
exhibits.
“Ancillary
Agreements”
means,
collectively the (i) the Bills of Sale and Assignment Agreements; (ii)
all
documents, agreements, instruments and papers described in Subsection
9.1;
(iii)
the assumption of liability documents described in Subsection
9.2(e),
(iii)
the Voting Agreements of the date hereof, executed by FastFunds and Equitex
(the
“Voting Agreements”), and (iv) the Guaranty Agreement, of the date hereof,
between Equitex and Game Financial (the “Guaranty Agreement”).
“Acquisition
Proposal”
has
the
meaning set forth in Subsection
11.3(c).
“Assets”
has
the
meaning set forth in Subsection
4.1(a).
“Assumed
Contracts”
means
the Material Business Contracts that Game Financial will assume pursuant
to this
Agreement, which are listed on Schedule
3.
“Assumed
Liabilities”
has
the
meaning set forth in Subsection
4.2(a).
“Balance
Sheet”
has
the
meaning set forth in Subsection
6.10.
“Basket”
has
the
meaning set forth in Subsection 10.7.
“Benefit
Plan”
means
any Plan that is sponsored, maintained or contributed to or required to
be
contributed to by Chex or a Chex Entity or to which Chex or a Chex Entity
is a
party, or with respect to which Chex or a Chex Entity has any other similar
comparable obligation or liability (fixed, contingent or otherwise), whether
written or oral, for the benefit of any Business Employee.
“Bills
of Sale and Assignment Agreements”
has
the
meaning set forth in Subsection
9.1(e).
“Business”
means
the Chex Entities’ business of providing cash-access financial services,
including full booth financial services, check cashing and electronic cash
conversion, automated teller machine access, and credit/debit card cash
advances
primarily in gaming establishments throughout the world, including the
provision
of those services in: Arizona, Antigua, California, Connecticut, Cyprus,
Florida, Michigan, Minnesota, Nebraska, New Mexico, North Dakota, Oklahoma,
Ontario, St. Maarten, Texas and Wisconsin.
“Business
Day”
means
any day other than Saturday, Sunday or any day on which a U.S. national
banking
association is required or authorized to be closed.
“Business
Employees”
has
the
meaning set forth in Subsection
6.8(b).
“Business
Insurance Policies”
has
the
meaning set forth in Subsection
6.15.
“Business
Licenses”
has
the
meaning set forth in Subsection
4.1(a)(ii).
“Chex”
has
the
meaning set forth in the preamble to this Agreement.
“Chex
Entities”
has
the
meaning set forth in the preamble to this Agreement.
“Chex
Indemnified Party”
has
the
meaning set forth in Subsection
10.1.
“Chex
Marks”
means
all Marks of the Chex Entities used in connection with the Business, including
those names, marks and logos set forth in Schedule
4.1(a)(v)
and the
names “Chex,” “FastFunds,” ChexGuard, and CreditGuard.
“Closing”
has
the
meaning set forth in Subsection
5.1.
“Closing
Cash Payment”
has
the
meaning set forth in Subsection
5.2.
“Closing
Date”
has
the
meaning set forth in Subsection
5.1.
“Confidentiality
Agreement”
means
the June 24, 2005 Confidentiality Agreement executed by Equitex, FastFunds
and
Certegy, Inc.
“Contract”
means
any contract, agreement, indenture, note, bond, instrument, lease, conditional
sales contract, mortgage, license, franchise agreement, concession agreement,
insurance policy, security interest, guaranty, binding commitment or other
agreement or arrangement, whether written or oral.
“Effective
Date”
has
the
meaning set forth in Section
2.
“Environmental
Law”
means
any applicable Law relating to pollution, the protection of human health
and/or
the environment, or the spilling, leaking, pumping, pouring, emitting,
emptying,
discharging, injecting, escaping, leaching, dumping or disposing of a Hazardous
Substance into the environment.
“Equitex”
means
Equitex, Inc., a Delaware corporation and stockholder of FastFunds.
“Estimated
Cash Amount”
has
the
meaning set forth in Subsection
4.3(c).
“Excluded
Assets”
has
the
meaning set forth in Subsection
4.1(b).
“Excluded
Liabilities”
has
the
meaning set forth in Subsection
4.2(b).
“FastFunds”
has
the
meaning set forth in the preamble to this Agreement.
“Fidelity”
means
Fidelity National Financial, Inc. and/or Fidelity National Information
Services,
Inc.
“Financial
Information”
has
the
meaning set forth in Subsection
6.10.
“GAAP”
means
United States generally accepted accounting principles, as in effect from
time
to time.
“Game
Financial”
has
the
meaning set forth in the preamble to this Agreement.
“Game
Financial Indemnified Party”
has
the
meaning set forth in Subsection
10.2.
“Governmental
Authority”
means
any government, any governmental entity, department, commission, board,
agency
or instrumentality, and any court, tribunal or judicial body, in each case
whether federal, state, county, provincial, local or foreign.
“Governmental
Order”
means
any statute, rule, regulation, order, judgment, injunction, decree, stipulation
or determination issued, promulgated or entered by or with any Governmental
Authority of competent jurisdiction.
“Guaranty
Agreement”
has
the
meaning given above.
“Hazardous
Substance”
means
petroleum, petroleum by-products, polychlorinated biphenyls and any other
chemicals, materials, substances or wastes that are currently defined or
regulated as hazardous substances, hazardous materials, hazardous wastes,
extremely hazardous wastes, restricted hazardous wastes, toxic substances,
toxic
pollutants, toxic air pollutants, hazardous air pollutants, pollutants,
or
contaminants under any Environmental Law.
“Indemnified
Claim”
has
the
meaning set forth in Subsection
10.3(a).
“Indemnified
Party”
has
the
meaning set forth in Subsection
10.3(a).
“Indemnifying
Party”
has
the
meaning set forth in Subsection
10.3(a).
“Indemnity
Notice Period”
has
the
meaning set forth in Subsection
10.3(a).
“Information
Statement”
has
the
meaning set forth in Subsection
8.15(b).
“Intellectual
Property”
means
any: (i) patents, patent applications, patent disclosures and improvements
thereto; (ii) Marks; (iii) copyrights and copyrightable works, and any
registrations and applications for registration thereof; and (iv) URL’s and
Internet web sites, and the hypertext markup language (“HTML”) files, graphics,
text files and documentation associated with such Internet web
sites.
“Knowledge”
means,
with respect to any representation, warranty or statement by a party contained
herein, that such representation, warranty or statement is made to the
actual
knowledge of the party and its executive management after a reasonable
investigation.
“Law”
means
any applicable federal, state, county, provincial, local or foreign statute,
law, ordinance, regulation, rule, code or rule of common law.
“Liability”
means
any indebtedness, obligation or other liability (whether absolute, accrued,
matured, contingent, known, or unknown, fixed or otherwise, or whether
due or to
become due), including, without limitation, any fine, penalty, judgment,
award
or settlement respecting any judicial, administrative or arbitration proceeding,
damage, loss, claim or demand with respect to any Law.
“License”
means
any franchise, approval, permit, order, authorization, consent, license,
registration or filing, certificate, variance and any other similar right
obtained from or filed with any Governmental Authority or private
organization.
“Lien”
means
any security interest, pledge, mortgage, lien, charge, adverse claim of
ownership or use, restriction on transfer (such as a right of first refusal
or
other similar right), defect of title, or other encumbrance of any kind
or
character.
“Losses”
has
the
meaning set forth in Subsection
10.1.
“Marks”
means
all imprints, titles, names, trade names, service marks, trade dress, logos,
trade names, corporate names and domain names, the goodwill associated
therewith, and any registrations and applications for registration
thereof.
“Material
Adverse Change”
means
any change in or effect on the Assets or the Business that is, individually
or
in the aggregate, materially adverse to the Business, Assets or the operation,
prospects, condition (financial or otherwise) or results of the Business
or
Assets.
“Material
Business Contracts”
has
the
meaning set forth in Subsection
6.6(a).
“Merger”
means
the merger transaction entered into and effected on June 7, 2004 among
FastFunds
(f/k/a Seven Ventures, Inc.), Seven Ventures Newco, Inc., a Minnesota
corporation, and Chex.
“Notice
of Superior Proposal”
has
the
meaning set forth in Subsection
11.3(c).
“Organizational
Documents”
means:
(a) the articles or certificate of incorporation or registration and the
bylaws
of a corporation; (b) the partnership agreement and any statement of partnership
of a general partnership; (c) the limited partnership agreement and the
certificate of limited partnership of a limited partnership; (d) any charter
or
similar document adopted or filed in connection with the creation, formation,
or
organization of a Person; and (e) any amendment to the foregoing.
“Original
Disclosure Schedules”
has
the
meaning set forth in Subsection
8.18(a).
“Permitted
Liens”
means:
(i) mechanics’ and materialmen’s liens and workmen’s, repairmen’s,
warehouseman’s and carriers’ liens arising in the ordinary course of business,
the obligations of which are not overdue or otherwise delinquent; and (ii)
Liens
for Taxes not yet due and payable or being contested in good faith (it
being
understood that all Tax Liabilities of the Chex Entities are Excluded
Liabilities).
“Person”
means
any individual, general or limited partnership, firm, corporation, limited
liability company or partnership, association, trust, unincorporated
organization or other entity.
“Plan”
means
any deferred compensation, bonus or other incentive compensation plan,
program,
agreement or arrangement; any severance or termination pay, medical, surgical,
hospitalization, life insurance and other “welfare” plan, fund or program; any
profit-sharing, stock bonus or other “pension” plan, fund or program; any
employment, termination or severance agreement or arrangement; and any
other
employee benefit plan, fund, program, agreement or arrangement.
“Proprietary
Rights”
means:
(i) Intellectual Property rights; (ii) trade secrets and confidential business
information (including ideas, formulas, compositions, inventions (whether
patentable or unpatentable and whether or not reduced to practice), know-how,
databases, analytics, research and development information, software, drawings,
specifications, designs, plans, proposals, technical data, marketing plans
and
customer and supplier lists and information; (iii) copies of tangible
embodiments thereof (in whatever form or medium); and (iv) licenses granting
any
rights with respect to any of the foregoing.
“Prospects”
has
the
meaning given in Section
12.15.
“Purchase
Price”
has
the
meaning set forth in Subsection
4.3(a).
“Recipients”
has
the
meaning set forth in Subsection
8.3.
“Required
Consents”
has
the
meaning set forth in Subsection
6.3.
“Software”
has
the
meaning set forth in Subsection
4.1(a)(x).
“Stockholders
Approval”
has
the
meaning set forth in Subsection
8.15(a).
“Stockholders
Meeting”
has
the
meaning set forth in Subsection
8.15(b).
“Stub
Statements”
has
the
meaning set forth in Subsection
6.10.
“Subsidiary”
means,
with respect to any Person, any corporation, general or limited partnership,
limited liability company, joint venture or other legal entity of any kind
of
which such Person (either alone or through or together with one or more
of its
other Subsidiaries) owns, directly or indirectly, more than 50% of the
stock or
other equity interests, the holders of which are: (i) generally entitled
to vote
for the election of the board of directors or other governing body of such
legal
entity; or (ii) generally entitled to share in the profits or capital of
such
legal entity.
“Supplemental
Disclosure Schedule”
has
the
meaning set forth in Subsection
8.18.
“Superior
Proposal”
has
the
meaning set forth in Subsection
11.3(c).
“Tax”
means
any federal, state, county, provincial, local or foreign income, gross
receipts,
sales, use, ad valorem, employment, severance, transfer, gains, profits,
excise,
franchise, property, capital stock, premium, minimum and alternative minimum
or
other taxes, fees, levies, duties, assessments or charges of any kind or
nature
whatsoever imposed by any Governmental Authority (whether payable directly
or by
withholding), together with any interest, penalties (civil or criminal),
additions to or additional amounts imposed by, any Governmental Authority
with
respect thereto.
“Tax
Return”
means
a
report, return, or other information required to be supplied to a Governmental
Authority with respect to any Tax.
“Termination
Date”
has
the
meaning set forth in Subsection
11.1.
“Termination
Fee”
has
the
meaning set forth in Subsection
11.3(b).
“Transferred
Employees”
has
the
meaning set forth in Subsection
8.7.
“Voting
Agreements”
has
the
meaning given above.
“3
in 1
Software”
means
any Chex Entities’ ATM software operating on an ATM wherein: (i) a consumer can
be denied access to cash or other item of value at said ATM based upon
any
pre-set limit, including issuer or association imposed restraints on the
consumer’s use of his or her credit card, charge card, on-line debit card,
off-line debit card or other access device but can subsequently be granted
access to the same account, or another account, for the desired cash or
item of
value following a prompt,
question
or a roll-over wherein the consumer uses the same or a different credit
card,
charge card, on-line debit card, off-line debit card or access device (even
if
classified as the same transaction type); and (ii) the cash or item of
value is
provided to the consumer at a money location separate from the ATM terminal
running the Chex Entities’ ATM software.
4. Purchase
and Sale.
4.1 Purchase
and Sale of Assets.
(a) Purchase
and Sale.
Subject
to the terms and conditions set forth in this Agreement, at the Closing
Game
Financial shall purchase from the Chex Entities and the Chex Entities shall
irrevocably sell, convey, transfer, assign and deliver to Game Financial,
free
and clear of all Liens, other than Permitted Liens, all right, title and
interest in and to the following assets (collectively, the “Assets”):
(i)
the
tangible assets described
in Schedule
6.4;
(ii)
all Licenses issued to or possessed by a Chex Entity or required for the
operation of the Business or use of the Assets and all rights thereunder
(each,
a “Business License” and, collectively, the “Business Licenses”), except as set
forth on Schedule
4.1(a)(ii);
(iii)
all rights in, to and under the Assumed Contracts; (iv) all marketing,
sales and
promotional literature, market research studies, and subscriber research;
books,
records, files, documents, financial records, bills, accounting, internal
and
audit records relating to the Business (excluding Tax Returns); personnel
records relating to Transferred Employees (but only to the extent permitted
under applicable law); databases, operating manuals, customer and supplier
lists
and files relating to the Business, including customer lists, documents
and
records relating to past, present and prospective clients, such lists to
be in
both printed form and computer media ; (v) all Intellectual Property and
Proprietary Rights used or useful in connection with the Business and the
Chex
Marks, all of which are set forth on Schedule
4.1(a)(v),
and all
goodwill associated therewith, rights thereunder, remedies against infringements
thereof, and rights under applicable Laws of all jurisdictions; (vi) all
prepaid
expenses, deposits and charges relating to the Business, except as otherwise
specified on Schedule
4.1(a)(vi);
(vii)
all rights, claims, credits, causes of action or rights of set-off against
third
parties relating to the Business or Assets, including claims pursuant to
warranties, awards, advances, bonds, deposits, representations and guarantees
made by suppliers, manufacturers, contractors and other third parties in
connection with products or services purchased by or furnished for the
Business
but not, in any event, claims under the Business Insurance Policies (subject
to
Subsection
8.9
below)
or any Contracts included in the Excluded Assets or the litigation against
Lisa
Maulson (MN Case No. CT-03-020211) and the Howards (FL Case No. CACE 05-09184);
(viii) all claims, rights and choses in action relating to the Assets against
any Person, whether matured or unmatured, direct or indirect, known or
unknown,
absolute or contingent; (ix) all software, software systems, web-site
applications, databases and database systems, whether owned, leased, or
licensed
and relating to the Business, including, but not limited to, all editorial,
sales and design software, all of which are listed on Schedule
4.1(a)(ix)
(the
“Software”); (x) all accepted bids, work in process and outstanding proposals
relating to the Business or Assets; (xi) all goodwill associated with the
Business and/or the Assets; and (xii) all tangible and intangible property
used
in or useful to the Business other than the property identified on Schedule
4.1(a)(xii).
(b) Excluded
Assets.
Notwithstanding anything to the contrary in this Agreement, the Assets
shall not
include the following assets owned by a Chex Entity (together with the
assets
listed on exclusionary schedules under Subsection 4.1 above, collectively
referred to as the “Excluded
Assets”):
(i) all cash, cash equivalents (including checks) and securities (including
ownership and equity participation rights in other companies), vault cash,
and
cash on hand in automated teller machines; (ii) all bank and other depository
accounts; (iii) all accounts receivable and receivables due from Chex
Affiliates; (iv) refunds of Taxes and Tax loss carry forwards; (v) Business
Insurance Policies or other insurance policies relating to the Business,
any
refunds paid or payable in connection with the cancellation or discontinuance
of
any insurance policies applicable to the Business, and any claims made
under any
such insurance policies (other than “occurrence” based claims which are subject
to Subsection
8.9);
(vi)
the Benefit Plans and rights in assets associated with or allocated to
the
Benefit Plans ; (vii) rights under this Agreement, the Ancillary Agreements,
the
Purchase Price, or any agreement, certificate, instrument or other document
executed and delivered by Game Financial in connection with the transactions
contemplated by this Agreement; (viii) Chex Entities’ corporate record and
minute books, stock registers, stock-transfer records and related files
and
records;(ix) the Maulson and Howard litigation described Subsection
4.1(a)(vii) above);
and (x)
the
royalty-free, non-exclusive, non-transferable (except to a parent or subsidiary
of a Chex Entity) right to retain a copy to use the customer database of
the
Chex Entities transferred to Game Financial (and for such use, the right
to make
and retain a copy thereof), but only for non-gaming-related purposes and
only
consistent with Subsection 8.11 below; provided, however, that the terms
and
conditions of this right to use shall be as mutually agreed by the parties
prior
to Closing (and the parties shall negotiate in good faith with respect
to that
agreement) and that such right is conditioned on being consistent with
applicable Law.
4.2
Assumption
of Liabilities.
(a) Assumption.
Subject
to the terms and conditions set forth in this Agreement, at the Closing
Game
Financial shall assume from the Chex Entities only (I) the Liabilities
contained
in Schedule
4.2(a),
and
(II) the following Liabilities that exist at Closing to the extent that
they
relate to the Business and the Assets (collectively, the “Assumed Liabilities”):
all Liabilities first arising after the Closing Date and not resulting
from the
transactions contemplated by this Agreement under: (A) the Assumed Contracts,
and (B) all Contracts entered into after the Effective Date of this Agreement
that are not Assumed Contracts but that Game Financial has agreed to assume,
in
accordance with the terms of this Agreement; except to the extent 1) they
arise
out of any breach, act, omission or default by a Chex Entity; or 2) the
associated Liabilities should have been paid, performed or otherwise discharged
on or prior to the Closing Date. It is understood and agreed that nothing
in
this subsection shall constitute a waiver or release of any claims arising
out
of the contractual relationships between the Chex Entities and Game
Financial.
(b) Excluded
Liabilities.
Except
for the Assumed Liabilities, Game Financial shall not assume or in any
way be
responsible for any Liabilities of the Chex Entities or their Affiliates
(whether or not disclosed on a schedule). Without limiting the foregoing,
and
notwithstanding anything in Subsection
4.2(a)
to the
contrary, the Assumed Liabilities shall not include, and Game Financial
shall
not assume, any of the following Liabilities (collectively, “Excluded
Liabilities”) of the Chex Entities or their Affiliates: (i) any Liabilities with
respect to the Excluded Assets; (ii) any Liabilities with respect to Taxes
of
any nature; (iii) any Liabilities or responsibilities relating to the employment
or termination of employment by a Chex Entity or its Affiliate of any Person
attributable to any action or inaction by a Chex Entity or its Affiliates
on or
prior to the Closing Date, including with respect to any Benefit Plan or
arrangement of the Chex Entities or their Affiliates, or any severance
retention, stay bonus or similar obligations owed by a Chex Entity or its
Affiliates to any Person (including any Transferred
Employees);
(iv) any Liability in connection with this Agreement or any other agreement
for
legal, accounting or broker’s fees, Taxes or other transaction costs incurred in
connection with this Agreement or the consummation of the transactions
contemplated by this Agreement; (v) any Liability owed to any shareholder
or
former shareholder of a Chex Entity or to any of their current or former
Affiliates; (vi) any obligations with respect to bank accounts; (vii) any
Liabilities resulting from any Action (whether or not pending or threatened
on
the date hereof and whether or not disclosed on any schedule); (viii) any
Liabilities arising under or in connection with the Assumed Contracts that
result from an act, omission, breach or default by a Chex Entity or its
Affiliates; (ix) any Liabilities for indebtedness of borrowed money, letters
of
credit, capital leases or installment purchases; (x) any Liabilities under
any
applicable Environmental Law with respect to the time period prior to the
Closing Date; (xi) any Liability associated with or arising under a Material
Business Contract that is not an Assumed Contract, whether such Liability
arises
before or after Closing; (xii) all accounts payable; and (xiii) any other
Liabilities not expressly assumed by Game Financial in this Agreement.
The Chex
Entities and their Affiliates will discharge when due all of their respective
obligations and liabilities that are not expressly assumed by Game Financial
in
this Agreement.
4.3
Purchase
Price, Prorations, and Cash Allocation.
(a) Purchase
Price.
The
purchase price (“Purchase Price”) for the Assets shall be: (i) Fourteen Million
Dollars (US $14,000,000) in cash, subject to adjustments as provided in
Subsection
4.3(b),
and
(ii) the assumption by Game Financial of the Assumed Liabilities pursuant
to
Subsection
4.2.
(b) Prorations.
The
purchase price shall be adjusted at and as of Closing as follows: (i) it
shall
be increased to reflect the value of prepaid liabilities which are part
of the
Assets, (ii) it shall be decreased to reflect the value of accrued but
unpaid
amounts in connection with the Assumed Liabilities. These are described
on
Schedule
4.1(a)(vi).
(c) Cash
Allocation.
At
Closing, the Chex Entities shall transfer to Game Financial, free and clear
of
all Liens, all cash, including vault cash, booth cash, and cash in automated
teller machines. Game Financial and the Chex Entities shall cooperate to
calculate as precisely as possible the amount of such cash estimated to
be
transferred at Closing at least one (1) Business Day prior to Closing (the
“Estimated Cash Amount”). At Closing, Game Financial shall, in addition to the
Purchase Price, pay to Chex an amount equal to the Estimated Cash Payment
by
wire transfer of immediately available funds. Within fifteen (15) Business
Days
after the Closing Date, a mutually acceptable independent company hired
for the
purpose of determining the actual cash amount shall then calculate the
final
amount of such cash actually transferred at Closing (the “Actual Cash Amount”) .
If the Actual Cash Amount is greater than the Estimated Cash Amount, then
Game
Financial shall pay the difference to Chex, and if the Actual Cash Amount
is
less than the Estimated Cash Amount, then Chex shall pay Game Financial
the
difference. Such payments shall be made within five (5) Business Days after
the
final determination by the above-described company. Game Financial and
Chex
shall equally share the costs of hiring the above-described independent
company.
(d) Allocation
of Purchase Price.
The
Purchase Price shall be allocated by the parties within thirty (30) days
following the Closing through arm’s-length negotiation and in a manner that
properly reflects the fair market value of the Assets. The allocations
made
pursuant to this subsection
will
be
binding on all parties for all Tax purposes in connection with the purchase
and
sale of the Assets and will be
consistently reflected by each party on its respective Tax Returns.
4.4 Procedures
for Non-Transferable Assets.
If
any
property or right included in the Assets or the Assumed Liabilities is
not
assignable or transferable without the consent of a third party, and that
consent is not obtained prior to the Closing Date, this Agreement, the
Ancillary
Agreements and any related instruments of transfer shall not constitute
an
assignment or transfer, and Game Financial shall not assume any of the
Chex
Entities’ associated obligations, but the Chex Entities shall diligently use
their best efforts to obtain such consent as soon as possible after the
Closing
Date. With respect to each such property or right for which a necessary
consent
was not obtained prior to the Closing Date, the Chex Entities shall use
commercially reasonable efforts to otherwise obtain for Game Financial,
at no
additional cost to Game Financial, the benefits of such property or right
until
such consent is obtained.
5. Closing.
5.1 Time
and Place.
The
consummation of the transactions contemplated by this Agreement shall take
place
at a closing (“Closing”) at the offices of Game Financial, 11601 Roosevelt
Boulevard, St. Petersburg, Florida 33716. The parties shall use commercially
reasonable efforts to close the transactions as soon as practicable, and
in
particular shall use commercially reasonable efforts to close the transactions
by February 1, 2006. The date of the Closing shall be the “Closing Date.” For
purposes of electronic transactions processing, the parties shall mutually
agree
on designated cut-off times to be used in determining precisely when
transactions will begin to be processed for the account of Game
Financial.
5.2 Closing
Deliveries of Game Financial.
At the
Closing, upon satisfaction or waiver of the conditions set forth in Subsection
9.1,
Game
Financial shall deliver: (i) Fourteen Million Dollars (US$14,000,000) of
the
Purchase Price (“Closing Cash Payment”) by wire transfer of immediately
available funds to Chex, the instructions for which shall be provided to
Game
Financial a reasonable time prior to Closing; and (ii) each
of
the instruments, certificates and other documents set forth in Subsection
9.2.
5.3 Closing
Deliveries of the Chex Entities.
At the
Closing, upon satisfaction or waiver of the conditions set forth in Subsection
9.2,
the
Chex Entities shall deliver to Game Financial each of the instruments,
certificates, items and documents set forth in Subsection
9.1.
6. Representations
and Warranties of the Chex Entities.
The
Chex
Entities prepared
and delivered (or caused to be prepared and delivered on its behalf) the
schedules included in this Agreement that set forth any and all exceptions
or
supplemental information to the various representations, warranties and
covenants contained in Sections 6 and 8 of this Agreement (“Schedules”), and
delivered documents and materials pursuant to or in connection with this
Agreement, and any and all modifications or amendments to those documents
and
materials were delivered with the Schedules. The disclosures set forth
in the
Schedules qualify or supplement only those representations, warranties
and
covenants specifically referenced and referred to in the relevant Schedule,
and
a disclosure or supplement related to any particular representation, warranty
or
covenant shall not qualify or supplement any other representation, warranty
or
covenant unless expressly stated. To induce Game Financial to enter into
this
Agreement and to
consummate
the transactions contemplated by this Agreement, subject to the qualifications
set forth in each relevant Schedule, the Chex Entities, jointly and severally,
represent and warrant to Game Financial that each of the following is true
and
correct as of the Effective Date and
will
be true and correct as of the Closing Date:
6.1 Organization
and Share Ownership.
Chex is
a corporation duly organized, validly existing, and in good standing under
the
Laws of Minnesota. FastFunds is a corporation duly organized, validly existing,
and in good standing under the Laws of Nevada. The Chex Entities have all
requisite corporate authority to own, operate or lease the Assets as they
are
now owned, operated or leased, and to conduct the Business as presently
conducted. The Chex Entities have furnished true and complete copies of
their
respective Organizational Documents. Schedule
6.1(i)
lists
all jurisdictions in which the Chex Entities are qualified to conduct business
as foreign corporations, and no qualifications to do business other than
those
listed on Schedule
6.1(i)
were
required to operate the Business or own the Assets without material adverse
effect on the Business. The Chex Entities do not have any Subsidiaries,
and do
not, directly or indirectly, own or have the right to acquire any equity
interest in any other Person, except as described on Schedule
6.1(i).
Schedule
6.1(i)
also
lists: (i) all locations with respect to the Business or Assets where the
Chex
Entities currently own or lease real property, have an office, or place
of
business; and (ii) all trade names under which the Chex Entities and their
respective predecessors have operated, if different from their present
legal
name, at any time since October 1, 1995. Schedule
6.1(ii)
lists
all the authorized equity securities of Chex and FastFunds, and all the
issued
and outstanding equity securities of Chex and FastFunds. FastFunds owns
all the
issued and outstanding equity securities of Chex, and no other Person has
any
rights to obtain or vote the equity securities of Chex, except as set forth
on
Schedule
6.1(ii).
As of
the date of this Agreement and the record date for determining eligibility
to
vote on this Agreement and the transactions contemplated hereby Equitex
owns and
will own at least 73% of the issued and outstanding common stock of FastFunds,
and Equitex’s vote (as the majority shareholder of FastFunds) in favor of this
Agreement and the transactions contemplated hereby constitutes the requisite
FastFunds stockholder approval therefor. Only holders of FastFunds common
stock
issued and outstanding on such record date shall have or will have voting
rights
with respect to the transactions contemplated by this Agreement. Neither
FastFunds nor the Assets constitute all or substantially all the business,
operations or assets of Equitex.
6.2 Authority.
Each
Chex Entity has
all
requisite corporate power and authority to: (i) enter into and deliver
this
Agreement; (ii) perform its obligations under this Agreement and each Ancillary
Agreement; and (iii) consummate the transactions contemplated by this Agreement
and each Ancillary Agreement to which it is a party. The execution and
delivery
of this Agreement and each Ancillary Agreement by the Chex Entities, the
performance by them of their obligations under this Agreement and each
Ancillary
Agreement, and the consummation by them of the transactions contemplated
by this
Agreement and each Ancillary Agreement have been duly authorized by all
necessary corporate and stockholder action. This Agreement has been,
and
the
Ancillary Agreements have been or shall be (as the case may be),
duly
executed and delivered by the Chex Entities. This Agreement constitutes,
and
each of the Ancillary Agreements to which a Chex Entity is a party when
so
executed and delivered, will constitute a legal, valid and binding obligation
of
such Chex Entity, enforceable against it in accordance with its
terms.
6.3 Required
Consents.
Except
as specified on Schedule
6.3
(the
“Required Consents”), no consent, order, authorization, approval, declaration or
filing, including, without limitation, any consent, approval or authorization
of
or declaration or filing with any Governmental Authority or other Person
or any
party to an Assumed Contract or other Contract that will be an Assumed
Liability, is required on the part of any Chex Entity for or in connection
with
the execution, delivery or performance of this Agreement or the conduct
of the
Business by Game Financial after the Closing, or to prevent a default under
any
Contract relating to the Business to which a Chex Entity is a party. The
Chex
Entities have no reason to believe that any of the Required Consents will
not be
obtained. Subject to obtaining the Required Consents, the execution, delivery
and performance of this Agreement and each Ancillary Agreements by the
Chex
Entities will not result in any violation of, be in conflict with, or
constitute a default (with or without the giving of notice and/or passage
of
time) under, any Organizational Document, License, Law, Contract, or
Governmental Order to which a Chex Entity is a party or by which a Chex
Entity
is bound; nor will these actions result in: (i) the creation or acceleration
of
any Lien on any of the Assets of Chex; (ii) the acceleration or creation
of any
material obligation of Chex; or (iii) the forfeiture of any material right
or
privilege of Chex or the Business. Neither this Agreement nor the transactions
contemplated hereby give rise to dissenters, appraisal or similar rights
for the
shareholders of FastFunds or Equitex. The transactions contemplated hereunder
will give rise to dissenters’ rights in favor of FastFunds as the sole
shareholder of Chex, which FastFunds agrees not to assert and hereby irrevocably
waives with respect to this Agreement and the transactions contemplated
hereby.
Without limiting the generality of the foregoing, the Chex Entities have
obtained all necessary consents and approvals for entering into this Agreement
and the Ancillary Agreements and consummating the transactions contemplated
herein and therein, from Equitex, Pandora and Whitebox.
6.4 Equipment
and Tangible Property.
Schedule
6.4
contains
a list of all equipment and tangible personal property (except for
non-capitalized leased equipment) of the Chex Entities used in the Business,
other than any equipment and tangible personalty comprising Excluded Assets.
All
such property is adequate and usable for the purpose for which it is currently
used, is in good operating condition and repair, and has been properly
maintained. All
lessors of the Assets have performed and satisfied their respective duties
and
obligations under the leases governing the use of those Assets, and no
Chex
Entity has brought or threatened any Action against any relevant lessor
for
failure to perform and satisfy its duties and obligations under any such
lease.
6.5 Intellectual
Property and Proprietary Rights.
Schedule
4.1(a)(v)
contains
a complete and accurate list of all Intellectual Property and Proprietary
Rights
used in the operation of the Business, and all such Intellectual Property
and
Proprietary Rights are included in the Assets. There is no reasonably
foreseeable or threatened loss or expiration of any Intellectual Property
or
Proprietary Rights included in the Assets. The Chex Entities have taken
commercially reasonable and appropriate actions to maintain and protect
such
Intellectual Property and Proprietary Rights. The Chex Entities have good
and
marketable title to, or valid and continuing licenses to use, Intellectual
Property and Proprietary Rights and
other
intangible assets used in the operation of the Business free and clear
of all
Liens. As
of the
Closing Date, the Chex Entities shall have assigned all ownership in the
Intellectual Property and Proprietary Rights listed in Schedule
4.1(a)(v)
to Game
Financial, and such Intellectual Property and Proprietary Rights are not
and
will not be subject to any Liens. That Intellectual Property and those
Proprietary Rights include all of the Intellectual Property and Proprietary
Rights necessary and/or used to conduct the Business as currently conducted
and
proposed to be conducted. To the Knowledge of the
Chex
Entities, the Business and the Assets do not infringe upon the Proprietary
Rights or other rights or interests of any Person. There are no present
or
threatened Actions relating to infringement of Proprietary Rights by any
Person.
Except as set forth in Schedule
6.5,
there
are no pending or threatened proceedings or litigation or other adverse
claims
by any Person against a Chex Entity relating to the ownership or use of
any
Proprietary Rights used in the operation of the Business or the Intellectual
Property listed in Schedule
4.1(a)(v).
Except
as listed on Schedule
6.5,
to the
Knowledge of the Chex Entities, no Person has or is currently infringing
or
diluting any of the rights of the Chex Entities in or to that Intellectual
Property and Proprietary Rights. Except as set forth on Schedule
6.5,
no such
Intellectual Property or Proprietary Rights have been abandoned, and none
are
subject to any outstanding Governmental Order, written restriction or agreement
restricting their scope of use. Except as indicated on Schedule
6.5,
each
of the registered Chex Marks, Intellectual Property and Proprietary Rights
set
forth in Schedule
4.1(a)(v)
were
duly registered, and those registrations remain in full force and effect.
Except
as set forth on Schedule
6.5,
to the
Knowledge of the Chex Entities, there are no material infringing or diluting
uses of any of the Chex Marks, Intellectual Property or Proprietary Rights
included in the Assets. Except as set forth on Schedule
6.5,
no Chex
Entity has granted any license (other than such licenses and permissions
for
one-time or limited use granted in the ordinary course of business) to
any
Person to use any of the Intellectual Property or Proprietary Rights listed
in
Schedule
4.1(a)(v).
That
Intellectual Property and those Proprietary Rights are not subject to any
transfer, assignment, site, equipment, or other operational limitation.
All
assigned Intellectual Property and Proprietary Rights include, to the extent
applicable, the source code, system documentation, statements of principles
of
operation and schematics, as well as any pertinent commentary, explanation,
program (including compilers), techniques, tools, and higher level or
“proprietary” language used for development, maintenance, implementation and/or
use, so that a trained computer programmer could develop, maintain, support,
compile and use all releases or separate versions. There are no agreements
or
arrangements in effect with respect to the marketing, distribution, licensing
or
promotion of the assigned Intellectual Property and Proprietary Rights
by any
Person other than as disclosed in Schedule
6.6(a)(i).
All
employees, agents, consultants or contractors who contributed to or participated
in the creation or development of any assigned Intellectual Property and
Proprietary Rights: (i) are a party to a “work-for-hire” agreement under which a
Chex Entity or its predecessor in interest is deemed to be the original
owner/author of all property rights therein; or (ii) have executed an assignment
or an agreement to assign to a Chex Entity or its predecessor in interest
all
right, title and interest in such material. All of the foregoing representations
and warranties in this Subsection
6.5
are
subject to the qualification contained in the last sentence of Subsection
6.26
below.
6.6 Material
Business Contracts and Assumed Contracts.
(a) Listing.
Schedule
6.6(a)
contains
a complete and accurate list of the following Contracts that relate to
the
Business (each, a “Material Business Contract” and, collectively, the “Material
Business Contracts”): (i) Contracts with respect to which there is any Liability
that equals or exceeds ten thousand dollars (US$10,000.00), contingent
or
otherwise, or which may extend for a term of greater than one (1) year
after the
Closing Date; (ii) Contracts with any Person that purport to restrict the
use of
the Assets or the Business’ information or restrict the use of the Software in
any location, including any covenant not to compete or any Contracts imposing
exclusive dealing obligations; (iii) employment, collective bargaining,
severance, stay bonuses, retention, consulting, employee benefit and similar
plans and agreements; (iv) agreements under which a Chex Entity is obligated
to
indemnify or hold harmless, or entitled to indemnification from, any other
Person, or agreements under which a Chex
Entity
is
obligated to pay liquidated damages; (v) Contracts between a Chex Entity
and any
stockholder, director, officer or employee or other Affiliate; (vi) Contracts
under which the amount payable by a Chex Entity is dependent on the revenues
or
income or similar measure of the Business, or in which a Chex Entity is
obligated to pay royalties, commissions or similar payments to any person
or
entity; (vii) pledges, security agreements, sale/leaseback arrangements
and
equipment leases; (viii) License and other similar arrangements where a
Chex
Entity is either licensee or licensor with respect to any Intellectual
Property
or Proprietary Rights of the Business; (ix) Contracts to which a Chex Entity
is
a party relating to the borrowing of money, the capital lease or purchase
on an
installment basis of any Asset, or the guarantee of any of the foregoing,
if any
of the foregoing has or could create a Lien on the Assets; (x) joint venture,
strategic alliance, partnership or other similar agreements; (xi) barter,
currency, interest rate swap, hedge or broker Contracts; (xii) any Contracts
relating to the lease, license or rental of any data, information or lists,
whether a Chex Entity is the provider or consumer of such information;
(xiii)
all
material agreements with suppliers, vendors, manufacturers, contractors
and
other third parties in connection with the Business; (xiv) any Contract
that
restricts the ability of persons to compete with the Business or with a
Chex
Entity, including any Contract granting exclusive rights to a Chex Entity;
and
(xv)
to the extent not already specifically listed, any other Contract or agreement
material to the Business. Schedule
6.6(a)
includes, with respect to each Material Business Contract, the names of
the
parties, the date thereof, and the title of the Agreement. The Chex Entities
have furnished Game Financial with copies of all Material Business Contracts
(or
written summaries, in the case of Material Business Contracts that are
oral),
including all amendments, modifications or supplemental arrangements, and
any
further information that Game Financial has reasonably requested in connection
therewith. Notwithstanding anything else to the contrary in this Agreement
or
the Schedules, there are no sales agency, distributorship, agency, joint
marketing or similar agreements pursuant to which a Person has the right
to
receive, from and after Closing, royalties, retention payments, commissions
or
similar payments with respect to the Assets, Assumed Contracts or the sales
or
income generated therefrom (collectively, “Ongoing Commissions”), except as
disclosed on Schedule
6.6(a), paragraph (xvi).
The
parties and third party beneficiaries to the Assumed Contracts are only
Chex
and/or FastFunds and the end-user Person purchasing services from Chex
or
FastFunds. No sales representative, agent, distributor or similar Person
is a
party to or third party beneficiary of any of the Assumed Contracts (except
that
First American Financial Solutions is a party to cash access service agreements
with Hawks Prairie Casino and Northstar Casino).
(b) Except
as
set forth in Schedule
6.6(b):
(i)
each Assumed Contract represents a valid, binding and enforceable obligation
of
the applicable Chex Entity in accordance with its respective terms and
represents a valid, binding and enforceable obligation of each of the parties
thereto; (ii) there have been no amendments, modifications or supplemental
arrangements to or with respect to any Assumed Contract; (iii) there is
no event
that has occurred or existing condition (including the execution and delivery
of
this Agreement and the consummation of the transactions contemplated by
this
Agreement) that, upon the happening of an event and/or the passage of time,
would constitute a material default or breach under any Assumed Contract
by the
Chex Entity that is a party, or would cause the acceleration of any obligation
of that Chex Entity, give rise to any right of termination or cancellation
by
any party other than such Chex Entity, cause the creation of any Liens
on
any of the Assets, or give rise to a right of indemnification by any party
other
than such Chex Entity; (iv) to the Knowledge of the Chex Entities, none
of the
Material Business Contracts, individually or in the aggregate, constitutes
an
unlawful restraint of trade under any applicable Law; and (v) no Chex Entity
is
aware of: (A) any
supplier
or client of the Business that intends to discontinue or substantially
diminish
or change its
relationship
with the Business or the terms of its relationship with the Business, (B)
any
supplier of the Business that intends to increase prices or charges for
goods or
services presently supplied, or (C) any supplier to the Business that is
likely
to become unable to continue its relationship with the Business, or supply
the
goods or services that it currently supplies to the Business, without
significant change in the terms and conditions of its arrangement with
the
Business. No Chex Entity has reason to believe that any party to an Assumed
Contract will not timely fulfill all of its obligations
thereunder in all material respects.
6.7 Business
Licenses.
The
Chex Entities own or possesses all right, title and interest in and to
all
Business Licenses that are necessary
as of the Effective Date for the ownership, maintenance and operation of
the
Business and Assets, and neither the Chex Entities nor their predecessors
have
been since December 31, 1998, in violation of such Business
Licenses. Schedule
6.7
contains
a list of all Business
Licenses necessary for the ownership, maintenance and operation of the
Business
and Assets, with the following identifying information: the Governmental
Authority issuing such Business License, the Business License number, the
dates
of issuance and their duration, and the type of Business License. All such
Business Licenses are in full
force
and effect, and no Chex Entity is in material violation of the terms of
any such
Business License. Except as indicated on Schedule
6.7,
no
loss or expiration
of any such Business License is pending or threatened.
6.8 Business
Employees.
(a) Schedule
6.8
lists
all employees of a Chex Entity who, as of the Effective Date, have employment
duties primarily related to the Business, including (and designating as
such)
any employee that is an inactive employee on paid or unpaid leave of absence,
short-term disability or long-term disability, and indicating the date
and
location of employment, current title, compensation, and other benefits
accrued
as of a recent date. No employee of a Chex Entity is obligated under any
Contract, or subject to any Governmental Order, that would interfere with
that
employee's duties to a Chex Entity or to Game Financial (if such employee
is a
Transferred Employee) or
that
would conflict or interfere with the Business.
(b) Each
employee set forth in Schedule 6.8 that remains employed by a Chex Entity
immediately prior to the Closing (whether actively or inactively), and
each
additional employee that is hired to work primarily in the Business following
the Effective Date, but prior to Closing, who remains employed by a Chex
Entity
immediately prior to the Closing (whether actively or inactively), is referred
to herein individually as a “Business Employee” and, collectively, as the
“Business Employees.” No Business Employees are or have been covered by a union
or collective bargaining agreement with respect to their employment by
a Chex
Entity or are represented by a labor organization. There are no existing,
pending or threatened strikes, work stoppages
or lockouts related to the Business Employees. There has been no attempt
by any
union or other labor organization to organize employees of any Chex Entity
at
any time in the past five (5) years. There are no union organizational
campaigns
in progress with respect to the Business Employees or any
questions concerning representation with respect to such Business Employees.
There are no unfair labor practice charges or complaints pending or threatened
against any Chex Entity with any Governmental Authority. The Chex Entities
have
complied with all applicable Laws
regarding wages, hours, health and safety, payment of national insurance,
withholding and other taxes, maintenance of worker’s compensation insurance,
labor
and
employment relationships, employment discrimination, and other applicable
employment and employment related practices.
(c) The
transactions contemplated by this Agreement and the Ancillary Agreements
do not
trigger or violate the Worker Adjustment and Retraining Notification Act
or any
similar state or local requirement.
6.9
Employee
Compensation and Benefits Plans
(a) Schedule
6.9(a)
contains
a true
and
complete list of each Benefit Plan. Except as set forth on Schedule
6.9(a),
there
are no benefits to which any Business Employee is entitled and there are
no
benefits or Benefit Plans to which a Chex Entity has any obligation. There
are
no benefits or Benefit Plans for which Game Financial will have any obligation
after the Closing Date. The Chex Entities have
delivered to Game Financial a copy of each Benefit Plan, a summary plan
description, and other written plan material (or if unwritten, a reasonably
detailed description of such Benefit Plan).
(b) Except
as
set forth in Schedule
6.9(b),
the
consummation of the transactions contemplated by this Agreement will not,
either
alone or in combination with another event: (i) entitle any Business Employee
any bonus, severance pay, unemployment compensation or any other payment;
(ii)
accelerate the time for payment or vesting under any Benefit Plan; (iii)
accelerate the time of payment or vesting, or increase the amount of any
compensation or benefits due to any Business Employee; (iv) increase or
secure
(by way of trust or other vehicle) any benefits payable under any Benefit
Plan.
The Chex Entities shall be solely liable and responsible for the payment
of any
bonus, severance pay, unemployment compensation or any other payments listed
on
Schedule
6.9(b).
(c) With
respect to each Benefit Plan: (i) the Benefit Plan has been operated, managed,
administered and enforced in accordance with its governing documents and
all
applicable Laws, regulations and rulings; (ii) no breach of fiduciary duty
has
occurred with respect to which a Chex Entity or any Benefit Plan may be
liable
or otherwise damaged in any material respect; (iii) no material disputes
nor any
audits or investigations by any Governmental Authority are pending or are
threatened,
and no such completed audit, if any, has resulted in the imposition of
any Tax,
interest or penalty;
(iv) all
contributions, premiums, and other payment obligations have been accrued
on the
combined Financial Information of the Chex Entities in accordance with
GAAP,
and, to the extent due, have been made on a timely basis, in
all
material respects; (v) each Benefit Plan that purports to provide benefits
that
qualify for tax-favored treatment under applicable Law satisfies the
requirements of such Law; (vi) no Action (other than for routine claims
for
benefits) are pending or threatened against any of the Benefit Plans or
any
fiduciary, administrator, sponsor (in their capacities as such), or other
party-in-interest thereof; (vii) the Chex Entities have
expressly reserved in itself the right to amend, modify or terminate such
Benefit Plan, or any portion of it, at any time without Liability to the
relevant Chex Entity; and (viii) no such Benefit Plan requires a Chex Entity
to
continue to employ any Business Employee or director.
6.10 Financial
Information.
The
income statements and balance sheets,
together with any related notes and schedules, for
each of
the years ended December 31, 2003 and December 31, 2004, and the statements
of
income and cash
flow, together with any related notes and schedules, for the periods then
ended
and the auditor’s report thereon, for FastFunds as
reviewed by Gelfond Hochstadt Pangburn, P.C. (including related Chex financial
statements) (collectively, the “Year-End Statements”), and unaudited statements
of income for the nine (9) month period ending September 30, 2005 (“Stub
Statements”) and an unaudited balance sheet for the Business as of September 30,
2005 (“Balance Sheet” and, collectively with all of the foregoing financial
information, the “Financial Information”) are publicly available as (i) exhibits
to that certain current report on Form 8-K filed by FastFunds with the
SEC on
September 14, 2004, (ii) contained in FastFunds’ annual report on Form 10-K
filed with the SEC on April 15, 2005, and (iii) contained in FastFunds’
quarterly report on Form 10-Q filed with the SEC on November 14, 2005.
The
Financial Information (as defined herein) and other financial information
provided to Game Financial and its Affiliates have been prepared from books
and
records maintained consistent with past practice and in accordance with
GAAP.
Each of the Year-End Income Statements and the Stub Statements, and the
other
Financial Information (as defined herein) and other financial information
provided to Game Financial or its Affiliates are complete and accurate
in all
material respects and fairly represent the financial condition of the Business
as of the respective dates thereof. To the Knowledge of the Chex Entities,
they
have disclosed to Game Financial all material facts relating to the preparation
of the Financial Information (as defined herein) and other financial information
provided to Game Financial or its Affiliates.
6.11 Real
Property.
The
Assets do not include any real property or any interest in real property,
including leases, subleases, easements or licenses.
6.12 Litigation;
Governmental Orders.
Except
as set forth in Schedule
6.12,
there
are no, and for four (4) years prior to the Effective Date there have been
no,
pending or threatened Actions (or any basis therefor) by any Person or
Governmental Authority against any Chex Entity that relates to, or could
affect,
the Business, revenues or the Assets, or against any director, officer
or
shareholder of a Chex Entity that relates to the foregoing, nor, to the
Knowledge of the Chex Entities, is there any basis for any of the foregoing.
No
Chex Entity is subject to or bound by any Governmental Order relating to
the
Business or the Assets. No director, officer or shareholder of a Chex Entity
is
subject to or bound by any Governmental Order that relates to the affairs
of the
Business. To the Knowledge of the Chex Entities, there are no facts or
circumstances that may result in the institution of an Action involving
or
affecting the Assets, the Business or the transactions contemplated by
this
Agreement or the Ancillary Agreements. Except as disclosed on Schedule
6.12,
there
is no Action by a Chex Entity pending or threatened against others. The
litigation involving Lisa Maulson and the Howards does not relate to any
Assumed
Contracts.
6.13 Compliance
with Law.
The
Chex Entities are
not in
default under or in violation of: (i) their Organizational Documents; or
(ii)
any Governmental Order or Law. The Business
has been conducted in material compliance with all Laws and Governmental
Orders
applicable to it. Except as set forth in Schedule
6.13,
the
Chex Entities are in compliance with, and have not received any claim or
notice
that they are not in compliance with, their respective
Organizational
Documents
and any Law or Governmental Order applicable to them. The Chex Entities
have
provided
all legally required and reasonably appropriate training to their employees
and
agents regarding compliance with applicable Governmental
Orders
and Laws.
6.14 Environmental
Matters.
Except
as disclosed in Schedule
6.14:
(i) the
ownership and use of the Assets and the conduct of the Business are in
compliance in all material respects with all Environmental Laws; (ii) the
Chex
Entities hold and are in compliance with all Licenses required under
Environmental Laws applicable to the conduct of the Business as presently
conducted; (iii) the Chex Entities have not received notice of, nor does
any
Chex Entity have any Knowledge of a basis for, any Action by any Person
or
Governmental Authority alleging a violation of or Liability under any
Environmental Law; (iv) to their Knowledge, there has been no spilling,
leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing of a Hazardous Substance at any real property
previously owned, leased or operated by a Chex Entity that violates or
is
reasonably likely to lead to any Liability arising under an Environmental
Law;
and (v) the Chex Entities have not used any Hazardous Substances in connection
with the Business.
6.15 Insurance.
The
Chex Entities maintain insurance on the Assets and the Business, covering
such
risks, in such amounts, with such terms and with such insurers as are reasonable
in light of the Business and consistent with industry practice (“Business
Insurance Policies”). Schedule
6.15
contains
a list and brief description of all Business Insurance Policies or binders
of
insurance that provide coverage for any of the Assets or other assets used
in
connection with the Business (in each case specifying the insurer, the
amount of
coverage, and the type of insurance). All premiums due under the Business
Insurance Policies have been paid and all of the Business Insurance Policies
are
in full force and effect. All liability insurance policies are on an
“occurrence” basis. The Business Insurance Policies are in amounts adequate to
cover losses on physical assets, and in amounts sufficient to avoid the
operation of any coinsurance provision. There is no default with respect
to any
material provision contained in any such Business Insurance Policy, and
no
notice of cancellation or non-renewal of, or proposed material increase
in the
premiums payable for coverage under, any such Business Insurance Policy
has been
received. There are no outstanding surety or performance bonds with respect
to
the Business.
6.16 Transactions
with Affiliates.
Except
as disclosed on the periodic reports of FastFunds filed with the Securities
and
Exchange Commission on Forms 10-K, 10-Q and 8-K, or as set forth in Schedule
6.16,
no
shareholder, officer, director or employee of a Chex Entity or any of their
Affiliates, or any immediate family member of any of the foregoing: (a)
has
borrowed money from, or loaned money to, the Business that remains outstanding;
(b) has any ownership interest in or Lien on any of the Assets; (c) provides
any
services to the Business; (d) is a party to any Contract that relates to
the
Business or the Assets; (e) competes with the Business; or (f) provides
services
similar to that provided by the Business anywhere in the world.
6.17 Taxes.
(a) All
Tax
Returns required to be filed by or on behalf of the Chex Entities have
been duly
filed on a timely basis. The Chex Entities shall prepare and file Tax Returns
for all periods ending on or prior to the Closing Date. All Tax Returns
are
true, complete, correct
and
show
the proper amount due. The Chex Entities shall permit Game Financial to
review
and comment on any Tax Returns to be filed after the Effective Date that
relate
in any way to income derived from the operation of the Business prior to
their
filing. The Chex Entities shall pay any Taxes owed with respect to such
periods.
All Taxes owed by a Chex Entity for a taxable period or partial taxable
period
ending on or before the Closing Date have been timely paid or will be timely
paid by the applicable Chex Entity prior to the Closing. Game Financial
has been
supplied with true and complete copies of each Tax Return of the Chex Entities
based on income received (in who or in part) from the Business that were
filed
for the last three (3) taxable years. The Chex Entities: (i) have never
been
audited or received notice of initiation thereof by any Governmental Authority
for which the statute of limitations for assessment of Taxes remains open;
(ii)
have never extended any applicable statute of limitations regarding Taxes
for
which the statute of limitations for assessment of Taxes remains open;
(iii) are
not liable, contractually or otherwise, for the Taxes of any other Person
(other
than withholding Taxes arising in the ordinary course of business); (iv)
are not
a party to any allocation or sharing agreement with respect to Taxes, and
(viii)
have never participated in the filing of any consolidated, combined or
unitary
Tax Return.
(b) No
property used by a Chex Entity in the operation of the Business is tax-exempt.
None of the Assets secures a debt where the interest is tax-free.
(c) The
Chex
Entities are not a party to any joint venture, partnership or other arrangement
or contract that could be treated as a partnership for income tax
purposes.
(d) There
are
no security interests in any of the Assets that relate to a failure (or
alleged
failure) to pay any Tax.
6.18 Absence
of Changes or Events.
Except
as set forth in Schedule
6.18,
the
Chex Entities have operated the Business only in the usual and ordinary
course
since December 31, 2004, and there has not been: (i) any event, circumstance
or
condition that has had or that would reasonably be expected to cause a
Material
Adverse Change before or after the Closing; (ii) any
deviation from operating the Business in the ordinary course of business
consistent with prior practices; (iii) any damage,
destruction or casualty loss, whether covered by insurance or not, that
individually or in the aggregate exceeds twenty-five thousand dollars
(US$25,000.00); (iv) any acquisition or sale, transfer or other disposition
of
assets other than in the ordinary course of business consistent with past
practice or any Lien placed upon any assets of a Chex Entity; (v) any increase
in compensation of any Business Employees; and (vi) except as expressly
contemplated by this Agreement, any entry into any agreement, commitment
or
transaction (including, without limitation, any borrowing or capital financing)
that is material to the Business or operations of the Assets, except agreements,
commitments or transactions in the ordinary course of business consistent
with
past practices. Except as disclosed in Schedule
6.18,
since
December 31, 2004, the Chex Entities have not taken any action that would
have
been prohibited by Subsection
8.1
if this
Agreement had been in effect.
6.19 Sufficiency
of Assets.
Except
as listed on Exhibit
6.19,
the
Assets include all assets currently used in or necessary for the conduct
of the
Business and are adequate to conduct the operations of the Business as
currently
conducted and as proposed to be conducted. The
Assumed
Contracts include all Contracts currently used in or necessary for the
conduct
of the Business. Subject to the qualification in Subsection
6.26,
the
Chex Entities have good title to or a valid leasehold or license interest
in
each item of personal property used by it in the Business and included
in the
Assets (including good and marketable title to all assets reflected on
the
Balance Sheet, other than those disposed of during the last year in the
ordinary
course of business consistent with past practice), free and clear of any
Lien
other than Permitted Liens. All material operating assets included in the
Assets
are adequate and usable for the purpose for which they are currently used,
are
in good operating condition, and have been properly maintained. The delivery
to
Game Financial of the instruments of transfer of ownership contemplated
by this
Agreement will, upon such delivery, vest good and marketable title to or
a valid
Leasehold or license interest in the Assets in Game Financial, free and
clear of
any Liens, other than Permitted Liens. Without limiting the foregoing,
and
except as disclosed on Schedule
6.19,
no
Person other than a Chex Entity owns or has an ownership interest of any
kind in
the Assets (including the Assumed Contracts). In addition, the Assets are
free
in all material respects from any defects (either patent or latent). The
current
ownership, use and/or occupancy of the Assets does not violate any instrument,
agreement, restriction or law affecting the Assets.
6.20 Brokers.
Except
as set forth on Schedule
6.20,
no
finder, broker, agent, financial advisor or other intermediary has acted
on
behalf of a Chex Entity or a Chex Affiliate in connection with the negotiation
or consummation of this Agreement or the transactions contemplated herein
and no
such Person is entitled to any fee, payment, commission or other consideration
in connection therewith.
6.21 Prepaids
by Chex.
Schedule
6.21
is a
complete and accurate list of all prepaids included in the Assets, and
such
prepaids are valid and enforceable claims, subject to no set-off or counterclaim
and fully collectible net of any reserves without resort to litigation.
All such
prepaids arose out of bona fide transactions in the ordinary course of
business.
6.22 Prepaid
Service Fees to Chex.
Schedule
6.22
is a
list, as of the Closing Date, of the outstanding prepaid service fees paid
to
any Chex Entity relating to the Business, segregated by the appropriate
Chex
Entity and the month and year for which the related service will be fulfilled.
None of these prepaid fees represents more than three (3) months of
prepayment.
6.23 Absence
of Undisclosed Liabilities.
The
Chex Entities have no Liabilities relating to the Business other than:
(a) the
Excluded Liabilities; (b) the Liabilities set forth on the Balance Sheet;
(c)
obligations of future performance under the Material Business Contracts
and
Business Licenses; and (d) Liabilities that have arisen since October 1,
2005 in
the ordinary course of business or otherwise in accordance with this Agreement,
including Subsection
8.1.
6.24 Books
and Records.
The
books, records and accounts of the Business: (a) have been maintained in
accordance with good business practices on a basis consistent with prior
years;
(b) are stated in reasonable detail and accurately and fairly reflect the
transactions related to the Business; and (c) accurately and fairly reflect
the
basis for the Financial Information. The Chex Entities have 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; and (ii) transactions are
recorded as necessary
(A)
to
permit preparation of Financial Information in conformity with GAAP and
(B) to
maintain accountability for Assets.
6.25 Projections.
All
projections provided to Game Financial or its Affiliates were prepared
in good
faith and were based on assumptions believed to be reasonable. There are
no
facts or circumstances currently known that would make such projections
impossible to achieve in all material respects.
6.26 Software.
The
Chex Entities have good and marketable title to the Software, as well as
all
portions thereof and all data and information comprising such Software.
As of
the Closing, the Chex Entities will assign to Game Financial sole and exclusive
ownership of the Software and all associated Proprietary Rights, free of
any
Liens. The Software does not infringe upon the Proprietary Rights or other
rights or interests of any Person, and there are no present or threatened
infringement Actions relating to the Software by any Person. No Person
is
entitled to royalties or any other payments with respect to the Software.
Except
as set forth in Schedule
6.6(a),
no Chex
Entity has granted a license with respect to the Software. Notwithstanding
the
foregoing or any other provision of this Agreement (but subject to Section
10
(Indemnification)), the Chex Entities make no representations and warranties
of
intellectual property non-infringement with respect to the 3 in 1 Software
and
United States Letter Patent No. 6,081,792. The 3 in 1 Software is loaded,
and
immediately prior to Closing will be loaded, only on the ATM’s described on
Schedule
6.26.
For
avoidance of doubt, it is the intention of the parties that the Chex Entities
are solely responsible for, and that Game Financial bears and assumes no
responsibility for, any claims or Liabilities related to or arising out
of the
use, license, ownership or operation of the 3 in 1 Software prior to
Closing.
6.27 Disclosure.
No
Ancillary Agreement, Schedule (including the Financial Information as defined
in
Section 6.10 above and all other financial information provided to Game
Financial and its Affiliates) or any certificate delivered by or on behalf
of
any Chex Entity in connection with this Agreement or the Closing of the
transactions contemplated herein contains any untrue statement of a material
fact or omits any material fact necessary in order to make the statements
contained herein and therein not misleading. To the Knowledge of the Chex
Entities, there is no fact that materially and adversely affects the Business,
Assets, properties, operations, prospects, condition (financial or otherwise),
results of operations or Liabilities of the Business that has not been
set forth
or disclosed in this Agreement or in such relevant certificates. The Chex
Entities have delivered or made available true and complete copies of each
material document (to the extent such documents exist) requested by Game
Financial in writing prior to the date of this Agreement.
6.28 No
Agreement in Anticipation of Sale.
Except
as set forth on Schedule
6.28,
the
Chex Entities have not, directly or indirectly, taken any material action
or
entered into any agreements in anticipation of this Agreement.
6.29 Absence
of Certain Business Practices.
To the
extent prohibited by applicable Law, neither the Chex Entities nor any
of their
respective officers, directors, employees, agents or Affiliates, nor any
other
Person acting on their behalf has, directly or indirectly, within the past
five
(5) years given or agreed to give any gift or similar benefit to any
Governmental Authority or other Person that is or may be in a position
to help
or hinder the Business (or to
assist
any of them in connection with any actual or proposed transaction) that
might
subject Game Financial or any of its Affiliates, or any of their respective
directors, officers, employees or agents, to any damage or penalty in any
civil,
criminal or governmental action.
6.30 VISA,
MasterCard and Payment Network Compliance.
The current processing and other systems related to the Business comply
with all
applicable VISA, MasterCard and other financial payment network rules and
regulations.
6.31 Government
Reports.
Prior
to the Effective Date the Chex Entities delivered or made available to
Game
Financial, true, correct and complete copies of, all Tax Returns listed
on
Schedule
6.31,
and all
material reports relating to any Benefit Plan, finance and monetary
transactions, employees and employment conditions, compliance with or violation
of Law, and other matters material to the Business, to the extent that
they
relate to the Business, filed with any Governmental Authority or issued
by any
Governmental Authority to or in respect of, the Business during the past
five
(5) years.
6.32 Voting
Agreements and Guaranty Agreement.
The
Voting Agreements and Guaranty Agreement have been properly approved, executed
and delivered, in accordance with applicable Law, Contracts, and Organization
Documents and are enforceable in accordance with their terms.
7. Representations
and Warranties of Game Financial.
Game
Financial represents and warrants to the Chex Entities that each of the
following is true and correct, and will be true and correct as of the Closing
Date:
7.1 Organization.
Game
Financial is a corporation duly organized, validly existing and in good
standing
under the Laws of the State of Minnesota, USA.
7.2 Authority.
Game
Financial has all requisite corporate power and authority to: (i) enter
into and
deliver this Agreement and the Ancillary Agreements to which it is a party;
(ii)
perform its obligations under this Agreement and the Ancillary Agreements;
and
(iii) consummate the transactions contemplated by this Agreement and the
Ancillary Agreements to which it is a party. The execution and delivery
by Game
Financial of this Agreement and the Ancillary Agreements to which it is
a party,
the performance by Game Financial of its obligations under this Agreement
and
the Ancillary Agreements, and the consummation by Game Financial of the
transactions contemplated by this Agreement and the Ancillary Agreements
have
been duly authorized by all necessary corporate action. This Agreement
has been,
and the Ancillary Agreements to which Game Financial is a party shall be
as of
Closing , duly executed and delivered by Game Financial. This Agreement
constitutes, and each of the Ancillary Agreements to which Game Financial
is a
party when so executed and delivered will constitute, a legal, valid and
binding
obligation of Game Financial, enforceable against Game Financial in accordance
with its terms.
7.3 Brokers.
No
finder, broker, agent, financial advisor or other intermediary has acted
on
behalf of Game Financial or its Affiliates in connection with the negotiation
or
consummation of this Agreement or the transactions contemplated by this
Agreement and no
such
Person is entitled to any fee, payment, commission or other similar
consideration in connection therewith as a result of any arrangement made
by
Game Financial.
8. Covenants
and Agreements.
8.1 Conduct
of Business.
(a) Required
Conduct.
At all
times prior to the Closing, the Chex Entities shall operate the Business
in the
ordinary course and consistent with past practices. Without limiting the
foregoing, the Chex Entities shall: (i) maintain their corporate existence;
(ii)
preserve the organization of the Business intact; (iii) use their ordinary
efforts to preserve intact the goodwill of the Business; (iv) retain all
related
Business Licenses; (v) preserve the existing contracts and goodwill of
the
customers, suppliers, personnel and others having business relations with
the
Business; (vi) protect and maintain the
Intellectual Property and Proprietary Rights of
the
Business; (vii) maintain the books, accounts and records of the Business
in the
usual, regular and ordinary manner; (viii) pay and discharge when due (including
extensions) all Taxes, assessments and governmental charges imposed upon
any of
the Assets or the Business, or upon the income or profit therefrom (other
than
those contested in good faith by appropriate proceedings); (ix) comply
with all
Material Business Contracts and any other obligations under Contracts included
as an Assumed Liability; (x) comply with applicable Law including all Laws
that
apply to Transferred Employees; (xi) cause the Transferred Employees to
fully
vest in their respective Benefit Plans or accounts with the Chex Entities
on the
Closing Date; and (xii) pay all trade payables (other than those contested
in
good faith by appropriate proceedings) consistent with past
practice.
(b) Prohibited
Conduct.
Without
limiting the generality of the foregoing, prior to the Closing the Chex
Entities
shall not: (i) except for trade payable and other debts incurred in the
ordinary
course of business, create, incur or assume any indebtedness for borrowed
money,
make any loans or advances, assume, guarantee or endorse or otherwise become
responsible for the obligation of any other Person that could or would
constitute an Assumed Liability, or subject any of the Assets to any Lien
other
than Permitted Liens; (ii) increase the compensation, benefits or severance
arrangement of the Business Employees, or pay or agree to pay any bonus
or
similar payment, except for such increases in compensation or payments
made in
the ordinary course of business consistent with past practice; (iii) except
as
permitted by Subsection
11.3,
sell,
transfer, or otherwise dispose of, or agree to sell, transfer or otherwise
dispose of, any Assets, other than sales, transfers or disposals of, or
entry
into agreements to sell, transfer or otherwise dispose of, inventory in
the
ordinary course of business consistent with past practice; (iv) enter into
any
material agreement that would constitute an Assumed Liability, that may
place a
material limitation on the method of conducting or scope of the Business
or
require a Chex Entity to indemnify any other Person, other than agreements
made
in the ordinary course of business consistent with past practice and that
are
either contemplated in the budget provided to Game Financial or do not
(when
combined with all other agreements) create an aggregate obligation in excess
of
twenty-five thousand dollars (US$25,000.00); (v) amend or terminate any
Material
Business Contract; (vi) accept prepaid subscriptions or other advance payments
for Business’ services, or otherwise modify accounting and business policies
with respect thereto, other than in the ordinary course of
business
consistent
with past practice; (vii) make any capital expenditures with respect to
the
Assets; (viii) do (or fail to do) any other act that would cause any
representation or warranty in this Agreement to be or become untrue in
any
material respect or intentionally omit to take any action necessary to
prevent
any representation or warranty from being untrue in any material respect
at such
time; (ix) take any other action that would materially and adversely affect
or
detract from the value of the Assets or the Business or would reasonably
be
expected to delay
the
Closing; (x) disclose
to any Person, other than Game Financial, any proprietary or confidential
information related to the Business in connection with a possible acquisition
(directly or indirectly, through merger, stock purchase or otherwise) of
all or
substantially all the Assets or Business; (xi) acquire any equity securities
or
other interest in any Person or acquire all, or substantially all, of the
assets
of a Person; (xii) notify any Person that his/her/its actions constitute
an
infringement of the Intellectual Property or Proprietary Rights; (xiii)
sell,
pledge, assign, or otherwise dispose of, or impair, or grant any rights
with
respect to
the
Intellectual Property or Proprietary Rights used by the Business; (xiv) pay
or declare any dividend or distribution on its capital stock; or (xv)
agree to
do any of the foregoing.
8.2 Access
and Inspection.
At all
times prior to Closing, the Chex Entities shall permit Game Financial and
its
authorized agents and representatives to have reasonable access, upon reasonable
notice and during normal business hours, to the Assets and all books, records
and documents of or relating to the Business and the Assets, and shall
furnish
to Game Financial such information and data, financial records and other
documents in their possession relating to the Business and the Assets as
reasonably requested. The Chex Entities shall permit Game Financial and
its
agents and representatives reasonable access to their accountants for reasonable
consultation or verification of any information obtained by Game Financial
during the course of any investigation conducted pursuant to this subsection.
No
investigation or findings of Game Financial shall diminish or affect the
representations and warranties of the Chex Entities hereunder or relieve
them of
any obligation hereunder.
8.3 Confidentiality.
The
Confidentiality Agreement is incorporated into this Agreement by reference,
and
Game Financial and the Chex Entities shall be deemed to be parties to and
obligated by that Confidentiality Agreement. The Confidentiality Agreement
shall
continue in full force and effect from the Effective Date through the Closing
in
accordance with its terms. From and after the Closing Date, the Chex Entities
shall, and shall cause their Affiliates and their respective officers,
directors, employees and advisors (collectively, the “Recipients”) to keep
confidential any information relating to the Business, except for any such
information that: (i) is available to the public on the Closing Date; (ii)
thereafter becomes available to the public other than as a result of a
disclosure by a Chex Entity or a Recipient; or (iii) is or becomes available
to
a Chex Entity or a Recipient on a non-confidential basis from a source
that to
the Chex Entities and Recipient’s knowledge is not prohibited from disclosing
such information by a legal, contractual or fiduciary obligation to any
other
Person. Nothing contained in this subsection shall prohibit a Chex Entity
from
disclosing any information to the extent necessary in connection with any
Action
by or against such Chex Entity or any of its Affiliates. Should a Chex
Entity or
Recipient be required to disclose any such information in response to a
Governmental Order or as otherwise required by Law or administrative process,
it
shall inform Game Financial in writing of such request or obligation as
soon as
possible after such Chex Entity or Recipient is informed of it and, if
possible,
before any information is
disclosed,
so that a protective order or other appropriate remedy may be obtained
by Game
Financial. If a Chex Entity or such Recipient is obligated to make such
disclosure, it shall only make such disclosure to the extent to which it
is so
obligated. Notwithstanding the foregoing, Game Financial shall be permitted
to
share Confidential Information with Fidelity and its Affiliates for the
purpose
of their approving this Agreement and the transactions contemplated hereby,
provided that Fidelity agrees to keep such information confidential and
to use
it only in connection with evaluating this Agreement and the transactions
contemplated hereby.
8.4 Further
Actions.
Subject
to the terms and conditions set forth in this Agreement, the Chex Entities
and
Game Financial shall each act in good faith and use their respective
commercially reasonable efforts to take, or cause to be taken, all appropriate
action, and to do, or cause to be done, and to assist and cooperate with
each
other in doing all things necessary, proper or advisable under applicable
Laws
to consummate the transactions contemplated by this Agreement. For the
sake of
clarity, it is understood that the use of commercially reasonable efforts
by
Game Financial shall not include
paying any fee (other than fees to Game Financial’s legal and accounting
advisors) to obtain a third party’s consent to the transactions contemplated by
this Agreement. From time to time and at any time, at Game Financial’s
reasonable request, whether on or after the Closing Date, and without further
consideration, the Chex Entities shall, at their expense, execute and deliver
such further documents and instruments of conveyance, assignment and transfer
and shall take such further reasonable actions as may be necessary or reasonably
desirable, in the reasonable opinion of Game Financial, to transfer and
convey
to Game Financial all right, title and interest in and to the Assets, free
and
clear of any and all Liens (other than Permitted Liens), or as may otherwise
be
necessary or reasonably desirable to carry out the intent of this
Agreement.
8.5 Publicity.
The
Chex Entities and Game Financial shall cooperate with each other in the
development and distribution of all news releases, other public disclosures
and
customer communications relating to the transactions contemplated by this
Agreement. Neither the Chex Entities nor Game Financial shall issue or
make, or
allow to be issued or made, any press release or public announcement or
customer
communications concerning the transactions contemplated by this Agreement
(including the Form 8-K referenced below) without the written consent of
the
other party, except as otherwise required by applicable Law after giving
the
other party a reasonable opportunity to comment on such release or announcement
in advance, consistent with such applicable legal requirements. In that
regard,
the parties acknowledge that FastFunds and Certegy, Inc. (Game Financial’s
ultimate parent company) are companies subject to the periodic reporting
requirements of Section 13 of the Securities Exchange Act of 1934, and
FastFunds
will, and Certegy may, be required to file a current report on Form 8-K
with the
Securities and Exchange Commission within four business days of the execution
and delivery of this Agreement. Such report will disclose the parties to,
and
provide a general description of the basic material terms of, this
Agreement.
8.6 Transaction
Costs.
Each
party shall pay their own transaction costs and expenses (including any
legal,
accounting and other professional fees and expenses) incurred in connection
with
the negotiation, execution and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement, whether
or not
those transactions are consummated. Notwithstanding the foregoing, the
Chex
Entities shall pay any
and
all
Taxes (including penalties and interest) and the fees and costs of recording
or
filing all applicable conveyance instruments, if any, associated with the
transfer of Assets to Game Financial when
due.
The
parties shall reasonably cooperate with one another in obtaining any certificate
or other document from a Governmental Authority or other Person that is
necessary to mitigate, reduce or eliminate any Tax that could be imposed
as a
consequence of the transactions contemplated by this Agreement.
8.7 Employees
and Employee Benefit Matters.
Game
Financial, in its sole discretion, shall be permitted, but not required,
to
offer employment to any Business Employees for employment after Closing
(each
Business Employee that accepts that offer being referred to as a “Transferred
Employee”). Except for the terms and conditions under which Game Financial may
offer such employment, Game Financial shall have no liability or obligation
to
any employee of a Chex Entity or their Affiliates; Game Financial’s current
practice (which is subject to change in its sole discretion) is to provide
medical insurance and 401k eligibility on the first day of the first month
following an employee’s hire. The Chex Entities shall be solely liable and
responsible for the payment of any bonus, severance pay, unemployment
compensation or any other payments listed on Schedule
6.9(b),
including any severance payments owed as a consequence of their employment
or
termination of their employment prior to the Closing Date. This Agreement
does
not restrict the right of Game Financial to review and change its employment
policies, terms and benefits at any time or from time to time, or to terminate
any employee, including any Transferred Employee. The Chex Entities shall
be
solely responsible for, and Game Financial shall have no liability with
respect
to, terminating or maintaining any Chex Entity Benefit Plans.
8.8 Retention
of and Access to Records.
For a
period of six (6) years following the Closing Date, the Chex Entities shall
preserve all books and records that may relate to the Business but are
not
transferred to Game Financial pursuant to this Agreement. Upon the expiration
of
such six (6) year period and for a ninety (90) day period thereafter, the
Chex
Entities shall provide Game Financial a reasonable opportunity to obtain
copies,
at Game Financial’s expense, of any of such books and records. In addition to
the foregoing, from and after the Closing, the Chex Entities shall afford
Game
Financial and its counsel, accountants and other authorized agents and
representatives, during normal business hours, reasonable access to the
employees, books, records and other data relating to the Assets, the Assumed
Liabilities, the Transferred Employees and the Excluded Liabilities in
their
possession with respect to periods prior to the Closing, and the right
to make
copies and extracts therefrom, to the extent that such access may be permitted
under applicable Law and reasonably required by the requesting party: (a)
to
facilitate the investigation, litigation and final disposition of any claims
that may have been or may be made against any such party or Person, or
its
Affiliates, and (b) for the preparation of Tax Returns and in response
to
audits.
8.9 Insurance.
Effective 11:59 p.m. (Eastern Time)
on
the Closing Date, the Business shall cease to be insured by the Chex Entities
or
their Affiliates’ insurance policies; provided, however, that with respect to
insurance coverage written on an “occurrence basis”, to the extent that the
Business was insured under such policies, Game Financial shall, with respect
to
the Business, have rights under such policies to the extent the events
giving
rise as a claim under such policies occurred prior to 12:00 midnight (Eastern
Time) on the Closing Date. The Chex Entities agree to cooperate with Game
Financial in making claims under their insurance policies
in
connection with insurable events that occurred prior to 12:00 midnight
(Eastern
Time) on the Closing Date, and shall remit any associated recoveries promptly
to
Game Financial.
8.10 Exclusivity.
Between
the Effective Date and the earlier of Closing or termination of this Agreement,
the Chex Entities and their respective Affiliates will not (and shall cause
their respective agents, employees and Affiliates not to), directly or
indirectly: (i) sell or agree to sell, or solicit any proposal from, or
initiate
or engage in discussions or negotiations with, any Person or group of Persons
other than Game Financial and its Affiliates and representatives, concerning
any
proposal to acquire, directly or indirectly, and through an asset or stock
acquisition, merger or other structure, the Business, the Assets, or any
portion
thereof; (ii) provide confidential information concerning the Business
or the
Assets to any such person or group for use in the evaluation
of a potential acquisition of all or a material portion of the Assets or
Business;
or (iii)
otherwise cooperate in any way with, assist, participate in, facilitate
or
encourage, any effort or attempt by any other Person to do or seek any
of the
foregoing; provided, however, that the board of directors of FastFunds
may, to
the extent it determines in good faith (after consultation with outside
legal
counsel) that the failure to take any of the foregoing prohibited actions
could
create a reasonable possibility of a breach of its fiduciary duties to
the
stockholders of FastFunds under applicable Law, take any of the following
actions to the extent such board of directors determines reasonably necessary
to
satisfy such fiduciary duties: (A) furnish information with respect to
the Chex
Entities to any Person pursuant to a customary confidentiality agreement;
or (B)
participate in negotiations regarding an Acquisition Proposal. The Chex
Entities
will promptly provide Game Financial written notice of their receipt of
any
Acquisition Proposal setting forth the material terms and conditions of
such
proposal, shall provide copies of all information provided to a Person
pursuant
to this subsection, and shall keep Game Financial fully informed of all
negotiations regarding an Acquisition Proposal entered into in accordance
with
this subsection.
8.11 Covenant
Not to Compete.
For
a
period of five (5) years after the Closing Date each Chex Entity covenants
and
agrees that it will not, and it will cause each of its Affiliates not to,
directly or indirectly (including by licensing or other partial right
transfers),
anywhere in the world: (i) own any interest in, manage, control, participate
in,
consult with or render services for any business activity relating to the
Business (the “Restricted Business”); (ii) in any capacity whatsoever (including
as a stockholder, proprietor, partner, joint venturer, member, consultant,
agent, lender, or otherwise), directly or indirectly, solicit, sell, service,
divert, or accept any Restricted Business from, or to, (A) any of the customers
of either Game Financial or any of its Affiliates as of the date hereof
or (B)
any persons who were customers of either the Chex Entities, Game Financial
or
any of their Affiliates at any time during the five (5) year period ending
on
the date of this Agreement (other than on behalf of, and at the direction
of,
Game Financial or its Affiliates); (iii) through another entity induce
or
attempt to induce any customer, supplier, licensee, licensor, or other
business
relation of Game Financial or any of its Affiliates to cease doing business
with
Game Financial or any of its Affiliates, or in any way interfere with the
relationship between any such customer, supplier, licensee or business
relation
and Game Financial or any of its Affiliates (including making any negative
statements or communications about Game Financial or any of its Affiliates);
(iv) through another entity solicit, induce or conspire with or attempt
to
solicit, induce, or conspire with any employee or officer of Game Financial
or
any of its Affiliates to leave the employ of Game Financial or any of its
Affiliates,
or
to
compete against Game Financial or any of its Affiliates, or in any way
interfere
with the relationship between Game Financial or any of its Affiliates and
any
employee or officer thereof; or (v) divert or attempt to divert any or
all of
such customers’ or suppliers’ business with them from them in violation of this
Agreement or applicable Law (including the violation of any trade secrets
law).
The parties agree that the restrictive covenants
contained in this subsection are reasonable under the circumstances and
further
agree that these covenants should be interpreted so as to be effective
and valid
under applicable Law. If any one or more of the provisions contained in
this
subsection shall be held excessively broad as to duration, geographical
scope,
activity or subject, such provision shall be construed by limiting or reducing
it so as to be enforceable to the maximum extent compatible with applicable
Law.
For purposes of this subsection, the terms “Chex,” “Chex Entities,” and “Game
Financial” shall include their respective successors and assigns.
8.12 Equitable
Remedies.
The
Chex Entities and Game Financial each acknowledge that any breach or threatened
breach of either of the provisions of Subsections
8.10 or 8.11
will
cause irreparable injury for which an adequate monetary remedy does not
exist.
Accordingly, in the event of any such breach or threatened breach, Game
Financial and the Chex Entities, as applicable, shall be entitled, in addition
to the exercise of other remedies, to seek and (subject to court approval)
obtain injunctive relief, without: (i) the necessity of posting a bond
restraining the applicable party from committing such breach or threatened
breach; or (ii) providing any form of security for costs or damages.
8.13 Intellectual
Property.
If,
after Closing, a Chex Entity or any of their Affiliates, or any Person
owned or
controlled by them, owns or shall at any time acquire any rights in any
trademarks, trade names or other Intellectual Property or Proprietary Rights
relating to the Business and any goodwill
relating to or symbolized thereby, such party shall promptly cause such
trademarks, trade names or other Intellectual Property and Proprietary
Rights,
as applicable, including any goodwill associated therewith and the right
to sue
for past infringement, to be immediately transferred to Game Financial
(subject
to Game Financial’s right to refuse any such transfer). Such party agrees to
execute and deliver such further grants and assignments, without any additional
consideration, as Game Financial may request for the purpose of further
evidencing, enforcing, registering or defending Game Financial’s right, title
and interest in and to such trademarks, trade names and other Intellectual
Property or Proprietary Rights. Such party hereby constitutes and appoints
Game
Financial as such party’s agent to execute and deliver any such assignments,
grants and other documents that such party fails to execute and deliver,
this
power and agency being coupled with an interest and being
irrevocable.
8.14 Endorsement
of Checks.
Following the Closing, the Chex Entities authorize Game Financial to endorse
for
deposit in its name, and collect for Game Financial’s account, any any refunds
of deposits, prepaid expenses and similar amounts collected in connection
with
the operation of the Business. In the event any payments due Game Financial
are
received by a Chex Entity, such Chex Entity will promptly turn same over
to Game
Financial.
8.15 Approval
of Stockholders.
(a) Stockholders’
Approval.
Concurrent with the execution of this Agreement, FastFunds and Chex will
have
obtained a consent in writing in lieu of a meeting from holders of the
majority
of the outstanding capital stock of FastFunds and the owners of all the
outstanding capital stock of Chex, respectively, in accordance with applicable
Law and Organizational Documents, for the approval of: (i) this Agreement
and
the Ancillary Agreements; and (ii) the transactions contemplated hereby
and
thereby (the “Stockholders Approval”). Concurrent with the execution of this
Agreement, Equitex and FastFunds will have also entered into voting agreements
in a form reasonably satisfactory to Game Financial.
(b) Information
Statement.
As soon
as practicable following the execution of this Agreement (but in no event
later
than 2 Business Days following such execution), FastFunds shall prepare
and file
a preliminary information statement conforming to the requirements of Schedule
14C promulgated by the Securities and Exchange Commission relating to its
Stockholder Approval (such information statement as amended or supplemented
from
time to time being referred to as the “Information Statement”). FastFunds shall
use its reasonable best efforts to cause the definitive Information Statement
to
be mailed to its stockholders at the earliest practicable date. FastFunds
shall
give Game Financial and its counsel a meaningful opportunity to review
and
comment on its Information Statement, including all amendments and supplements
thereto, in each case in advance of filing with the Securities and Exchange
Commission or any other regulatory body.
8.16 Cooperation.
(a) The
Chex
Entities and Game Financial shall cooperate with each other and use all
reasonable best efforts to take or cause to be taken all actions, and do
or
cause to be done all things, necessary, proper or advisable under this
Agreement
and applicable Laws to consummate and make effective the transactions
contemplated by this Agreement and the Ancillary Agreements as soon as
practicable, including preparing and filing as promptly as practicable
all
documentation to effect all necessary applications, notices, petitions,
filings
and other documents and to obtain as promptly as practicable all permits,
consents, approvals and authorizations necessary or advisable to be obtained
from any third party and/or any Governmental Authority in order to consummate
the transactions contemplated by this Agreement and the Ancillary Agreements.
Subject to applicable Laws relating to the exchange of information, Game
Financial and the Chex Entities shall have the right to review in advance,
and
to the extent practicable each will consult the other on, all the information
relating to Game Financial or the Chex Entities, as the case may be, that
appear
in any filing made with, or written materials submitted to, any third party
and/or any Governmental Authority in connection with the transactions
contemplated by this Agreement or the Ancillary Agreements. In exercising
the
foregoing right, each of Game Financial and the Chex Entities shall act
reasonably and as promptly as practicable. Notwithstanding the foregoing,
Game
Financial shall not be required to consult, disclose or share with the
Chex
Entities information or materials provided to Fidelity and its Affiliates.
Without limiting the generality of the foregoing, (i) the Chex Entities
shall
cooperate with Game Financial in obtaining the necessary interim and permanent
Licenses for Game Financial to operate the Business post-Closing, and (ii)
Game
Financial shall be permitted to designate as additional Assets and Assumed
Contracts such additional Chex Entity contracts
relating
to the Business as it may choose prior to Closing, without an increase
in
purchase price, and the Chex Entities will cooperate in obtaining any required
consents to assignment. Chex shall also use commercially reasonable efforts
to
obtain written, signed, contracts for locations it currently provides Business
services to on oral agreement, and upon Game Financial’s written approval, these
shall also become additional Assumed Contracts.
(b) The
Chex
Entities and Game Financial each shall, upon request by the other, furnish
the
other with all information concerning itself, its Subsidiaries, directors,
officers and stockholders and such other matters as may be reasonably necessary
or advisable in connection with the Information Statement, or any other
statement, filing, notice or application made by or on behalf of Game Financial,
a Chex Entity or any of their respective Subsidiaries to any third party
and/or
any Governmental Authority in connection with the transactions contemplated
by
this Agreement or the Ancillary Agreements.
(c) FastFunds
shall have sixty (60) calendar days from the Closing in which to change
its
name, and Game Financial hereby grants a limited irrevocable license to
FastFunds to use such name for such period (which license shall terminate
automatically upon a change in FastFunds’ name).
8.17 Further
Assurances.
From
time to time and at any time, at Game Financial’s reasonable request, whether
before, on or after the Closing Date, and without further consideration,
the
Chex Entities shall, at their expense, execute and deliver such further
documents and instruments of conveyance, assignment and transfer and shall
take
such further reasonable actions as may be necessary or reasonably desirable,
in
the reasonable opinion of Game Financial, to transfer and convey to Game
Financial all right, title and interest in and to the Assets, free and
clear of
any and all Liens, or as may otherwise be necessary or reasonably desirable
to
carry out the intent of this Agreement.
8.18 Supplemental
Disclosures.
(a) After
the
Effective Date and prior to Closing, the Chex Entities shall deliver to
Game
Financial supplemental disclosure schedules (each a “Supplemental Disclosure
Schedule”) setting forth all changes in facts and circumstances described in the
Schedules originally delivered upon the execution and delivery of this
Agreement
(the “Original Disclosure Schedules”), and in previously delivered Supplemental
Disclosure Schedules, if any, arising out of matters discovered or occurring
after the Effective Date but prior to the Closing Date. Such Supplemental
Disclosure Schedules shall be delivered to Game Financial promptly after
the
discovery of any such change from the Original Disclosure Schedules. Each
Supplemental Disclosure Schedule shall be accompanied by all available
information related to the newly disclosed matter necessary for Game Financial
to adequately evaluate such change and shall identify all representations
and
warranties in this Agreement that are affected by the changes. The delivery
of a
Supplemental Disclosure Schedule with respect to any fact or matter existing
but
not yet known by a Chex Entity as of the date of this Agreement shall not
cure
or otherwise be deemed a waiver of any inaccuracy or misrepresentation
in any
representation or warranty to the extent such representation or warranty
is not
qualified by knowledge. If a representation or warranty is qualified by
Knowledge, the applicable Supplemental Disclosure Schedule shall
be
accompanied
by a certificate from the Secretary of such Chex Entity certifying that
it had
no Knowledge of such fact or matter as of the Effective Date.
(b) If
any
Supplemental Disclosure Schedule relates to a period prior to the Effective
Date, Game Financial shall have the right, but not the obligation, to terminate
this Agreement pursuant to Subsection
11.1.
The
failure of Game Financial to so terminate this Agreement shall not constitute
a
waiver of any claim for indemnified Losses that Game Financial may have
as a
result of the operation of the provisions of Section
10.
(c) If
any
Supplemental Disclosure Schedule is not material and relates to a period
or
occurrence after the Effective Date, Game Financial shall not have the
right to
terminate this Agreement pursuant to Subsection
11.1,
but
shall be entitled to indemnification with respect to any matter revealed
in such
Supplemental Disclosure Schedule to the extent of any Losses suffered or
incurred in connection therewith in accordance with Section
10.
(d) If
any
information revealed in a Supplemental Disclosure Schedule is material
and
relates to a period or occurrence after the Effective Date, Game Financial
shall
have the right, but not the obligation, to terminate this Agreement pursuant
to
Subsection
11.1.
The
failure of Game Financial to so terminate this Agreement shall not constitute
a
waiver of any claim for Losses that Game Financial may have as a result
of the
operation of the provisions of Section
10.
9. Conditions
to Closing.
9.1 Game
Financial’s Conditions to Closing.
The
obligation of Game Financial to consummate the transactions contemplated
by this
Agreement are subject to the satisfaction or fulfillment of the following
conditions at or prior to Closing, any of which may be waived in whole
or in
part by Game Financial in writing:
(a) all
representations and warranties of the Chex Entities contained in this Agreement
shall be true and correct in all material respects as of the date when
made and
will be deemed to be made again at and as of the Closing Date and will
be true
and correct in all respects at and as of the Closing Date;
(b) the
Chex
Entities performing and complying in all material respects with all the
covenants
and
agreements and conditions required by this Agreement to be performed or
complied
with at or prior to the Closing;
(c) no
Material Adverse Change having occurred, and no event having occurred that
could
reasonably be expected to have a Material Adverse Change;
(d) there
being no Law or Governmental Order making illegal or otherwise prohibiting
or
restraining the operation of the Business or the consummation of the
transactions contemplated by this Agreement;
(e) the
Chex
Entities executing
and delivering to Game Financial all Bills of Sale, Assignment Agreements,
leases, assignments and other instruments of transfer, including assignments
of
Intellectual Property and Proprietary Rights, as Game Financial may reasonably
require to transfer good and marketable title to the Assets, free and clear
of
all Liens other than Permitted Liens (collectively, “Bills of Sale and
Assignment Agreements”);
(f) Each
Chex
Entity delivering to Game Financial an officer’s certificate, duly executed by
an authorized officer of such Chex Entity, certifying that the conditions
set
forth in Subsections
9.1(a) and (b)
are
fully satisfied;
(g) Each
Chex
Entity delivering to Game Financial a secretary’s or assistant secretary’s
certificate, reasonably satisfactory to Game Financial, duly executed by
such
authorized
officer, certifying that: (i) approval for the execution and delivery of
the
Agreement, the Ancillary Agreements and the transactions contemplated thereby
has been obtained; (ii) the good-standing status of such Chex Entity; and
(iii)
the incumbency and true signatures of the individuals of such Chex Entity
authorized to act on behalf of such Chex Entity;
(h) Game
Financial having received an opinion from
legal
counsel for the Chex Entities containing opinion points in substantially
the
form attached hereto as Schedule
9.1(h);
(i) all
Required Consents and the consents to assignment noted on Schedule
3 shall
have been obtained in form and substance reasonably satisfactory to Game
Financial and its counsel and shall remain in full force and effect as
of the
Closing Date;
(j) Game
Financial having received from the following Persons releases satisfactory
to it
(in its Game reasonable discretion) terminating their agreements with the
Chex
Entities and waiving all rights to Ongoing Commissions: James P. Welbourn
and
George E. Connors;
(k) Henry
Fong, Michael Cassaza, James P. Welbourn, and Barry Hollander executing
Confidentiality, Invention Assignment, Non-Competition and Non-Solicitation
Agreements with Game Financial in a form reasonably satisfactory to Game
Financial (including a covenant not to compete on terms substantially the
same
as contained in Subsection
8.11);
(l) Game
Financial receiving releases or satisfactions of all Liens on the Assets
(at the
sole expense of the Chex Entities), other than Permitted Liens, in a form
reasonably satisfactory to Game Financial, including UCC
search results demonstrating that there are no Liens on the Assets (other
than
Permitted Liens);
(m) Game
Financial having received evidence of the requisite Chex Entity stockholder
and
board of directors approval of: (i) this Agreement and the Ancillary Agreements;
and (ii) the transactions contemplated by this Agreement and the Ancillary
Agreements;
(n) all
actions, proceedings, certificates, instruments and documents required
to carry
out the transactions contemplated by this Agreement, and all other legal
matters
required for such transactions, shall have been reasonably satisfactory
to Game
Financial prior
to
Closing;
(o) no
Action
shall have been commenced by any Governmental Authority or Person with
respect
to or seeking to enjoin or prohibit the transactions contemplated by this
Agreement;
(p) [Reserved];
(q) Game
Financial receiving the Licenses listed on Schedule
9.1(q)
on terms
and conditions reasonably satisfactory to it;
(r) the
ATMs
listed on Schedule 6.26 having been properly loaded with Game Financial’s
software applications in accordance with Game Financial’s
instructions;
(s) the
contract for the Potawatomi properties having been renewed on terms and
conditions satisfactory to Game Financial (in its reasonable discretion),
at
FastFunds’ cost, and consent to assignment of that contract to Game Financial
having been obtained;
(t) Chex
entering into a transitional services agreement in the form attached hereto
as
Schedule 9.1(t);
(u) there
having been no developments in the litigation described on Schedule
6.12
that,
in the reasonable opinion of Game Financial, are adverse; provided, however,
that this Subsection
9.1(u)
is not a
condition to closing the entire transaction, but is instead a condition
of Game
Financial’s obligation to assume the Assumed Contracts impacted by such
litigation;
(v) The
receipt by Game Financial, in substance and form satisfactory to it (in
its
reasonable discretion), of consents and Lien releases from Equitex, Whitebox
Hedged High Yield Partners, L.P., and Pandora Select Partners, L.P. in
connection with the March 8, 2004 financing; and
(w) The
receipt by Game Financial, in substance and form satisfactory to it (in
its
reasonable discretion) of a waiver by the Little River Band of Ottawa Indians
of
its right to terminate if George Connors is no longer working for Chex
or its
successor under the Financial Services Agreement, dated June 21, 2002 (as
amended).
9.2 Chex
Entities’ Conditions to Closing.
The
obligation
of the
Chex Entities to consummate the transactions contemplated by this Agreement
are
subject to the satisfaction or fulfillment at or prior to the Closing of
the
following conditions, any of which may be waived in whole or in part by
the Chex
Entities in writing:
(a) all
representations and warranties of Game Financial contained in this Agreement
being true and correct in all material respects as of the Closing;
(b) Game
Financial performing and complying in all material respects with all covenants
and agreements required by this Agreement to be performed or complied with
at or
prior to Closing;
(c) there
being no Law or Governmental Order making illegal or otherwise prohibiting
or
restraining the consummation of the transactions contemplated by this Agreement;
(d) Game
Financial having paid the Closing Cash Payment by wire transfer of immediately
available funds to an account designated in writing by the Chex Entities
at
least one (1) Business Day prior to the Closing Date;
(e) Game
Financial having executed and delivered instruments of assumption, in a
form
reasonably acceptable to the Chex Entities, pursuant to which Game Financial
shall assume the Assumed Liabilities;
(f) Game
Financial delivering to Chex an officer’s certificate, duly executed by an
authorized officer of Game Financial, that certifies that the conditions
set
forth in Subsections
9.2(a) and (b)
are
satisfied;
(g) Game
Financial delivering to Chex a secretary’s or assistant secretary’s certificate,
duly executed by such authorized officer, with corporate and authority
documents
attached as exhibits to each certificate;
(h) [Reserved];
and
(i) the
lapse
of 20 calendar days since the filing and mailing of the definitive Information
Statement described in Subsection
8.14(b).
10. Indemnification.
10.1 Indemnification
by Game Financial.
Game
Financial shall indemnify and hold the Chex Entities and their Affiliates,
officers, directors, employees, attorneys, agents, representatives, successors
and assigns (each, a “Chex Indemnified Party”) harmless from and against all
claims, losses, damages, liabilities, obligations, payments, penalties,
costs
and expenses of any nature (including, without limitation, the costs and
expenses of any and all actions, suits, proceedings, assessments, judgments,
settlements, compromises, fines and interest relating thereto and reasonable
attorneys’ fees and reasonable disbursements in connection therewith)
(collectively, “Losses”) arising out of or relating to: (i) any inaccuracy,
misrepresentation or breach by Game Financial of any representation or
warranty contained in this Agreement or in any document delivered pursuant
to
this Agreement; (ii) any nonperformance or breach of any covenant or agreement
made by Game Financial in this Agreement or in any document delivered pursuant
to this Agreement; (iii) the Assumed Liabilities to the extent the Action
arose
out of events that occurred after the Closing;
(iv)
the
ownership or operation of the Assets or the Business after the Closing
Date in
all respects other than the Excluded Liabilities; and (v) all Governmental
Orders, assessments, fees and expenses
incident
to any of the foregoing or incurred in investigating or attempting to avoid
the
same or to oppose the imposition thereof, or in enforcing this
indemnification.
10.2 Indemnification
by the Chex Entities.
Subject
to Subsection
10.7,
the
Chex Entities, jointly and severally, shall
indemnify and hold Game Financial and its Affiliates, officers, directors,
employees, attorneys, agents, representatives, successors and assigns (each,
a
“Game Financial Indemnified Party”) harmless against all Losses arising out of
or related to: (i) any inaccuracy, misrepresentation or breach by a Chex
Entity
of any representation or warranty contained in this Agreement or in any
document
delivered pursuant to this Agreement; (ii) any breach of any covenant or
agreement made by a Chex Entity in this Agreement or in any document delivered
pursuant to this Agreement; (iii) the Excluded Liabilities (regardless
of
whether information relating such Excluded Liabilities is set forth on
a
schedule); (iv) the ownership or operation of the Assets or the Business
prior
the Closing Date in all respects other than the Assumed Liabilities; (v)
all
Governmental Orders, assessments, fees and expenses incident to any of
the
foregoing or incurred in investigating or attempting to avoid the same
or to
oppose the imposition thereof, or in enforcing this indemnification; (vi)
any
act or omission by a Chex Entity with respect to the Business that occurred
prior to Closing, including any claim or Liabilities arising out of or
related
to the ownership, license, use, ownership or operation of the 3 in 1 Software
prior to the Closing Date; (vii) Ongoing Commissions, (vii) the litigation
described on Schedule 6.12.
10.3 Indemnified
Claims.
(a) A
party
entitled to indemnification under this Agreement (“Indemnified Party”) will give
the party required to provide such indemnification (“Indemnifying Party”) prompt
written notice of any Action with respect to which the Indemnified Party
is
entitled to indemnification (each an “Indemnified Claim”). The Indemnifying
Party shall have the right, by giving notice to the Indemnified Party within
ten
(10) days after receiving notice
of
an Indemnified Claim stating that the Indemnifying Party is responsible
for such
Indemnified Claim (“Indemnity Notice Period”),
at its
expense, to defend against, negotiate, settle or otherwise deal with any
Indemnified Claim with respect to which it is the Indemnifying Party and
to have
the Indemnified Party represented by counsel, reasonably satisfactory to
the
Indemnified Party and selected by the Indemnifying Party; provided, that
the
Indemnified Party may participate in any proceeding with counsel of its
choice
and at its expense; provided further, that Game Financial may, at any
time,
assume
the defense and settlement of an Indemnified Claim with counsel of its
choice,
and be fully indemnified therefor if
Game
Financial believes that a Chex Entity’s defense is: (i) having a Material
Adverse Change on the affairs, condition (financial or otherwise) or prospects
of the Business or the Assets; or (ii) could adversely affect or detract
from
the value of the Assets or the Business. The Indemnifying Party may not
enter
into a settlement of any Indemnified Claim without the advance written
consent
of the Indemnified Party unless such settlement requires no more than a
monetary
payment for which the Indemnified Party is fully indemnified. The parties
will
cooperate fully with each other in connection with the defense, negotiation
and/or settlement of each Indemnified Claim.
(b) If
the
Indemnifying Party does not assume the defense of, or if after so assuming
the
defense, the Indemnifying Party fails to defend any such Indemnified Claim,
then
the
Indemnified Party may defend against any Indemnified Claim in the manner
it
deems appropriate, and the Indemnified Party may settle the Indemnified
Claim on
the terms it deems appropriate, and the Indemnifying Party will promptly
reimburse the Indemnified Party for the amount of all expenses, legal and
otherwise, reasonably and necessarily incurred in connection with that
defense
and/or settlement. If no settlement of an Indemnified Claim is made, the
Indemnifying Party will satisfy any judgment rendered with respect to the
Indemnified Claim before the Indemnified Party is required to do so, and
shall
pay all expenses, legal or otherwise, reasonably and necessarily incurred
by the
Indemnified Party in the defense of any Indemnified Claim.
(c) If
a
judgment is rendered against an Indemnified Party in connection with any
Indemnified Claim, or an associated Lien attaches to any of the assets
of any of
an Indemnified Party, the Indemnifying Party will immediately upon any
entry or
attachment pay the relevant judgment in full or discharge the relevant
Lien
unless, at the expense and direction of the Indemnifying Party, an appeal
is
taken under which the execution of the judgment or satisfaction of the
Lien is
stayed. If and when a final judgment is rendered in any such Action, the
Indemnifying Party will immediately pay any judgment or discharge any Lien
before an Indemnified Party is compelled to do so.
(d) The
Indemnifying Party or the Indemnified Party, as appropriate, shall have
the
right to participate in the defense of any Indemnified Claim at its sole
cost
and expense.
10.4 No
Waiver of Indemnified Claims.
If on
the date of execution of this Agreement or the Closing Date, Game Financial
or
any of its Affiliates or representatives, has any knowledge of any breach
of any
representation, warranty, covenant or agreement made by a Chex Entity under
or
pursuant to this Agreement or any Ancillary Agreement, such knowledge shall
not
constitute a waiver of any associated Indemnified Claims that Game Financial
or
any other Game Financial Indemnified Party may have, or estop Game Financial
or
any other Game Financial Indemnified Party from asserting such Indemnified
Claims.
10.5 Injunctive
or Equitable Relief.
Nothing
set forth in this section shall be deemed to prohibit or limit a party’s right
to seek injunctive or other equitable relief for the failure of the other
party
to perform any covenant or agreement contained in this Agreement.
10.6 Treatment
of Indemnity Benefits.
All
payments made by a Chex Entity or
Game
Financial, as the case may be, to or for the benefit of the other party
pursuant
to any indemnification obligations under this Agreement shall be treated
as
adjustments to the Purchase Price for Tax purposes, and such agreed treatment
shall govern for purposes of this Agreement.
10.7 Limitations
on Indemnification.
The
indemnification obligations of the Chex Entities under this Agreement shall
not
be payable unless and until such time as the aggregate amount of claims
for
Losses of all Game Financial Indemnified Parties shall exceed Twenty Five
Thousand Dollars ($25,000) (the “Basket”), and thereafter to the full extent of
such Losses in excess of the Basket; provided, however, that in no event
shall
the indemnification obligations of the Chex Entities under this Agreement
exceed
Seventy Five Percent (75%) of the Purchase Price, as finally adjusted (the
“Cap”), except in the case of any willful misrepresentation
made
with
intent to deceive. Provided, however, that the Basket and Cap shall
not
apply to indemnification related to or arising out of Ongoing Commissions
or any
litigation described on Schedule
6.12 and
amounts paid in connection with such indemnification shall not count toward
the
Cap.
11. Termination.
11.1 Termination.
This
Agreement and the transactions contemplated by this Agreement may be terminated
at any time prior to the Closing: (i) by the mutual written consent of
all the
parties; (ii) by Game Financial if the Closing has
not
occurred on or prior to 5:00 P.M., Eastern Time, on February 28, 2006
(“Termination Date”), unless the Closing did not occur as a result of a breach
of this Agreement by Game Financial; (iii) by Game Financial, if a Material
Adverse Change in the business, assets, properties, operations, prospects,
condition (financial or otherwise), results of operations of the Business
has
occurred or is reasonably likely to occur; (iv) by Game Financial, pursuant
to
Subsections
8.18(b) or 8.18(d);
(v) by
Game Financial if any Governmental Authority issues a Governmental Order
restraining, enjoining or otherwise prohibiting the consummation of the
transactions contemplated by this Agreement; (vi) by Game Financial, if
a Chex
Entity breaches any representation or warranty contained in this Agreement
or an
Ancillary Agreement, and such breach is incapable of being cured ; (vii)
by the
Chex Entities, if Game Financial breaches any representation or warranty
contained in this Agreement or an Ancillary Agreement, and such breach
is
incapable of being cured or is not cured prior to the Termination Date;
(viii)
by Game Financial, if the satisfaction of any condition to the obligations
of
Game Financial set forth in Subsection
9.1
becomes
impossible; or (ix) by the Chex Entities if the satisfaction of any condition
to
the obligations of the Chex Entities set forth in Subsection
9.2
becomes
impossible. Notwithstanding the foregoing, this Agreement may not be
terminated
under
this subsection by any party that is in material breach of this Agreement
at the
time termination is attempted. In addition, the Chex Entities shall have
the
right of termination set forth in Subsection
11.3.
11.2 Procedure
and Effect of Termination. Except
as
otherwise indicated in this section, (i) if this Agreement is terminated
pursuant to Subsection
11.1
at a
time when no party is in material breach of this Agreement, all further
obligations of the Chex Entities to Game Financial, and of Game Financial
to the
Chex Entities, will terminate without further liability; and (ii) if this
Agreement is terminated under Subsection
11.1
at a
time when one or more parties is in material breach of this Agreement,
the
liabilities and obligations of the party or parties not in breach shall
terminate, and the party or parties that are in breach shall remain liable
for
such breach, and nothing shall be deemed to restrict the remedies available
against such party or parties. The obligations of the parties under Subsections
8.3 (Confidentiality), 8.5 (Publicity), 8.6 (Transaction Costs), and Sections
10
(Indemnification) and 11 (Termination)
shall
survive any termination of this Agreement. In the event of termination
of this
Agreement pursuant to Subsection
11.1,
written
notice of the termination must be given by the terminating party at least
three
(3) Business Days prior to the date of termination. If this Agreement is
properly and rightfully terminated, all filings, applications and other
submissions made pursuant to this Agreement shall be withdrawn from the
agency
or other Person to which they were made.
(a) Additional
Termination Right.
The
Chex Entities may terminate this Agreement if, prior to the Closing Date,
the
board of directors of FastFunds determines in good faith (after consultation
with outside legal counsel and financial advisors), in the exercise of
its
fiduciary duties, that an Acquisition Proposal not solicited or initiated
in
violation of this Agreement (including Subsections
8.1, 8.3, and 8.10)
is a
Superior Proposal, but only (i) after providing to Game Financial a Notice
of
Superior Proposal with respect to such Superior Proposal, and (ii) if Game
Financial does not, within ten (10) Business Days of its receipt of the
Notice
of Superior Proposal, make an offer that the FastFunds board determines,
in its
good faith judgment (after consultation with its outside legal counsel
and
financial advisors) to be at least as favorable to FastFunds and its
stockholders as such Superior Proposal; provided that during such ten (10)
Business Day period, the Chex Entities shall negotiate in good faith with
Game
Financial (to the extent Game Financial wishes to negotiate) to enable
Game
Financial to make such an offer; and provided, further, that, in the event
of
any material amendment to the financial or other terms of such Superior
Proposal, the FastFunds board shall deliver to Game Financial an additional
written Notice of Superior Proposal, and the ten (10) Business Day period
referenced above shall be extended for an additional ten (10) Business
Days
after Game Financial’s receipt of such additional Notice of Superior Proposal;
provided, however, that any purported termination pursuant to this Subsection
11.3
shall be
void and of no force or effect unless FastFunds and/or Chex pays the Termination
Fee as provided below. FastFunds shall keep Game Financial reasonably informed
of the status of any proposals and offers for which FastFunds has delivered
a
Notice of Superior Proposal to Game Financial hereunder.
(b) Termination
Fee.
If the
Chex Entities terminate this Agreement in accordance with Subsection
11.3(a)
then
FastFunds shall pay to Game Financial One Million Dollars ($1,000,000)
(the
“Termination Fee”). FastFunds shall pay the Termination Fee as directed by Game
Financial in writing in immediately available funds concurrently with and
as a
condition to the effectiveness of a termination of this Agreement.
(c)
For
purposes of this Agreement:
(i) “Acquisition
Proposal”
means
any proposal or offer to enter into a transaction with any Chex Entity
or their
Affiliates or stockholders, in any form, for the acquisition (directly
or
indirectly, through asset sale, change of control, stock purchase, merger
or
otherwise) of the Business, Chex, FastFunds or the Assets.
(ii) “Superior
Proposal”
means
any bona fide written Acquisition Proposal that is on terms that the FastFunds
board determines in its good faith judgment (after consultation with its
financial advisor and its outside legal counsel and after taking into account
all the terms and conditions of the Acquisition Proposal and this Agreement,
including the form of consideration) are more favorable to FastFunds and
its
stockholders (in their capacities as stockholders), from a financial point
of
view, than this Agreement (taking into account any alterations to this
Agreement
agreed to in writing by Game Financial in response thereto).
(iii) “Notice
of Superior Proposal”
means
a
written notice describing in detail the material terms and conditions of
a
Superior Proposal, such notice to include copies of
all
agreements, proposed agreements, letters of interest or intent, and other
written materials delivered to a Chex Entity, Affiliate or stockholder
in
connection with such Superior Proposal, as the same may be updated, changed
or
supplemented from time to time.
(d) Agreement
Regarding Termination Fee.
Each of
the Chex Entities and Game Financial acknowledge that the agreements contained
in the Subsection
11.3
are an
integral part of the transactions contemplated by this Agreement. If the
Chex
Entities shall fail to pay the Termination Fee when due, the Chex Entities
shall
reimburse Game Financial for all reasonable costs and expenses actually
incurred
or accrued by it (including reasonable attorneys fees) in connection with
the
enforcement and collection of the Termination Fee. The Chex Entities shall
be
jointly and severally liable for the payment of the Termination
Fee.
12. Miscellaneous.
12.1 Assignment.
This
Agreement shall be binding upon and inure to the sole and exclusive benefit
of
the parties and their respective successors and permitted assigns, provided
that
neither this Agreement, the Ancillary Agreements nor any of the rights,
interests or obligations under this Agreement or the Ancillary Agreements
may be
assigned or delegated by a party without the prior written consent of all
other
parties, and any purported assignment or delegation shall be null and void.
Notwithstanding the foregoing, Game Financial may assign its rights (but
not
delegate its obligations) under this Agreement to a direct or indirect
subsidiary of Certegy, Inc. without the Chex Entities’ consent.
12.2 Governing
Law.
This
Agreement will be governed by and construed and interpreted in accordance
with
the substantive Laws of the State of Florida, USA, without giving effect
to any
choice-of-law or conflicts-of-law provisions. The prevailing party in any
action
arising out of this Agreement shall be entitled to the recovery of its
reasonable attorneys fees. ANY CONTROVERSY ARISING OUT OF THIS AGREEMENT
IS
LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH
PARTY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY
WITH RESPECT TO SUCH CONTROVERSIES. THE PARTIES UNDERSTAND AND HAVE CONSIDERED
THE IMPLICATIONS OF THIS WAIVER, AND EACH MAKES IT VOLUNTARILY.
12.3 Waiver.
Neither
party shall be deemed to waive any of its rights under this Agreement without
agreeing to do so in writing. No waiver of a breach of this Agreement shall
constitute a waiver of any prior or subsequent breach of this Agreement.
No
delay on the part of any party in exercising any right, power or privilege
under
this Agreement shall operate as a waiver, nor shall any single or partial
exercise of any right, power or privilege preclude any other or further
exercise
or the exercise of any other right, power or privilege. Whenever this Agreement
requires or permits consent by or on behalf of a party, that consent must
be
given in writing in a manner consistent with the requirements for a waiver
as
set forth in this subsection.
12.4 Force
Majeure.
Neither
party shall be liable for any loss or damage due to causes beyond its reasonable
control, including earthquake, war, fire, flood, power failure, terrorist
acts,
acts of God or other catastrophes.
12.5 Headings;
Construction.
The
headings that appear in this Agreement are inserted for convenience only
and do
not limit or extend its scope. Each of the obligations contained in this
Agreement are in addition to any other similar obligation contained in
any other
document entered into in connection with this Agreement, and are not intended
in
any way, form or fashion to limit the applicability of such other obligation.
The parties agree that all obligations contained in this Agreement, are
necessary and fundamental to the ongoing operation of the Business. Except
as
otherwise expressly provided, or unless the context otherwise requires:
(i)
words using the singular or plural number also include the plural or singular
number, respectively, and the use of any gender herein shall be deemed
to
include the other gender; (ii) references to “sections,” “subsections” and other
subdivisions without reference to a document are referring to the specified
sections, subsections and other subdivisions of this Agreement; (iii) a
reference to a subsection without further reference to a section is a reference
to the subsection contained within the same section in which the reference
appears; and (iv) the words “include,” “includes” and “including” are to be read
as being followed by the phrase “without limitation.” All accounting terms used
in this Agreement that are not expressly defined shall have the meanings
given
to them under GAAP. All references to “dollars” or “$” shall mean United States
dollars.
12.6 Entire
Agreement.
This
Agreement constitutes the entire understanding of the parties with respect
to
its subject matter, and all prior agreements, understandings and representations
relating to that subject matter are canceled in their entirety. The exhibits,
schedules and each of the Ancillary Agreements are hereby incorporated
by
reference into and made a part of this Agreement for all purposes.
12.7 Neutral
Construction.
This
Agreement was negotiated fairly between the parties at arms’ length, and the
final terms are the product of the parties’ negotiations. Each party has sought
and received legal counsel of its own choosing with regard to this Agreement
and
the rights and obligations affected by it. This Agreement shall be construed
equally against the parties regardless of who is more responsible for its
preparation.
12.8 Severability.
If
there is a conflict between this Agreement and any present or future Law,
this
Agreement shall be curtailed only to the extent necessary to bring it within
the
requirements of that Law, and the remainder of this Agreement shall remain
in
full force and effect.
12.9 Notices.
All
notices, requests, demands, claims and other communications that are required
or
may be given pursuant to this Agreement must be in writing and delivered
personally (with written receipt) by a reputable international overnight
courier, by telecopy or facsimile or by registered or certified mail (
return
receipt requested and postage prepaid), to the parties at the following
addresses (or to the attention of such other Person or at such other address
as
any party may provide to the other party by notice in accordance with this
subsection):
if
to
Game Financial, to:
Game
Financial Corporation
Attention:
General Manager
11601
Roosevelt Boulevard
St.
Petersburg, Florida 33717-2202
Facsimile:
(727) 556-9051
with
a
copy to (which shall not constitute notice):
Game
Financial Corporation
Attention:
Law Department
11601
Roosevelt Boulevard
St.
Petersburg, Florida 33717-2202
Facsimile:
(727) 556 - 9196
if
to a
Chex Entity to:
Henry
Fong
Chairman
Fast
Funds Financial Corporation
11100
Wayzata Blvd.
Suite
111
Minnetonka,
Minnesota 55305
Facsimile:
(561) 514-9046
with
a
copy to (which shall not constitute notice):
Maslon
Edelman Borman & Brand, LLP
Attention:
William M. Mower, P.A.
3300
Wells Fargo Centre
90
South
Seventh Street
Minneapolis,
Minnesota 55402
Facsimile:
(612) 642-8358
Notices
shall be deemed given on the date of hand delivery, or on the date mailed
(if
mailed), in accordance with the first paragraph of this subsection.
12.10 Time
is of the Essence.
Time is
of the essence with respect to the obligations of the parties under this
Agreement.
12.11 No
Third Party Beneficiary.
This
Agreement is made for the sole benefit of the parties and their respective
successors and permitted assigns, and nothing contained in this Agreement,
express or implied, is intended to or shall confer any third-party beneficiary
right or other legal or equitable right, benefit or remedy upon any Person
that
is not a party (except to the extent that an Affiliate of a Chex Entity
or Game
Financial is expressly identified in this Agreement or is an Indemnified
Party).
12.12 Counterparts.
This
Agreement may be executed in one or more counterparts, including by facsimile,
for the convenience of the parties, and all such counterparts together
will
constitute one and the same original instrument.
12.13 Amendment.
This
Agreement may be modified only by written agreement of the parties.
12.14 No
Successor Liability.
It is
expressly understood that the parties intend that Game Financial shall
not be
considered a successor to any Chex Entity or any of their Affiliates by
reason
of any theory of law or equity, and that Game Financial shall have no Liability
except as otherwise provided in this Agreement for any obligation or liability
of a Chex Entity or their Affiliates.
12.15 Active
Prospect List.
Active
Prospect List.
Schedule
12.15
identifies certain active prospective customers of the Business (the
“Prospects”). If
a
Prospect (i) between the date hereof and Closing, enters into an agreement
to
purchase Business services and if Game Financial approves such agreement
and
agrees to assume it at Closing (in which case such agreements shall be
considered “Assumed Contracts” and “Material Business Contracts” for purposes of
the representations, warranties, covenants, indemnities and other provisions
of
this Agreement), or
(ii)
between Closing and the date six (6) months from Closing, enters into an
agreement with Game Financial to purchase Business services, then
Game
Financial shall pay Chex Fifty Percent (50%) of the net profit earned by
Game
Financial during the initial term of such agreement (without renewals or
extensions) (the “Commission”). “Net profit” means collected revenue less any
and all direct expenses, costs of sale, commissions, costs of cash (adjusted
up
or down to the then-current level - right now it is 6%), amortized capital,
and
a reasonable allocation of fixed overhead. Game Financial shall pay 50%
of the
estimated future Commission expected to be earned during the initial term
of the
agreement (without renewals or extensions)(the "Prepaid Commission") on
the
later of (i) Closing, or (ii) when Game Financial starts providing services
to
such Prospect. Such estimated future Commission shall be calculated based
on the
projections from the client and the use of historical and known costs associated
with sales and processing of the transactions. The remaining 50% of the
Commission shall be calculated and paid quarterly in arrears throughout
the
initial contract term, and there shall be quarterly true ups based on the
difference between the estimated and actual Commission and adjustments
reflecting such differences will be made at that time; in addition, if
contract
terminates early (and if such termination is not the result of Game Financial's
material breach), then the Prepaid Commission for such contract(s) shall
be
retroactively reduced to reflect the new shorter period of time over which
Commissions have been actually earned, and Chex shall promptly pay to Game
Financial the difference between the initially calculated and paid Prepaid
Commission and the Prepaid Commission Chex would have received had it been
initially calculated based on such shorter period of time.
12.16 Isleta
Contract.
Isleta
Contract.
One of
the Assumed Contracts is the November 21, 2002 Financial Services Agreement
between Chex and The Pueblo of Isleta d/b/a Isleta Gaming Palace (the “Isleta
Contract”), and that contract is now on a month-to-month term. “Promptly” for
purposes of this subsection means within five (5) Business
Days.
(i)
If,
prior to Closing, the Chex Entities obtain an extension of the Isleta Contract
for 1 year or more, on terms and conditions pre-approved by Game Financial
in
writing (the “Extended Isleta Contract”) and the Extended Isleta Contract
terminates for any reason during the first 12 months after Closing then
the Chex
Entities shall promptly pay to Game Financial an amount equal to: (i)
$750,000,
times
(ii) a
fraction, the numerator of which is 12 minus the number of months the Extended
Isleta Contract was in place after Closing but prior to termination, and
the
denominator of which is 12. If, however, Isleta terminates the Extended
Isleta
Contract because of Game Financial’s breach, then there would be no payment owed
to Game Financial by the Chex Entities.
(ii)
If
the Extended Isleta Contract is not obtained prior to Closing and Isleta
terminates the Isleta Contract or fails to renew for each of the 12 months
following Closing (i.e., the parties expect the contract to remain in force
for
12 months following Closing), then the Chex Entities shall promptly pay
to Game
Financial $750,000. If Isleta terminates or fails to renew the Isleta Contract
after such 12 month period there would be no payment owed to Game Financial
by
the Chex Entities.
12.17 Survival.
The
representations, warranties and covenants contained in this Agreement,
and in
any document delivered pursuant to this Agreement, shall survive the Closing
and
any investigation made by Game Financial or the Chex Entities. No action
for a
breach or inaccuracy of the representations and warranties made or deemed
made
in this Agreement, or in any document delivered pursuant to this Agreement,
shall be brought more than three (3) years following the Closing Date,
except
for: (i) claims arising out of the representations and warranties contained
in
Subsections
6.1 (Organization), 6.9 (Employee Compensation and Benefit Plans), 6.17
(Taxes),
6.19 (Sufficiency of Assets), 6.20 (Brokers), and 7.1 (Organization) and
7.3
(Brokers)
(“Specified Representations”), which claims may be brought until the expiration
of the applicable statute of limitations; (ii) Indemnified Claims of which
the
Indemnifying Party has been notified by the Indemnified Party within such
three
(3) year period; (iii) claims for material breach of representations or
warranties made by a Chex Entity that were known to be inaccurate at the
Closing
and which were not then disclosed in writing to Game Financial, which claims
shall survive indefinitely; and (iv) claims by Game Financial Indemnified
Parties for indemnification with respect to Ongoing Commission or the litigation
described on Schedule
6.12,
which
shall also survive indefinitely. It is understood that a claim may be made
prior
to such time as the exact amount thereof is determined.
[signature
page follows]
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the Effective
Date.
| |
GAME
FINANCIAL CORPORATION
|
| |
|
|
| |
|
| |
/s/
Renz R. Nichols
|
| |
By:
|
Renz
R. Nichols
|
| |
Title
|
President
|
| |
|
|
| |
CHEX
SERVICES, INC.
|
| |
|
|
| |
|
| |
/s/
Michael S. Casazza |
| |
By:
|
Michael
S. Casazza |
| |
Title:
|
Acting
CEO |
| |
|
|
| |
|
|
| |
FASTFUNDS
FINANCIAL CORPORATION
|
| |
|
|
| |
|
| |
/s/
Michael S. Casazza |
| |
By:
|
Michael
S. Casazza |
| |
Title:
|
Acting
CEO |
44