VOTING
AGREEMENT
This
VOTING AGREEMENT (the “
Agreement
”), dated as
of November 11, 2009, is made by and between New World Opportunity Partners I,
L.P., a Delaware limited partnership (the “
Stockholder
”), and
Churchill Downs Incorporated, a Kentucky corporation (“
Parent
”). Capitalized
terms used herein but not otherwise defined herein shall have the meanings
ascribed to such terms in the Merger Agreement (as defined below).
WHEREAS,
concurrently herewith, Parent, Tomahawk Merger Corp., a Delaware corporation and
a wholly owned subsidiary of Parent (“
Merger Sub
”),
Tomahawk Merger LLC, a single member Delaware limited liability company and
wholly owned subsidiary of Parent (“
Merger LLC
”) and
Youbet.com, Inc., a Delaware corporation (the “
Company
”), are
entering into an Agreement and Plan of Merger, dated as of the date hereof (for
purposes of this definition, substantially in the form provided to the
Stockholder prior to the Stockholder’s execution hereof and as may hereafter be
amended in a manner not materially adverse to the Stockholder (provided that any
reduction in the Exchange Ratio or reduction in the Per Share Cash Consideration
payable in the Merger to the Stockholder shall be deemed an amendment materially
adverse to the Stockholder), the “
Merger Agreement
”),
providing for the merger of Merger Sub with and into the Company, with the
Company continuing as the Surviving Corporation, and as soon as reasonably
practicable thereafter, the Surviving Corporation will merge with and into
Merger LLC, upon the terms and subject to the conditions set forth in the Merger
Agreement (the “
Merger
”);
WHEREAS,
as of the date hereof, the Stockholder owns, beneficially or of record, or has
complete investment authority over, and has (or upon exercise or exchange of a
convertible security will have), except as set forth on
Schedule A
hereto,
the power to vote and dispose of the number of shares of Company Common Stock
set forth on
Schedule
A
hereto (the “
Owned Shares
” and,
together with any securities issued or exchanged with respect to such shares of
Company Common Stock during the term of this Agreement upon any
recapitalization, reclassification, merger, consolidation, spin-off, partial or
complete liquidation, stock dividend, split-up or combination of the securities
of the Company or any other change in the Company’s capital structure or
securities of which such Stockholder acquires beneficial or record ownership
after the date hereof and prior to the termination hereof, whether by purchase,
acquisition or upon exercise of options, warrants, conversion of other
convertible securities or otherwise, collectively referred to herein as, the
“
Covered
Shares
”); and
WHEREAS,
as a condition to the willingness of Parent to enter into the Merger Agreement,
Parent has required that the Stockholder agree, and in order to induce Parent to
enter into the Merger Agreement, the Stockholder has agreed, to enter into this
Agreement with respect to the Covered Shares and certain other matters as set
forth herein.
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements contained herein, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:
ARTICLE I.
VOTING
AGREEMENT
Section 1.1
Voting
Agreement
. The
Stockholder hereby irrevocably and unconditionally covenants and agrees that
during the Voting Period (as defined below), at any meeting of the stockholders
of the Company (whether annual or special), however called, or at any
adjournment or postponement thereof or in any other circumstances (including an
action by written consent) upon which a vote or other approval is sought with
respect to any of the matters referred to in clause (ii) below, the Stockholder
shall (i) when a meeting is held, appear at such meeting or otherwise cause the
Covered Shares as to which the Stockholder controls the right to vote to be
counted as present thereat for the purpose of establishing a quorum, and (ii)
vote (or cause to be voted) in person or by proxy the Covered Shares as to which
the Stockholder controls the right to vote (A) in favor of the adoption of the
Merger Agreement and the transactions contemplated by the Merger Agreement, (B)
in favor of the approval of any other matter to be approved by the stockholders
of the Company in connection with the Merger, the adoption of the Merger
Agreement and the transactions contemplated by the Merger Agreement, (C) against
any extraordinary corporate transaction (other than the Merger), such as a
merger, consolidation, business combination, tender or exchange offer,
reorganization, recapitalization, liquidation, sale or transfer of all or
substantially all of the assets or securities of the Company and any of its
subsidiaries (other than pursuant to the Merger) or any other Alternative
Transaction, (D) against any amendment of the Company’s certificate of
incorporation or by-laws other than as permitted by the Merger Agreement, (E) in
a manner that is not inconsistent with the publicly stated position or
recommendation of Parent (but only to the extent Parent publicly states a
position or recommendation) with respect to any other proposal, action or
transaction involving the Company or any of its Subsidiaries, which amendment or
other proposal, action or transaction would reasonably be expected to in any
manner impede, frustrate, prevent or nullify the Merger Agreement, the Company
Stockholder Approval, the Merger or any of the other transactions contemplated
by the Merger Agreement or change in any manner the voting rights of any class
of the Company’s capital stock, and (F) against any extraordinary dividend,
distribution or recapitalization by the Company or change in the capital
structure of the Company (other than pursuant to or as permitted by the Merger
Agreement). For the purposes of this Agreement, “
Voting
Period
” shall mean the
period commencing on the date hereof and ending immediately prior to any
termination of this Agreement in accordance with its terms pursuant to
Section 5.1 hereof. The Stockholder further agrees not to commit
or agree to take any action inconsistent with the foregoing.
Section 1.2
Grant of
Proxy
. In order
to secure the performance of Stockholder’s obligations under this Agreement, the
Stockholder hereby revokes any and all previous proxies granted with respect to
the Covered Shares and irrevocably grants to, and appoints, Parent and each
executive officer of Parent, and any other individual designated in writing by
Parent, as such Stockholder’s proxy and attorney-in-fact (with full power of
substitution), for and in its name, place and stead, to be counted as present,
vote, express consent or dissent or otherwise to act on behalf of such
Stockholder with respect to the Covered Shares in the manner contemplated by
Section 1.1 during the Voting Period. The Stockholder understands and
acknowledges that Parent is entering into the Merger Agreement in reliance upon
the Stockholder’s execution and delivery of this Agreement. The
Stockholder hereby affirms that the irrevocable proxy set forth in this Section
1.2 is given in connection with the execution of the Merger Agreement, and that
such irrevocable proxy is given to secure the performance of the duties of the
Stockholder under this Agreement. Except as provided for in the last
sentence of this Section 1.2, the Stockholder hereby (i) affirms that the
irrevocable proxy is coupled with an interest and may under no circumstances be
revoked and (ii) ratifies and confirms all that the proxies appointed
hereunder may lawfully do or cause to be done by virtue
hereof. Notwithstanding any other provisions of this Agreement, the
irrevocable proxy granted hereunder shall automatically terminate upon the
termination of this Agreement without any notice or other action by any
person.
Section 1.3
Waiver of
Appraisal Rights
. The Stockholder hereby
irrevocably and unconditionally waives, and agrees not to assert or perfect, any
rights of appraisal, dissenters’ rights or similar rights that such Stockholder
may have in connection with the Merger.
ARTICLE II.
REPRESENTATIONS
AND WARRANTIES OF PARENT
Parent
hereby represents and warrants to each Stockholder as follows:
Section 2.1
Valid
Existence
. Parent is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Kentucky and has the requisite corporate power and authority to carry
on its business as it is now being conducted.
Section 2.2
Authority
Relative to This Agreement
. Parent has all necessary
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. This Agreement has been duly and validly authorized, executed
and delivered by Parent and, assuming the due execution and delivery by the
Stockholder, constitutes a legal, valid and binding obligation of Parent,
enforceable against Parent in accordance with its terms, except as enforcement
may be limited by bankruptcy, insolvency, moratorium or other similar laws
relating to creditors rights generally and by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
Section 2.3
No
Conflicts
.
(a)
The execution and delivery of this
Agreement by Parent does not, and the performance of Parent’s obligations under
this Agreement and the consummation by Parent of the transactions contemplated
hereby will not, (i) conflict with or violate any law, rule, regulation, order,
judgment or decree applicable to Parent or any of Parent’s properties or assets,
(ii) contravene or conflict with the articles of incorporation or the bylaws of
Parent or (iii) result in any violation or the breach of, or constitute a
default under, or give rise to any right of termination, cancellation or
acceleration or any payments under, or result in a loss of a benefit or in the
creation or imposition of an Encumbrance under, any of the terms, conditions or
provisions of any contract, note, lease, mortgage, indenture, license or other
instrument to which Parent is a party, except for conflicts, violations,
breaches or defaults that would not impair the ability of Parent to perform its
obligations hereunder or prevent or delay the consummation of the transactions
contemplated by this Agreement.
(b)
Except for the applicable requirements
of the Exchange Act, no filing or notification with, and no permit,
authorization, consent or approval of, any Governmental Entity is necessary on
the part of Parent for the execution and delivery of this Agreement by Parent
and the consummation by Parent of the transactions contemplated hereby, except
where the failure to obtain such permits, authorizations, consents or approvals,
or to make such filings or notifications, would not impair the ability of Parent
to perform its obligations hereunder.
ARTICLE III.
REPRESENTATIONS
AND WARRANTIES
OF THE
STOCKHOLDER
The
Stockholder hereby represents and warrants to Parent as follows:
Section 3.1
Authority
Relative To This Agreement
. If the Stockholder is a
natural person, the Stockholder has the capacity to execute and deliver this
Agreement, to perform the Stockholder’s obligations hereunder and to consummate
the transactions contemplated hereby. If the Stockholder is other
than a natural person, the Stockholder (a) is duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization and (b)
has all necessary organizational power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. This Agreement has been duly and
validly executed and delivered by the Stockholder and, assuming the due
authorization, execution and delivery by Parent, constitutes a legal, valid and
binding obligation of the Stockholder, enforceable against such Stockholder in
accordance with its terms, except as enforcement may be limited by bankruptcy,
insolvency, moratorium or other similar laws relating to creditors rights
generally and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
Section 3.2
No
Conflicts
.
(a)
The execution and delivery of this
Agreement by the Stockholder do not, and the performance of the Stockholder’s
obligations under this Agreement and the consummation by the Stockholder of the
transactions contemplated hereby will not, (i) conflict with or violate any law,
rule, regulation, order, judgment or decree applicable to the Stockholder, the
Covered Shares or any of the Stockholder’s properties or assets, (ii) if such
Stockholder is other than a natural person, contravene or conflict with the
certificate of incorporation or the bylaws or other organizational documents of
such Stockholder or (iii) result in any violation or the breach of, or
constitute a default under, or give rise to any right of termination,
cancellation or acceleration or any payments under, or result in a loss of a
benefit or in the creation or imposition of an Encumbrance under, any of the
terms, conditions or provisions of any contract, note, lease, mortgage,
indenture, license or other instrument to which the Stockholder is a party,
except for conflicts, violations, breaches or defaults that would not impair the
ability of the Stockholder to perform such Stockholder’s obligations hereunder
or prevent or delay the consummation of the transactions contemplated by this
Agreement.
(b)
Except for the applicable requirements
of the Exchange Act, no filing or notification with, and no permit,
authorization, consent or approval of, any Governmental Entity is necessary on
the part of the Stockholder for the execution and delivery of this Agreement,
except where the failure to obtain such permits, authorizations, consents or
approvals, or to make such filings or notifications, would not impair the
ability of such Stockholder to perform such Stockholder’s obligations
hereunder.
Section 3.3
Ownership Of
Shares
. As of
the date hereof, except as set forth in
Schedule
A
hereto, the Stockholder
has good and valid and marketable title to and is the record or beneficial owner
of the Owned Shares set forth opposite the Stockholder’s name on
Schedule
A
hereto free and clear of
all pledges, liens, proxies, claims, charges, security interests, preemptive
rights, voting trusts, voting agreements, options, rights of first offer or
refusal and any other encumbrances, restrictions or arrangements whatsoever with
respect to the ownership, transfer or other voting of the Owned
Shares. Except as set forth in
Schedule
A
hereto, the Stockholder
has full and unrestricted power to dispose of and vote all of, and has not
granted any proxy inconsistent with this Agreement that is still effective with
respect to, the Owned Shares. The Stockholder does not own,
beneficially or of record, any shares of capital stock of the Company or
securities convertible into or exercisable or exchangeable for shares of capital
stock of the Company, other than the Covered Shares. As of the date
hereof, no proceedings are pending which, if adversely determined, will have a
material adverse effect on any ability to vote or dispose of any of the Covered
Shares.
Section 3.4
Stockholder
Has Adequate Information
. The Stockholder is a
sophisticated investor with respect to the Covered Shares and has independently
and without reliance upon Parent and based on such information as the
Stockholder has deemed appropriate, made such Stockholder’s own analysis and
decision to enter into this Agreement. The Stockholder acknowledges
that Parent has not made nor makes to the Stockholder any representation or
warranty, whether express or implied, of any kind or character in connection
with this Agreement except as expressly set forth in this
Agreement.
Section 3.5
No
Setoff
. To the
knowledge of the Stockholder, there are no legal or equitable defenses or
counterclaims that have been or may be asserted by or on behalf of the Company,
as applicable, to reduce the amount of the Covered Shares or affect the validity
or enforceability of this Agreement.
Section 3.6
Finder’s
Fees
. Except as
disclosed pursuant to the Merger Agreement, no investment banker, broker, finder
or other intermediary is entitled to a fee or commission from Parent, Merger Sub
or the Company in respect of this Agreement based upon any arrangement or
agreement made by or on behalf of the Stockholder.
Section 3.7
No Other
Representations or Warranties
.
Except for the
representations and warranties expressly contained in this Article III, the
Stockholder makes no express or implied representation or warranty with respect
to such Stockholder, the Covered Shares, or otherwise.
ARTICLE IV.
COVENANTS OF
THE STOCKHOLDER
The
Stockholder hereby covenants and agrees as follows:
Section 4.1
No
Transfer
.
(a)
Other than pursuant to the terms of this
Agreement or the Merger Agreement, without the prior written consent of Parent
or as otherwise provided in this Agreement, during the term of this Agreement,
the Stockholder hereby agrees to not, directly or indirectly, (i) grant any
proxies, options, rights of first offer or refusal or power of attorney or enter
into any voting trust or other agreement or arrangement with respect to, or
restricting the voting of, any Covered Shares, (ii) enter into a swap or any
other agreement or any transaction that transfers, in whole or in part, the
economic consequence of ownership of any Covered Shares or (iii) sell, pledge,
assign, transfer, tender, exchange, offer, encumber or otherwise dispose of
(including by merger or consolidation), or enter into any contract, option or
other arrangement or understanding with respect to the direct or indirect
assignment, transfer, tender, exchange, offer, encumbrance or other disposition
of (including by merger or consolidation) (each, a “
Transfer
”), any Covered Shares. Any
action taken or attempted to be taken in violation of the preceding sentence
will be null and void. The Stockholder further agrees to authorize
and request Parent and the Company to notify the Company’s transfer agent that
there is a stop transfer order consistent herewith with respect to the Covered
Shares and that this Agreement places limits on the voting of the Covered
Shares. Notwithstanding the foregoing or anything to the contrary set
forth in this Agreement, the Stockholder may Transfer any or all of the Covered
Shares (i) by will, or by operation of law, in which case this Agreement shall,
to the extent permitted by Law, bind the transferee, or (ii) to affiliates,
trusts and charitable organizations, so long as the transferee, prior to such
Transfer executes a counterpart of this Agreement (with such modifications as
Parent may reasonably request solely to reflect such Transfer) and agrees to be
bound by its terms.
(b)
The Stockholder hereby covenants and
agrees that for a period of 90 days following the Effective Time (the
“
Lock-Up
Period
”), such Stockholder
shall not Transfer or consent to any Transfer of, any shares of Parent Common
Stock received by such Stockholder in the Merger with respect to the Covered
Shares, or any interest therein, or enter into any contract, option or other
arrangement or understanding with respect to the direct or indirect Transfer of,
any shares of Parent Common Stock received by such Stockholder in the Merger
with respect to the Covered Shares or any interest therein to any Person (other
than Parent);
provided
,
however
, that the Stockholder may participate
during the Lock-Up Period with respect to its shares of Parent Common Stock in
any merger, tender offer or other business combination or other transaction, in
each case, which the Board of Directors of Parent has recommended to Parent’s
stockholders;
provided
,
further
, that after the Effective Time and
during the Lock-Up Period, the Stockholder may Transfer any or all of the shares
of Parent Common Stock received by such Stockholder in the Merger with respect
to the Covered Shares (i) by will, or by operation of law, in which case this
Section
4.1(b)
shall, to the extent
permitted by Law, bind the transferee until the expiration of the Lock-Up
Period, or (ii) to affiliates, trusts and charitable organizations, so long as
the transferee, prior to such Transfer executes a counterpart of this Agreement
(with such modifications as Parent may reasonably request solely to reflect such
Transfer) and agrees to be bound by its terms (including this
Section
4.1(b)
). The
Stockholder hereby agrees that, in order to ensure compliance with the
restrictions referred to herein, Parent may issue appropriate stop transfer
instructions to its transfer agent in respect of the Stockholder’s Parent Common
Stock. Parent agrees that it will cause any stop transfer
instructions imposed pursuant to this
Section
4.1(b)
to be lifted, and
any legended certificates of Parent Common Stock delivered to the Stockholder
pursuant to the Merger Agreement to be replaced with certificates not bearing
such legend, promptly following the termination of the Lock-Up Period. The
restrictions on transfer provided in this
Section
4.1(b)
shall be in addition
to any restrictions on transfer of the Parent Common Stock imposed by any
applicable Laws.
Section 4.2
Public
Announcement
. The Stockholder shall
consult with Parent before issuing any press releases or otherwise making any
public statements with respect to the transactions contemplated herein, in such
Stockholder’s capacity as a stockholder of the Company, except as may be
required by applicable Law. The Stockholder hereby consents to
disclosure in the Registration Statement and the Proxy Statement (including all
documents and schedules filed with the SEC) and press releases with respect to
the Merger in accordance with the Merger Agreement, of the identity of the
Stockholder and ownership of the Covered Shares and the nature of such
Stockholder’s commitments, arrangements and understandings pursuant to this
Agreement.
Section 4.3
Additional
Shares
. The
Stockholder shall promptly notify Parent of the number of any new Covered Shares
acquired by the Stockholder, if any, after the date hereof. Any such
shares shall be automatically subject to the terms of this Agreement as though
owned by the Stockholder on the date hereof.
Section 4.4
No Restraint
on Officer or Director Action; Etc
. Notwithstanding anything to
the contrary herein, Parent hereby acknowledges and agrees that no provision in
this Agreement shall limit or otherwise restrict the Stockholder with respect to
any act or omission that the Stockholder may undertake or authorize in such
Stockholder’s capacity as a director or officer of the Company or any subsidiary
thereof, including any vote that such individual may make as a director of the
Company with respect to any matter presented to the Company’s board of
directors. The Stockholder has executed this Agreement solely in such
Stockholder’s capacity as the record and/or beneficial owner of the Covered
Shares and no action taken by the Stockholder in such Stockholder’s capacity as
a director or officer of the Company or any subsidiary thereof shall be deemed
to constitute a breach of any provision of this Agreement.
Section 4.5
Other
Obligations
. From and after the date of
this Agreement until the termination hereof in accordance with its terms
pursuant to Section 5.1 hereof, the Stockholder agrees (a) not to, and to cause
any investment banker, attorney or other advisor or representative of such
Stockholder not to, directly or indirectly, solicit, initiate, knowingly
encourage or facilitate, or furnish or disclose non-public information relating
to the Company in furtherance of, any inquiries or the making of any Alternative
Proposal, or negotiate, explore or otherwise engage in discussions with any
Person with respect to any Alternative Transaction, or approve, endorse or
recommend any Alternative Transaction, or enter into any agreement, arrangement
or understanding with respect to any Alternative Transaction and (b) not to take
any action which makes, or would reasonably be expected to make, any
representation or warranty of such Stockholder herein untrue or incorrect in a
material respect. The Stockholder shall notify Parent promptly of any
such inquiries, proposals or offers received by, or any such discussions or
negotiations sought to be initiated or continued with, the Stockholder or, to
the Stockholder’s knowledge, any of its representatives, indicating the name of
such Person and providing to Parent a summary of the material terms of such
proposal or offer for an Alternative Transaction. Notwithstanding the
foregoing, the Stockholder shall be permitted to engage in discussions or
negotiations with, or furnish or disclose non-public information relating to the
Company to, any Person or group of related Persons that has made an Alternative
Proposal if, and only to the extent that, the Company is permitted under Section
4.3(b) of the Merger Agreement to engage in discussions or negotiations with, or
to furnish or disclose non-public information to, such Person or group of
related Persons.
ARTICLE V.
MISCELLANEOUS
Section 5.1
Termination
. This Agreement and all of
its provisions shall terminate upon the earlier of (i) the Effective Time, (ii)
the termination of the Merger Agreement in accordance with its terms, (iii)
written notice of termination of this Agreement by Parent to the Stockholder or
(iv) any amendment or modification to the Merger Agreement that results in a
reduction in the Exchange Ratio or a reduction in the Per Share Cash
Consideration or any other amendment or modification of the Merger Agreement
that is in any manner materially adverse to the Stockholder (such date of
termination, the “
Termination
Date
”), except that the
provisions of
Section
4.1(b)
and
Article
V
shall survive any such
termination of this Agreement;
provided
, that no such termination shall relieve
any party of liability for a willful breach hereof prior to
termination.
Section 5.2
Survival of
Representations and Warranties
. The respective
representations and warranties of the Stockholder and Parent contained herein
shall not be deemed waived or otherwise affected by any investigation made by
the other party hereto. The representations and warranties contained
herein shall expire with, and be terminated and extinguished upon, consummation
of the Merger or termination of this Agreement pursuant to Section 5.1, and
thereafter no party hereto shall be under any liability whatsoever with respect
to any such representation or warranty.
Section 5.3
Fees And
Expenses
. Except
as otherwise provided herein or as set forth in the Merger Agreement, all costs
and expenses incurred in connection with the transactions contemplated by this
Agreement shall be paid by the party incurring such costs and
expenses.
Section 5.4
Notices
. All notices and other
communications hereunder shall be in writing and shall be deemed given when
delivered personally, one day after being delivered to a nationally recognized
overnight courier or on the business day received (or the next business day if
received after 5 p.m. local time or on a weekend or day on which banks are
closed) when sent via facsimile (with a confirmatory copy sent by overnight
courier) to the parties at the following addresses (or at such other address for
a party as shall be specified by like notice):
if to
Parent:
Churchill
Downs Incorporated
700
Central Avenue
Louisville,
Kentucky 40208
Telecopy:
(502) 636-4548
Attention:
General Counsel
with
copies to:
Sidley
Austin LLP
One South
Dearborn
Chicago,
Illinois 60603
Telecopy: (312)
853-7036
|
|
Attention:
|
Brian
J. Fahrney
|
Matthew
G. McQueen
if to the
Stockholder:
At the
address and facsimile number, and with copies, as set forth on
Schedule A
hereto.
Additionally,
any notice delivered to any party hereto shall also be given to the Company in
accordance with this Section 5.4 at:
Youbet.com,
Inc.
2600 West
Olive Avenue, 5th Floor
Burbank,
CA 91505
Telecopy: (818)
668-2101
Attention:
General Counsel
with
copies to:
Kirkland
& Ellis LLP
300 North
LaSalle Street
Chicago,
Illinois 60654
Telecopy: (312)
862-2200
|
|
Attention:
|
Jon
A. Ballis, P.C.
|
James S.
Rowe
Theodore
A. Peto
Section 5.5
Severability
. If any term or other
provision of this Agreement is invalid, illegal or incapable of being enforced
by any rule of law or public policy, all other terms, conditions and provisions
of this Agreement shall nevertheless remain in full force and effect so long as
the economic and legal substance of the transactions contemplated hereby are not
affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the transactions
contemplated by this Agreement may be consummated as originally contemplated to
the fullest extent possible.
Section 5.6
Entire
Agreement; Assignment
. This Agreement constitutes
the entire agreement among the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and undertakings, both written and
oral, among the parties hereto, or any of them, with respect to the subject
matter hereof. This Agreement shall not be assigned (whether pursuant
to a merger, by operation of law or otherwise) without the prior written consent
of the other party, except that Parent may assign all or any of its rights and
obligations hereunder to an affiliate;
provided
,
however
, that no such assignment shall relieve
the assigning party of its obligations hereunder if such assignee does not
perform such obligations.
Section 5.7
Amendment
. This Agreement may be
amended by the parties at any time prior to the Effective Time. This
Agreement may not be amended except by an instrument in writing signed by each
of the parties hereto.
Section 5.8
Waiver
. At any time prior to the
Effective Time, the parties hereto may (i) extend the time for the performance
of any of the obligations or other acts of the other parties hereto, (ii) waive
any inaccuracies in the representations and warranties contained herein or in
any document delivered pursuant hereto and/or (iii) waive compliance with any of
the covenants, agreements or conditions contained herein which may legally be
waived. Any agreement on the part of a party hereto to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party.
Section 5.9
Parties in
Interest
. This
Agreement shall be binding upon and inure solely to the benefit of each party
hereto, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement. However, if after
the execution hereof and before the Termination Date the Stockholder should die
or become incapacitated, this Agreement shall be binding on the Stockholder’s
estate or other legal representative.
Section 5.10
Governing
Law
. This
Agreement shall be governed by and co
n
strued in accordance with the laws of
the State of Delaware, without giving effect to any choice or conflict of law
provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Delaware.
Section 5.11
Specific
Performance; Submission To Jurisdiction
.
(a)
The parties agree that irreparable
da
m
age would occur if any of the provisions
of this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that each of the
parties shall be entitled (in addition to any other remedy that may be available
to it, including monetary damages) to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement exclusively in the Delaware Court of Chancery and any state
appellate court therefrom within the State of Delaware (or, if the Delaware
Court of Chancery declines to accept jurisdiction over a particular matter, any
state and federal courts located within the State of Delaware). The
parties further agree that no party to this Agreement shall be required to
obtain, furnish or post any bond or similar instrument in connection with or as
a condition to obtaining any remedy referred to in this Section 5.11 and each
party waives any objection to the imposition of such relief or any right it may
have to require the obtaining, furnishing or posting of any such bond or similar
instrument. In addition, each of the parties irrevocably agrees that
any legal a
c
tion or proceeding with respect to this
Agreement and the rights and obligations arising her
e
under, or for recognition and
enforcement of any judgment in respect of this Agreement and the rights and
obligations arising hereunder brought by the other party hereto or its
successors or a
s
signs, shall be brought and determined
exclusively in the Delaware Court of Chancery and any state appellate court
therefrom within the State of Delaware (or, if the Delaware Court of Chancery
declines to accept jurisdiction over a particular matter, any state and federal
courts located within the State of Delaware). Each of the parties
hereby irrevocably submits with regard to any such action or proceeding for
itself and in respect of its property, generally and unconditionally, to the
personal jurisdiction of the aforesaid courts and agrees that it will not bring
any action r
e
lating to this Agreement or any of the
transactions co
n
templated by this Agreement in any court
other than the aforesaid courts. Each of the parties hereby
irrevocably waives, and agrees not to assert, by way of motion, as a defense,
counterclaim or otherwise, in any action or pr
o
ceeding with respect to this Agreement,
(i) any claim that it is not personally subject to the juri
s
diction of the above named courts for
any reason other than the failure to serve in accordance with this Section 5.11,
(ii) any claim that it or its property is exempt or immune from jurisdiction of
any such court or from any legal process commenced in such courts (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise) and (iii) to the
fullest extent pe
r
mitted by the applicable Law, any claim
that (A) the suit, action or proceeding in such court is brought in an
inconvenient forum, (B) the venue of such suit, action or proceeding is improper
or (C) this Agreement, or the subject matter hereof, may not be enforced in or
by such courts. Parent and the Stockholder hereby consent to service
being made through the notice procedures set forth in Section 5.4 and agree that
service of any process, summons, notice or document by registered mail (return
receipt requested and first-class postage prepaid) to the respective addresses
set forth in Section 5.4 shall be effective service of process for any suit or
proceeding in connection with this Agreement or the transactions contemplated by
this Agreement.
(b)
EACH PARTY ACKNOWLEDGES AND AGREES THAT
ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, (ii) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS
WAIVER, (iii) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH PARTY HAS
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.11(b).
Section 5.12
Other Voting
Agreements
. Parent represents and
warrants to the Stockholder that each of the voting agreements that Parent is
entering into with each of the Company’s directors (the “
Company
Director Voting Agreements
”) and other stockholders of the Company
in connection with the Merger Agreement (collectively with the Company Director
Voting Agreements, the “
Other Voting
Agreements
”) are
substantially in the form of this Agreement, with the exception of (i) Section
4.5, which is not included in the Company Director Voting Agreements, (ii) the
information set forth on Schedule A of each of the Other Voting Agreements, and
(iii) the third recital and penultimate sentence of Section 1.1 of the Voting
Agreement between Parent and Lloyd I. Miller, III (the “
Miller
Voting Agreement
”), each of
which is not included in this Agreement or any of the Other Voting Agreements
(other than the Miller Voting Agreement). Parent further agrees that
it will not make any amendment or modification to, or waive any provision of,
any of the Other Voting Agreements without offering to also make such amendment,
modification or waiver to this Agreement.
Section 5.13
Interpretation
. Headings of the Articles
and Sections of this Agreement are for convenience of the parties only and shall
be given no substantive or interpretive effect whatsoever. The
language used in this Agreement shall be deemed to be the language chosen by the
parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any party. Whenever
the words “include,”
“includes” or “including” are used in this Agreement, they shall be deemed to be
followed by the words “without limitation.”
Section 5.14
Counterparts
. This Agreement may be
executed in counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other parties (which may be
effected by facsimile or other electronic transmission).
Section 5.15
Further
Assurances
. From
time to time, at the request of another party and without further consideration,
each party hereto shall take such reasonable further action as may be reasonably
necessary to confirm and assure the rights and obligations set forth in this
Agreement or to consummate and make effective the transactions contemplated by
this Agreement.
[
SIGNATURE PAGE
FOLLOWS
]
IN
WITNESS WHEREOF, Parent and the Stockholder have caused this Agreement to be
duly executed on the date hereof.
CHURCHILL
DOWNS INCORPORATED
By:
/s/ William
Carstanjen
Name:
William
Carstanjen
Title:
Chief Operating Officer
NEW WORLD
OPPORTUNITY PARTNERS I, L.P.
By: New
World Venture Advisors, LLC
Title:
General Partner
By:
/s/ Jay R.
Pritzker
Name: Jay
R. Pritzker
Title:
Manager
Schedule
A
|
Name
and Contact
Information for Stockholder
|
Shares
of Common Stock
|
Securities
Convertible or Exercisable or Exchangeable for Common
Stock
|
|
New
World Opportunity Partners I, L.P., a Delaware limited
partnership
1603
Orrington Avenue
Suite
1600
Evanston,
IL 60201
Telecopy:
(847) 328-8297
Attention:
Michael Brodsky
with
copies to:
Katten
Muchin Rosenman LLP
525
West Monroe Street
Chicago,
IL 60661
(312)
577-8858
Attention:
Mark D. Wood
|
5,302,347
|
0
|
Pursuant
to Section 3.3, please note below any exceptions to title over the Owned Shares,
including pledges, liens, proxies, claims, charges, security interests,
preemptive rights, voting trusts, voting agreements, options, rights of first
offer or refusal and any other encumbrances or arrangements whatsoever with
respect to the ownership, transfer or other voting of the Owned
Shares:
None.