Exhibit 10.145
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT ("AMENDMENT") dated as
of June 2, 2005, by and among LAKES CALIFORNIA LAND DEVELOPMENT, INC., LAKES
ENTERTAINMENT, INC., LAKES SHINGLE SPRINGS, INC., LAKES JAMUL, INC., LAKES KAR
SHINGLE SPRINGS, L.L.C., LAKES KEAN ARGOVITZ RESORTS-CALIFORNIA, L.L.C. (each an
"Original Secured Party" and collectively, the "Original Secured Parties"),
LAKES PAWNEE CONSULTING, LLC, LAKES PAWNEE MANAGEMENT, LLC, LAKES KICKAPOO
CONSULTING, LLC, LAKES KICKAPOO MANAGEMENT, LLC, LAKES IOWA CONSULTING, LLC,
LAKES IOWA MANAGEMENT, LLC, (each an " Additional Secured Party", collectively
the "Additional Secured Parties" and collectively with the Original Secured
Parties, the "Secured Parties") and XXXXX X. XXXX, a resident of the state of
Nevada (the "Debtor").
RECITALS:
WHEREAS, Debtor and the Original Secured Parties have entered into that
certain Loan and Security Agreement dated as of January 30, 2003 (as amended
from time to time, the "Security Agreement"); capitalized terms used but not
otherwised defined herein shall have the meanings set forth in the Security
Agreement; and
WHEREAS, Debtor, Lakes Pawnee Consulting, LLC and Lakes Pawnee Mangement,
LLC have entered into that certain Consulting Agreement of even date herewith
(as amended from time to time, the "Pawnee Consulting Agreement"); and
WHEREAS, Debtor, Lakes Kickapoo Consulting, LLC and Lakes Kickapoo
Management, LLC have entered into that certain Consulting Agreement of even date
herewith (as amended from time to time, the "Kickapoo Consulting Agreement");
and
WHEREAS, Debtor, Lakes Iowa Consulting, LLC and Lakes Iowa Management, LLC
have entered into that certain Consulting Agreement of even date herewith (as
amended from time to time, the "Iowa Consulting Agreement");
WHEREAS, to induce the Additional Secured Parties to enter into the
above-referenced Pawnee Consulting Agreement, Kickapoo Consulting Agreement and
Iowa Consulting Agreement, as applicable, each of the parties to this First
Amendment have agreed to amend the Security Agreement pursuant to the terms and
conditions contained herein.
AGREEMENTS:
NOW, THEREFORE, in consideration of the foregoing premises and for good and
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree to amend the Security Agreement as follows:
1. Parties. The list of Parties on page one of the Security Agreement is
hereby amended to add the following entities:
LAKES PAWNEE CONSULTING, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
LAKES PAWNEE MANAGEMENT, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
LAKES KICKAPOO CONSULTING, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
LAKES KICKAPOO MANAGEMENT, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
LAKES IOWA CONSULTING, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
LAKES IOWA MANAGEMENT, LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 ("Secured Party")
2. Amendment of Definitions - Loan Documents and Secured Obligations. The
first sentence of Section 2 of the Security Agreement is hereby amended by
inserting the phrase "the Pawnee Consulting Agreement, the Kickapoo Consulting
Agreement and the Iowa Consulting Agreement," immediately following the existing
phrase "each of the KARSS Note and the KAR Note (as respectively defined in the
Buyout Agreements)," as set forth therein in order to specifically include such
consulting agreements within the scope of the term "Loan Documents" as set forth
therein. The term "Loan Documents" is used in the Security Agreement to further
define the term "Secured Obligations" as used therein and accordingly, the
foregoing amendment also has the effect of including the Debtor's obligations
under such consulting agreements within the term Secured Obligations. As used
above and elsewhere in the Security Agreement, the terms "Pawnee Consulting
Agreement," "Kickapoo Consulting Agreement" and "Iowa Consulting Agreement"
shall each have the meanings assigned to such terms in the Recitals to this
First Amendment.
Notwithstanding the foregoing or any contrary term or provision set forth
herein, in the Buyout Agreements or in the Security Agreement, each of the
Secured Parties and Debtor acknowledges and agrees:
(a) that no fees, income or other Rights to Payment owing by a Secured
Party to Debtor under the Pawnee Consulting Agreement, the Kickapoo
Consulting Agreement or
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the Iowa Consulting Agreement (collectively, the "Xxxx Oklahoma/Texas
Fees") shall be applied to the payment of or constitute Collateral for any
Secured Obligations owing by Debtor to any Secured Party under or with
respect to any contracts related to gaming projects with either the Shingle
Springs Band of Miwok Indians or the Jamul Indian Village. Debtor
acknowledges that such limitation shall not apply to Xxxx Residential Loan
Obligations, which obligations shall be secured by the Xxxx Oklahoma/Texas
Fees; and
(b) that an "event of default" by Debtor under the Buyout Agreements
or any "Consulting Agreement" related to the gaming projects with either
the Shingle Springs Band of Miwok Indians or the Jamul Indian Village shall
not constitute an "event of default" under any of the Pawnee Consulting
Agreement, the Kickapoo Consulting Agreement or the Iowa Consulting
Agreement, and conversely, that an "event of default" by Debtor under any
of the Pawnee Consulting Agreement, the Kickapoo Consulting Agreement or
the Iowa Consulting Agreement shall not constitute an "event of default"
under the Buyout Agreements or any "Consulting Agreement" related to the
gaming projects with either the Shingle Springs Band of Miwok Indians or
the Jamul Indian Village; and
(c) that subject to the "50%" limitation set forth in Section 2 of the
Buyout Agreements, the Secured Parties shall have the right to apply any
Shingle Springs/Jamul Fees (as hereinafter defined) to the payment of any
Obligations of Debtor owed to a Secured Party under or with respect to any
of the Pawnee Consulting Agreement, the Kickapoo Consulting Agreement or
the Iowa Consulting Agreement, whether prior to or after the occurrence of
any event of default under the Loan Documents. As used herein, the term
"Shingle Springs/Jamul Fees" shall mean any fees, income or other Rights to
Payment owing by a Secured Party to Debtor under the Buyout Agreements or
any "Consulting Agreement" related to the gaming projects with either the
Shingle Springs Band of Miwok Indians or the Jamul Indian Village .
3. Amendment of Definition - Rights to Payment. Section 2(a)(ii) is hereby
deleted in its entirety and replaced with the following:
(ii) The term "Rights to Payment" shall mean each and all of the
contract rights and rights to payment of the Debtor arising under each of
the Buyout Agreements, the "Consulting Agreements" (as respectively defined
in the Buyout Agreements), the Pawnee Consulting Agreement, the Kickapoo
Consulting Agreement, the Iowa Consulting Agreement and under or arising
from any consulting, broker or other agreement involving (1) either Xxxxx
Xxxx or any affiliate of Xxxx in which he directly or indirectly owns an
ownership interest or is a director, officer, employee or agent, and (2)
any of the "Designated Tribes" (defined below) or with any Secured Party,
together with all substitutions, replacements and amendments thereto, each
whether now existing or hereafter arising.
(iii) The term "Designated Tribes" shall mean any of the following:
Shingle Springs Band of Miwok Indians, Jamul Indian Village, Pawnee Nation
of Oklahoma,
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Iowa Tribe of Oklahoma, Kickapoo Traditional Tribe of Texas, and/or any
instrumentality, subsidiary or other affiliate of any of such tribes.
4. Exclusive Development Rights.
a. Consulting Rights in Favor of Xxxx. Lakes Entertainment, Inc.
("Lakes Entertainment") agrees that so long as any loans and similar
obligations of Debtor to Lakes Entertainment or any of its Affiliates
remain owing and unpaid, Lakes shall grant Debtor the right to be a
consultant to Lakes Entertainment with respect to each gaming project
opportunity pursued by Lakes Entertainment or any of it s Affiliates in the
State of Oklahoma (each an "Oklahoma Gaming Opportunity. Lakes shall
promptly notify Debtor in writing of all Oklahoma Gaming Opportunities.
From the date of receiving such notice, Debtor shall have thirty (30) days
to consider the Oklahoma Gaming Opportunity and notify Lakes Entertainment
whether he intends to accept such consulting engagement. In the event that
Debtor declines such opportunity or fails to respond within such thirty
(30) day period, Lakes Entertainment shall have the right to pursue such
opportunity individually or with any other party. If Debtor shall accept
such consulting engagement, then Debtor and Lakes Entertainment shall enter
into a consulting agreement with respect to such Oklahoma Gaming
Opportunity on substantially the same terms and conditions as set forth in
the Kickapoo Consulting Agreement. Lakes Entertainment shall have the right
to assign its rights and obligations under this Section 5 to one or more of
its subsidiaries.
b. Development Rights in Favor of Lakes. Debtor agrees that so long as
any debts and obligations of Debtor to Lakes Entertainment or any of its
Affiliates remain owing and unpaid, Debtor shall grant Lakes Entertainment
a right of first refusal to pursue or develop any gaming-related business
opportunity made available to Debtor by any party (each a "Business
Opportunity") on the same terms and conditions as offered to Debtor. Debtor
shall promptly notify Lakes Entertainment in writing of all Business
Opportunities together with all material terms and conditions. From the
date of receiving such notice and all material information, Lakes
Entertainment shall have thirty (30) days to consider the Business
Opportunity and notify Debtor whether it intends to pursue the same. In the
event that Lakes Entertainment declines such opportunity, Debtor shall have
the right to pursue such opportunity individually or with any other party
but may not do so on terms and conditions more favorable than those offered
to Lakes Entertainment. If Debtor does not enter into a signed agreement
with such unrelated third party regarding the Business Opportunity which
has been declined by Lakes Entertainment within one (1) year of such
declination, then Lakes' right of first refusal granted herein is
reinstated for that opportunity. If Lakes Entertainment shall pursue the
Business Opportunity, then Debtor shall be entitled to a fee with respect
to such opportunity in an amount and subject to the same terms and
conditions as are set forth in Section 6 of the Kickapoo Consulting
Agreement. Lakes Entertainment shall have the right to assign its rights
and obligations under this Section 5 to one or more of its subsidiaries.
5. Definition of Affiliate. As used in the Security Agreement, the term
"Affiliate" shall mean with respect to any specified person or entity (a
"Person"), any other Person that directly or
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indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with the specified Person; and for the purposes of this
definition, "control" (including the terms controlling, controlled by, or under
common control with) means the possession, direct or indirect, or the power to
direct or cause the direction of the management and policies of a person,
whether through the ownership of voting securities, partnership or member
interests, by contract or otherwise.
6. No Other Changes. Except as explicitly amended by this Amendment, all of
the terms and conditions of the Security Agreement remain in full force and
effect.
7. Representations and Warranties. Except as explicitly amended by this
Amendment, Debtor reaffirms that each of the Representations and Warranties
contained in the Security Agreement is correct on and as of the date hereof as
though made on and as of such date, except to the extent that such
representations and warranties relate solely to an earlier date.
8. Counterparts. This Amendment may be executed in any number of
counterparts and by facsimile, and each such counterpart shall be considered an
original and all of which taken together shall constitute one and the same
instrument.
[The remainder of this page has intentionally been left blank.]
(THE SIGNATURE PAGE FOLLOWS.)
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THE PARTIES have executed this First Amendment to Loan and Security
Agreement as of June 14, 2005.
SECURED PARTIES:
LAKES ENTERTAINMENT, INC. LAKES SHINGLES SPRINGS, INC.
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
LAKES JAMUL, INC. LAKES CALIFORNIA LAND DEVELOPMENT, INC.
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
LAKES KEAN ARGOVITZ RESORTS-CALIFORNIA,
LAKES KAR-SHINGLE SPRINGS, L.L.C. L.L.C.
By: Lakes Shingle Springs, Inc. By: Lakes Shingle Springs, Inc.
Its: Member Its: Member
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
LAKES PAWNEE CONSULTING, LLC LAKES PAWNEE MANAGEMENT, LLC
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
LAKES KICKAPOO CONSULTING, LLC LAKES KICKAPOO MANAGEMENT, LLC
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
LAKES IOWA CONSULTING, LLC LAKES IOWA MANAGMENT, LLC
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
--------------------------------- ------------------------------------
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Its: President Its: President
DEBTOR:
/k/ Xxxxx X. Xxxx
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XXXXX X. XXXX
