Exhibit 10.8
OPERATING AGREEMENT
of
XXXXXXXXXX HARBOR PARKING ASSOCIATES, LLC
THIS OPERATING AGREEMENT (the "Agreement") is made as of the 29th day of
September, 2000, by and between XXXXX INDIANA, INC., a Delaware corporation
having an office at Xxx Xxxxxxxxxx Xxxxxx Xxxxx, Xxxx, Xxxxxxx 00000
(hereinafter sometimes referred to as "Xxxxx"), and AMB PARKING, LLC, a Delaware
limited liability company having an office at Suite 2400, 000 Xxxxxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 (hereinafter sometimes referred to as "Xxxxxx";
Xxxxx and Xxxxxx are hereinafter sometimes referred to as the "Members" and
individually as a "Member").
WITNESSETH:
WHEREAS, Xxxxx and The Majestic Star Casino, LLC, an affiliate of Xxxxxx
("Majestic"), have formed Xxxxxxxxxx Harbor Riverboats, L.L.C., a Delaware
limited liability company ("BHR"), for the purpose of operating and maintaining
certain common areas ancillary to which each of Xxxxx and Majestic conduct
separate riverboat gaming operations; and
WHEREAS, Xxxxx and Xxxxxx desire to form a new limited liability company
for the purpose of acquiring certain real property and constructing a
multi-level parking garage thereon to service the customers of BHR, Xxxxx and
Majestic.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein contained and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. DEFINITIONS. As used in this Agreement, the following terms shall have
the meanings set forth below:
1.1 "Act" means the Delaware Limited Liability Company Act, as amended
from time to time.
1.2 "Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such Person. For
purposes of this definition, "control" shall mean the power to direct management
or policies through ownership of voting securities or similar equity interest.
1.3 "Agreement" means this Operating Agreement, as the same from time to
time may be amended, modified, supplemented or restated.
1.4 "Bankruptcy" means, with respect to the applicable Person, that such
Person shall have (1) made an assignment for the benefit of creditors; (2) filed
a voluntary petition in bankruptcy; (3) been adjudicated bankrupt or insolvent;
(4) filed a petition or answer seeking for himself or itself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any statute, law or regulation; (S) filed an answer or other
pleading admitting or failing to contest the material allegations of a petition
filed against him or it in any proceeding set forth in (4) above; or (6) sought,
consented to, or acquiesced in the appointment of a trustee, receiver, or
liquidator of all or any substantial part of his or its properties; or if 180
days after the commencement of any proceeding against tile Person seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law, or regulation, the proceeding has not
been dismissed, or if within 150 days after the appointment without his or its
consent or acquiescence of a trustee, receiver, or liquidator of the Person or
all or any substantial part of his or its properties, the appointment is not
vacated or stayed, or within 90 days after the expiration of any such stay, the
appointment is not vacated.
1.5 "Capital Account" shall have the meaning ascribed to it in Section
4.1 (c) below.
1.6 "Cash Needs of the LLC" shall have the meaning ascribed to it in
Section 4.3(a)(3) below.
1.7 "Certificate" means the Certificate of Formation filed or to be
filed with respect to the LLC in the office of the Delaware Secretary of State,
as the same may be from time to time amended, modified or supplemented in
accordance with the provisions of this Agreement.
1.8 "City" means the City of Gary, Indiana.
1.9 "Code" the Internal Revenue Code of 1986, as amended, or any
corresponding provision of any succeeding law.
1.10 "Commission" means the Indiana Gaming Commission.
1.11 "Construction Committee" shall have the meaning ascribed to it in
Section 3.1 (b) below.
1.12 "Event of Default" shall have the meaning ascribed to it in Section
7.1 (a) below.
1.13 "Improvements Budget" means the construction budget for the
construction of the Site Plan Improvements attached hereto as Exhibit A, as the
same may be modified from time to time in accordance with this Agreement.
1.14 "Lease" shall have the meaning ascribed to it in Section 2.3(g)
below.
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1.15 "LLC" means the limited liability company to which this Agreement
pertains, as such limited liability company may from time to time be
constituted.
1.16 "LLC Property" means that certain real property located in
Xxxxxxxxxx Harbor, Gary, Indiana more particularly described on Exhibit B,
together with all interests appurtenant thereto, and all additional real
property interests which the LLC acquires or leases, and all improvements
located or constructed thereon, less any part of the foregoing which is
exchanged or otherwise disposed of by the LLC.
1.17 "Member" means any Person who is admitted to the LLC pursuant to
the provisions of this Agreement. The initial Members of the LLC are Xxxxx and
Xxxxxx.
1.18 "Operating Committee" shall have the meaning ascribed to it in
Section 3.2(a) below.
1.19 "Operating Plan and Budget" shall have the meaning ascribed to it
in Section 3.9(a) below.
1.20 "Operating Reserve" means a reserve to be maintained by the LLC
(initially to be funded as part of the Improvements Budget and thereafter to be
reflected in each year's Operating Plan and Budget and funded under the Lease)
equal to one-half of the projected funds (net of anticipated revenues other than
borrowings) required by the LLC in connection with its operations for the
applicable year, but excluding any funds required for construction of the Site
Plan Improvements.
1.21 "Percentage Interest" shall have the meaning ascribed to it in
Section 4.2 below.
1.22 "Person" means any individual, corporation, partnership (general or
limited), association, limited liability company, trust, estate or other entity.
1.23 "Prime Rate" shall have the meaning ascribed to it in Section
4.1(b)(3) below.
1.24 "Required Amount" shall have the meaning ascribed to it in Section
4.3(a)(1) below.
1.25 "Site Plan" means the site plan attached as Exhibit C, as the same
may be modified or revised. The Site Plan depicts the Site Plan Improvements on
the LLC Property.
1.26 "Site Plan Improvements" means all of the improvements shown on or
contemplated by the Site Plan, including the parking garage to serve the gaming
operations of Majestic and Xxxxx.
1.27 "State" means the State of Delaware.
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1.28 "Uncontrollable Expenses" shall have the meaning ascribed to it in
Section 3.9(a).
2. ORGANIZATION.
2.1 Name. The name of the LLC is Xxxxxxxxxx Harbor Parking Associates,
LLC, and such name shall be used at all times in connection with the business
and affairs of the LLC.
2.2 Organization of the LLC. The Members shall execute or cause to be
executed and filed such documents and instruments with such appropriate
authorities as may be necessary or appropriate from time to time to comply with
all requirements for the formation and operation of a limited liability company
in the State and for the qualification of a limited liability company to
transact business in the State of Indiana.
2.3 Purpose of the LLC. The business and purposes of the LLC shall, with
the consent of both Members, be:
(a) To acquire the LLC Property;
(b) To enter into leases, subleases and/or other arrangements
regarding the use or occupancy of all or part of the Site Plan Improvements and
LLC Property with Barden, Trump, BHR and/or any other Person, upon such terms
and conditions as are specified herein or are otherwise approved by the LLC;
(c) To enter into loan agreements, mortgages, security agreements
and all such other agreements and documents necessary to obtain financing for
the costs to acquire the LLC Property and construct the Site Plan Improvements;
(d) To construct the Site Plan Improvements;
(e) To obtain all necessary permits, licenses and approvals with
respect to the construction, operation, maintenance, repair and replacement of
the Site Plan Improvements;
(f) To construct, operate, maintain, repair and replace the Site
Plan Improvements;
(g) To enter into a parking lease with BHR (the "Lease"), with
respect to the use of the Site Plan Improvements and the terms on which BHR, its
members and their respective customers may use the Site Plan Improvements;
(h) To otherwise develop, improve, manage, exchange, finance,
operate and deal with and in every way exercise complete control and dominion
over the LLC Property and all assets acquired and facilities constructed in
connection therewith; and
(i) To do all things necessary or desirable in connection with the
foregoing or as otherwise contemplated in this Agreement, including but not
limited to
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executing and delivering such documents and instruments as are necessary to
effectuate or memorialize any of the foregoing.
2.4 No Other Purpose. The LLC shall have no other purpose (including,
without limitation, no purpose having to do with the operation of casinos, or
any other projects of Xxxxxx or Xxxxx or any affiliate of Xxxxxx or Xxxxx),
unless approved by both Members in writing. The LLC shall not assume any
obligation of either or both of the Members to the City, the Commission or the
State of Indiana unless approved by both Members in writing.
2.5 Property for Resale. The LLC shall not hold any real property
primarily for resale to customers in the ordinary course of its trade or
business, but may lease, sublease or exchange certain portions thereof in
furtherance of the LLC's activities.
2.6 Term. The term of the LLC will commence on the date of the filing of
the Certificate, and shall continue in existence until terminated pursuant to
this Agreement.
2.7 Registered Agent and Office. The registered agent is Corporation
Service Company. The registered office is at 0000 Xxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxx 000000000. The principal place of business and mailing address of the
LLC shall be determined by the Members. The LLC may maintain additional offices
at such locations as the Operating Committee deems advisable.
2.8 Title to LLC Property. All of the LLC's right, title and interest in
tangible property, intangible property, real property, personal property and
other assets acquired by the LLC shall be held in the name of the LLC as an
entity. The Members shall execute such documents as may be necessary to reflect
the LLC's ownership interest in such property and shall record the same in such
public offices as shall be necessary to reflect such ownership interest by the
LLC. No Member shall have an ownership interest in any property of the LLC in
its individual name or right except any such right held pursuant to a separate
written agreement approved by both Members, and each Member's LLC interest shall
be personal property for all purposes.
2.9 Trade Name. The LLC shall adopt such trade name as may be agreed
upon by the Members in writing.
2.10 Mutual Representations and Warranties. Each Member represents and
warrants to the LLC and to the other Member that as of the date of this
Agreement:
(a) It is a corporation (or in the case of Xxxxxx, a limited
liability company) duly organized and validly existing under the laws of the
state of its organization and is qualified to do business in the State of
Indiana; has all necessary power and authority under its Articles of
Incorporation and Bylaws or other applicable organizational documents and the
laws of the state of organization to own its properties and assets, to conduct
its business as now conducted or as contemplated by this Agreement, and to
execute and deliver and perform its obligations under this Agreement.
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(b) The execution and delivery of this Agreement, the formation of
the LLC and the performance of all obligations hereunder required to be
performed by such Member have been duly authorized by all necessary corporate
(or other organizational) action and do not and will not result in a breach or
violation of, or default under, or will not with the giving of notice or passage
of time, or both, result in a default under, its Articles of Incorporation and
Bylaws (or other applicable organizational documents), any agreement,
commitment, order, judgment or decree by which it or any of its constituent
shareholders or members or any of its respective properties is or are bound, or
any statute, regulation, order or other law by which it or any of its
constituent shareholders or members is or are subject.
(c) This Agreement is binding upon each Member and is enforceable
against it in accordance with its terms.
(d) It is not a "foreign person" within the meaning of Section
1445(f) of the Code.
3. MANAGEMENT AND DEVELOPMENT.
3.1 Implementation of Site Plan Construction Committee.
(a) The Members agree that the LLC Property is to be developed in
accordance with the Site Plan. Each Member agrees to cooperate with the other in
causing the LLC to construct the Site Plan Improvements at the earliest
practical time and at a cost within the amounts budgeted therefor in the
Improvements Budget. The Members acknowledge that they must use every effort to
reach timely agreement on such construction plans and specifications as are
necessary to implement the construction of the Site Plan Improvements within the
Improvements Budget. The Members also shall use every effort to agree upon any
modifications to the Site Plan (and applicable construction plans and
specifications) which are necessary to complete the Site Plan Improvements in a
timely fashion within the Improvements Budget or in accordance with applicable
laws, rules and regulations, but the Site Plan shall not be modified otherwise
unless such modification is agreed to in writing by the Members.
(b) In order to facilitate the construction of the Site Plan
Improvements, the management and control of such construction activities shall
be vested in a committee (the "Construction Committee") consisting of one voting
representative appointed by each Member (each such representative, a
"Construction Representative," and both such representatives, collectively, the
"Construction Representatives").
(c) In the absence of a contrary direction from the Operating
Committee or both Members, the Construction Committee shall have day-to-day
authority over the construction of the Site Plan Improvements, including
oversight over and administration of the applicable architect, engineering and
construction contracts, architect, supplier, engineer or contractor payments,
and the award of contracts in an amount less than two hundred fifty thousand
($250,000) dollars; all provided that the same are in accordance with budgets
and schedules previously approved by the Operating Committee. All payments shall
be made in accordance with the disbursement procedures set forth in Section
3.8(c) below. The LLC will
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retain or utilize the services of the Persons in the capacities identified in
attached Exhibit D, unless the Members agree to the contrary.
(d) It is contemplated that each Construction Representative shall
meet at the construction site (or at such other location as the Construction
Representatives agree upon) not less than twice each week. The presence of both
Construction Representatives at a meeting of the Construction Committee shall
constitute a quorum, and the Construction Committee shall act only upon the
affirmative approval of both Construction Representatives. No Member shall be
entitled to compensation for the services of the Construction Representative
appointed by it. The LLC is a member managed limited liability company. Each
Construction Representative shall be deemed to be the agent of, and to
represent, the member that appointed him and her, and shall owe his or her
loyalty and duty to such Member.
3.2 Operating Committee.
(a) The management and control of the ordinary business and affairs
of the LLC shall be vested in the Members. The Members shall manage and control
the business and affairs of the LLC (other than the affairs managed by the
Construction Committee established pursuant to Section 3.1 above) through a
committee (the "Operating Committee") consisting of two voting representatives
appointed by each Member (each such representative, a "Representative," and all
of such representatives, collectively, the "Representatives"). Except as
otherwise provided in this Agreement, the Operating Committee shall have full
and exclusive authority and discretion over the business of the LLC. The
presence of all four Representatives at a meeting of the Operating Committee
shall constitute a quorum.
(b) In connection with the development and construction of the Site
Plan Improvements, the Operating Committee shall:
(1) review and, if appropriate, refine or revise the Site Plan
and approve construction plans and specifications for the Site Plan
Improvements;
(2) develop traffic and circulation plans;
(3) address environmental remediation issues, if any;
(4) obtain necessary permits, licenses and approvals in order
to construct the Site Plan Improvements;
(5) arrange for construction and property insurance and
contractor bonding;
(6) engage necessary architects, engineers, designers,
suppliers and contractors required in connection with the design and
construction of the improvements;
(7) oversee compliance with any affirmative action, equal
employment opportunity or like requirements imposed on the LLC;
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(8) make any decisions that otherwise are within the authority
of the Construction Committee to make, but upon which the Construction Committee
cannot agree; and
(9) oversee and manage aspects of project scheduling or
construction that are outside of the authority of the Construction Committee.
(c) In connection with the operation, maintenance, repair and
replacement of the LLC Property, the Operating Committee shall coordinate and
assist in establishing or shall otherwise provide for the:
(1) security for the LLC Property;
(2) transportation within the LLC Property;
(3) maintenance of the LLC Property;
(4) hiring and training of employees and managing the LLC
Property on a day-to-day basis in a manner complying with the requirements of
applicable laws, rules and regulations, and any other obligations of the LLC;
(5) insurance and bonding for LLC Property.
(d) Except as provided in Section 3.3, in addition to and not in
limitation of the foregoing, the Operating Committee shall take such other
actions as may be reasonably necessary and desirable in connection with the
purposes of the LLC as provided in Section 2 of this Agreement.
(e) The Members agree as follows with respect to Operating
Committee meetings:
(1) The Operating Committee shall meet on a regular basis, not
less frequently than bimonthly. At such meetings the Operating Committee shall
review the affairs and operations of the LLC, including the status of the Site
Plan and the construction of the Site Plan Improvements; review and, if
appropriate, revise in light of actual experience the annual budget theretofore
approved by the Operating Committee; and consider and pass upon such other
matters which, pursuant to the provisions of this Agreement, are to be submitted
to the Operating Committee for its approval. All such meetings shall be held in
the vicinity of the LLC Property or at such other location upon which the
Members shall agree. Actions of the Operating Committee shall be reflected in
written consents, which may be faxed or telephoned if confirmed in writing.
(2) Any Member shall have the right from time to time to call a
special meeting of the Operating Committee on not less than ten (10) days' prior
written notice to the other Member; provided, a special meeting may be called
upon three (3) days' prior telephonic notice if the meeting is required to allow
the LLC to make timely decisions necessary to maintain construction or
development progress or to address other exigent circumstances.
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Each special meeting shall be held at the principal office of the LLC or at such
other location upon which the Members shall agree.
(3) All meetings hereinabove provided for may be conducted by
telephone.
(f) The Operating Committee may engage any Person whether directly
or indirectly affiliated with or related to any Member, on behalf of the LLC to
render or perform a service (including but not limited to leasing and financing)
or to supply merchandise or other property, and neither the LLC nor any of the
Members shall have any rights in or to any income or profits derived therefrom
by such Person as a result of this Agreement. Any contract proposed to be
entered into between the LLC and an Affiliate of either Member shall be
disclosed in writing as such to the Members in advance and (except as
specifically waived in writing by the Members) shall be on terms and conditions
which are no less favorable to the LLC than would be available from third
parties.
(g) Except as specifically set forth herein, the Members shall not
be entitled to any compensation with respect to any duties performed for or on
behalf of the LLC. Each Member shall bear the cost of its own personnel, the
fees of its own legal counsel and overhead (including any costs incurred in the
name of an entity other than the LLC unless such costs are incurred to third
parties with the prior written approval of the Operating Committee or the
Members), which costs shall not be charged to the LLC.
(h) The LLC is a member-managed limited liability company. Each
Representative shall be deemed to be the agent of, and to represent, the Member
that appointed him and her, and shall owe his or her loyalty and duty to such
Member. The two Representatives appointed by each Member shall act in concert
with one another in approving, or declining to approve, any action of the
Operating Committee.
3.3 Matters Requiring Special Approval of the Members. The following
shall require the unanimous approval of the Members, which approval shall be
evidenced by a written memorandum executed by an authorized officer or member of
each Member:
(a) The establishment and approval of the initial Operating Plan
and Budget;
(b) Approval of changes to the Site Plan;
(c) Approval of a material change in the schedule for completion of
the Site Plan Improvements;
(d) Approval of the terms of any financing for the construction of
the Site Plan Improvements;
(e) Establishment of the timing and amounts of any distributions to
the Members;
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(f) Any decision to amend, renew, extend or otherwise, change the
terms and conditions of the Lease (if any);
(g) The selection of the legal counsel and certified public
accountants for the LLC, although the certified public accountants shall be a
Big 5 accounting firm;
(h) The approval or modification of the terms of any agreement
between the LLC and the City or the State of Indiana; and
(i) Any other matter which Xxxxxx and Xxxxx both shall deem, in
writing, to be of fundamental importance to the LLC.
Notwithstanding the foregoing, in the event the LLC enters into any agreement
with a Member or with an Affiliate of a Member other than BHR, an "Affiliate
Agreement") the other Member shall have the sole power and authority to
determine whether, how and when the LLC will enforce its rights or invoke its
remedies with respect to the Affiliate Agreement.
3.4 Members May Engage in Other Businesses. The Members and each of the
Construction Representatives and Representatives and their respective Affiliates
may engage independently or with others in other business ventures of every kind
and nature including, but not limited to, the ownership, financing, leasing,
operation, management, brokerage, sale and development of real property, or
gaming operations, whether or not competitive with the business of the LLC or
any of its assets or facilities, and neither the LLC, the Members, the
Construction Representatives, the Representatives nor their respective
Affiliates, shall have any rights by virtue of this Agreement in and to said
independent ventures or to the income or profits derived therefrom.
Notwithstanding the foregoing, (a) any direct or indirect interest of Member or
an Affiliate of a Member in any contract or other act with or in respect of the
LLC, other than its interest as a Member, shall be disclosed in writing to the
other Member, (b) a Member shall account to the LLC for any property, profit or
benefit derived by such Member or its Affiliate from a use or appropriation of
property of the LLC, including information developed exclusively for the LLC,
and (c) if a member or an Affiliate of a Member acquires or has acquired in its
own name, any property, permit, license or approval that is required by the LLC
to (i) construct and develop the Site Plan Improvements, (ii) operate the
parking garage, or (iii) otherwise carry out the purposes of the LLC, such
Member shall make, or shall cause its Affiliate to make, such property, permit,
license or approval available to the LLC on the terms and conditions on which
the member or its Affiliate acquired the same.
3.5 Members' Liability.
(a) The Members, Construction Representatives and Representatives
shall not be responsible or accountable in damages or otherwise to the LLC, any
Member, Construction Representative, Representative or any other Person for any
acts performed in good faith within the scope of authority conferred on them by
this Agreement, or for their performance of, or failure or refusal to perform,
any acts required by or prohibited or inhibited by any governmental act or
decree of any nature. The Members, Construction Representatives and
Representatives shall be entitled to indemnity from the LLC on account of
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any claim, liability, action or damage arising from or relating to any action
taken by them, in good faith, for or on behalf of the LLC as aforesaid.
(b) Notwithstanding the foregoing, and subject to the management
prerogatives of each of the Members under this Agreement, each Member agrees to
act in good faith in participating in the affairs of the LLC and in approving
and taking actions required for the LLC to efficiently conduct its operations so
as to accomplish the purposes of the LLC, including by (i) attending, or causing
its Construction Representative and Representatives to attend, meetings of the
Members, the Construction Committee or the Operating Committee, as applicable,
(ii) executing contracts and other documents that have been approved under this
Agreement, including checks for expenses that have been approved during the
budgeting process or otherwise, and (iii) otherwise not impeding the ability of
the LLC to accomplish its purposes so as to permit the efficient construction
and operation of the Site Plan Improvements.
(c) In the event any action or proceeding is instituted or
threatened against any Member, Construction Representative, Representative or
any of them, or any officer, director, shareholder, guarantor or employee of a
Member, in connection with the LLC Property or the business or affairs of the
LLC (except actions or proceedings between the Members or by the LLC) or to
which any of the foregoing may be a party on behalf of the LLC, each Member,
Construction Representative or Representative, as the case may be, shall be
entitled to retain legal counsel and other experts at the expense of the LLC and
(subject to the limitation of liability set forth in Section 3.5(a)) any of the
foregoing shall be immediately reimbursed for, indemnified against and held
harmless by the LLC with respect to all liabilities, costs and expenses arising
out of, or in connection with, such action or proceeding, and whether or not any
of the foregoing is serving in such capacity as of the date that such liability,
costs or expenses are fixed or incurred and without awaiting determination of
the actual proceeding. In any action commenced against the LLC, no Member,
Construction Representative or Representative shall be joined or named as a
party, except as an indispensable party as may be required by applicable statute
or court rule. In the event the indemnified Person is judicially determined not
to have acted in good faith with regard to the claim asserted against it, such
Person shall, in addition to its liability in respect of such wrongful actions,
forthwith reimburse the LLC for payments made to such Person under this Section
3.5(c).
3.6 Bank Accounts. All funds of the LLC shall be deposited and
maintained in a bank or banks designated by the Operating Committee and in
accounts established in the LLC's name. The Operating Committee shall pay out of
such accounts, to the extent of the funds from time to time therein, all costs
and expenses incurred in connection with the development, construction,
operation and management of the LLC Property and all costs and expenses incurred
in connection with the purposes of the LLC as provided in Section 2. Checks or
other documents of withdrawal drawn upon the accounts shall be signed by two
members of an Operating Committee, one each from Xxxxx and Xxxxxx, or by persons
designated as signatories on behalf of each Member.
3.7 Books and Records. The Operating Committee shall keep full and
adequate books of account and other records reflecting the results of the LLC
from inception of the LLC. Such books and records shall be kept at the offices
of the LLC and shall at all times
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be kept in accordance with (i) generally accepted accounting principles,
consistently applied, and (ii) such laws, rules, regulations and orders
applicable to the LLC.
3.8 Financial Reports and Records.
(a) Financial Reports. The Operating Committee shall deliver to the
LLC within thirty (30) days after the end of each calendar month, an unaudited
financial statement prepared from the books and records of account maintained by
the Operating Committee, which financial statement shall be set forth on an
accrual basis, containing (i) a balance sheet as of the end of such calendar
quarter; (ii) an income and loss statement; and (iii) copies of all statements,
if any, filed with the Commission. The Operating Committee shall also deliver to
the LLC, within ninety (90) days after the end of each calendar year, an audited
financial statement prepared by an independent certified public accounting firm
containing (i) a balance sheet as of the end of such year; (ii) an income and
loss statement for such year; (iii) a statement of cash flows for such year; and
(iv) copies of all statements, if any, filed with the Commission. Once received
by the LLC, copies of all reports shall immediately be delivered to each Member.
(b) Records. The Operating Committee shall keep complete records of
all revenues and expenses with respect to the management and operation of the
LLC Property. Each Member shall have the right, itself or through its
representatives or accountants, at its own expense, to inspect the books of,
account and records of the LLC and audit the statements required by this Section
3.8, at any time and from time to time during business hours of the LLC. Such
inspections and audits shall take place at the offices of the LLC and
out-of-pocket expenses incurred by the inspecting Member relative to such audit
shall be the responsibility of the inspecting Member.
(c) Construction Procedures. In connection with paying any amounts
payable in respect of construction of the Site Plan Improvements, the LLC shall
procure such sworn statements, waivers of lien, architect's certificates,
inspection reports and like documents as are typically procured as part of
prudent construction draw practices and procedures, both to ensure that the
applicable funds are being disbursed in accordance with the relevant
construction contract, architect's agreement and/or construction management
agreement (including requirements relative to retainage and keeping the
contracts in balance) and to prevent mechanic's liens or similar impositions
from being imposed on the LLC Property or any part thereof. Also in connection
with such construction activities the LLC will prepare and distribute to the
Members cash flow statements on a periodic (not less frequently than monthly)
basis for each applicable construction project, showing payments made to date,
available funds, the anticipated costs of completion and cost comparisons
relative to budget.
3.9 Annual Budget.
(a) The Operating Committee will prepare an annual business plan
and operating budget for each year, (the "Operating Plan and Budget"), which
shall be submitted to the Members for approval and formal adoption. The
Operating Plan and Budget shall include the Operating Reserve. Upon approval by
the Members of the Operating Plan and Budget, the Operating Committee shall have
the right, without the further consent or approval of
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the Members, to incur and pay the operating expenses and capital improvement
costs set forth therein, including Uncontrollable Expenses whether or not they
exceed the amounts reflected for them in the Operating Plan and Budget; provided
that in the case of any operating expense which is not an Uncontrollable
Expense, the Operating Committee shall not have the right to incur or pay the
same if it exceeds by more than 10% the amount set forth on the appropriate line
for the category of expense or cost involved in the Operating Plan and Budget or
if such expenditure will cause the aggregate amount of operating expenses which
are not Uncontrollable Expenses to exceed by more than 5% the aggregate amount
of such operating expenses provided for in the Operating Plan and Budget. As
used in this Section 3.9, the term "Uncontrollable Expense" shall mean an item
of expense, the amount of which is not within the power of the Operating
Committee to control and shall consist of real estate taxes, debt service
payable in respect of any mortgage or other loans obtained in accordance with
the terms of this Agreement, premiums for insurance, fixed charges under
contracts, utility charges and such other costs and expenses as may hereafter be
designated as Uncontrollable Expenses by the Members.
(b) If at any time the Operating Committee desires to make a
capital improvement, repair, replacement or alteration, or to incur an operating
expense, which is not provided for in an Operating Plan and Budget, the
Operating Committee shall not proceed with such improvement, repair, replacement
or alteration, and shall not incur such expense, without the Members' prior
written consent. If at any time it becomes evident to the Operating Committee
that the cost of any capital improvement, repair, replacement or alteration
provided for in the Operating Plan and Budget will exceed by more than 10% the
amount budgeted therefor in such budget, or the aggregate amount of the cost of
all capital improvements, repairs, replacements and alterations provided for in
such budget will exceed by more than 5% the amount budgeted therefor in such
budget, the Operating Committee shall not proceed further with the making of
such improvement, repair, replacement or alteration or, where the aggregate
amount set forth in the Operating Plan and Budget will be exceeded by more than
5%, with any of such capital improvements, repairs, replacements or alterations,
without the written consent of the Members. Similarly, if at any time it becomes
evident to the Operating Committee that the cost of any operating expense which
is not an Uncontrollable Expense will exceed by more than 10% the amount set
forth in respect thereof in the Operating Plan and Budget, or the cost of all
such expenses will exceed by more than 5% the aggregate amount-budgeted therefor
in such Operating Plan and Budget, the Operating Committee shall not incur the
operating expense in question, or, where the aggregate amount of such expenses
will exceed by more than 5% the aggregate amount budgeted for in such approved
Operating Plan and Budget, any of such operating expenses, without the written
consent of the Members.
(c) Notwithstanding anything to the contrary set forth in this
subsection, if in the reasonable good-faith judgment of the Operating Committee
any capital improvement, repair, replacement or alteration must at any time
immediately be undertaken, or any operating cost immediately incurred, in order
to protect any property or to avoid accident or injury to Persons, the Operating
Committee shall be free to make such capital improvement, repair, replacement or
alteration or to incur such operating expense without regard to the approved
Operating Plan and Budget and without first securing the approval of the
Members, provided that the Operating Committee shall use its reasonable efforts
to limit the work performed to the minimum required to remedy the emergency
condition pending approval by the
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Members of more extensive work and the Operating Committee shall notify the
Members promptly of any such expenditure made or incurred which exceeds $20,000.
(d) The initial Operating Plan and Budget shall be agreed to within
30 days after the date of this Agreement. Subsequent Operating Plans and Budgets
shall be agreed to prior to the commencement of the applicable fiscal year of
the LLC. If the Members can not reach agreement on the Operating Plan and Budget
for a fiscal year, the Operating Plan and Budget shall be determined by (i)
adjusting Uncontrollable Expenses to the levels the members anticipate will be
incurred or for which the LLC is contractually obligated, (ii) establishing the
Operating Reserve, and (iii) increasing the remaining line items in the
Operating Plan and Budget for the prior fiscal year by five (5%) percent.
(e) If during any year it becomes apparent that the Operating Plan
and Budget does not reflect the amounts of money the LLC will have to spend to
(i) meet its contractual obligations under any mortgage or other loans obtained
in accordance with the terms of this Agreement, or (ii) maintain and operate the
Site Plan Improvements in the manner and to the standards contemplated by this
Agreement (e.g., the Operating Plan and Budget for the year in question did not
accurately reflect the applicable financial requirements or the occurrence of
some unanticipated event, such as an uninsured casualty), the Members shall
revise the Operating Plan and Budget for such year to reflect the amounts
necessary for the LLC to meet such contractual obligations or to maintain and
operate the parking garage in the manner and to the standards contemplated by
this Agreement; provided, in no event shall such an obligatory increase or
increases in respect of expenses of the nature specified in subclause (ii) of
this subsection (e) be greater than one hundred thousand ($100,000) dollars
during any fiscal year.
3.10 Decisions of the Operating Committee. All decisions of the
Operating Committee shall require the consent of all of the Representatives. In
the event that the Representatives do not concur in any action, the arbitration
procedures set forth in Section 13 shall become applicable unless the Members
agree upon the action.
4. CAPITAL CONTRIBUTIONS; PROFITS AND LOSSES, AND DISTRIBUTIONS.
4.1 Capital Contributions.
(a) Initial Capital Contributions. Each Member is making or shall
make the following contributions to the LLC (the "Initial Contributions") at the
times indicated below:
(1) Upon the execution of this Agreement Xxxxx shall contribute
in cash or immediately available funds the sum of one hundred ($100) dollars;
(2) Also upon execution of this Agreement Xxxxxx shall
contribute in cash or immediately available funds the sum of one hundred ($100)
dollars;
(b) Capital Accounts. There shall be established on the books of
the LLC for each Member a capital account (the "Capital Account"), which shall
consist of the value of such Member's capital contributions pursuant to Section
4.1(a)(1) and (2), increased by
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(i) the amount of all additional contributions, if any, to the capital of the
LLC made by such Member pursuant to Sections 4.1(e), 4.4 or otherwise, and (ii)
the amount of all Net Income credited to the account of such Member pursuant to
Section 4.5 and decreased by (x) the amount of all Net Losses charged to the
account of such Member pursuant to Section 4.5, and (y) the amount of all
distributions, if any, made to such Member pursuant to Section 4.9 or otherwise.
It is agreed that the Initial Contributions of the Members pursuant to Section
4.1 (a) above shall result in the Capital Accounts of each Member being equal
after all such Initial Contributions have been made. Payments by the LLC on
account of an indemnification obligation of the LLC to a Member shall not be
deemed distributions to such Member.
(c) Maintenance of Capital Accounts. Notwithstanding anything
herein to the contrary, it is the intention of the members to maintain each
Member's Capital Account in accordance with Treas. Reg. 1.704-I(b)(2)(iv).
(d) Additional Capital Contributions. The Members as such shall not
be bound by the obligations of the LLC, and shall not be obligated to make
contributions to the LLC in excess of the amounts provided for in Section
4.1(a). Notwithstanding the foregoing, the Members hereby agree to contribute
additional funds in the form of capital contributions to the LLC on a pro rata
basis in proportion to their respective Percentage Interests whenever the
Operating Committee discretionarily elects, but in no event unless such
additional funds are necessary to accomplish the business or purpose of the LLC.
4.2 Percentage Interest in the LLC. Each Member shall have an interest
in the LLC (the "Percentage Interest") of fifty (50%) percent.
4.3 Cash Needs; Contributions and Loans.
(a) It is understood that the LLC may from time to time require
funds in addition to the funds which may then be available to the LLC out of (i)
gross revenues generated from its operations (including without limitation
payments under the Lease (if any)), (ii) loans made to the LLC (not including
loans made by the Members pursuant to this Section 4 but including loans
available to the LLC within the time period the funds in question are required
for use by the LLC), (iii) contributions made by Xxxxxx and Xxxxx to the capital
of the LLC pursuant to this Section 4, and (iv) in the event of a fire, other
casualty or condemnation, the amount of insurance proceeds or condemnation
awards available to the LLC to pay the costs of such repairs or restoration. In
order to help ensure that the LLC will have funds in amounts sufficient to meet
its needs at all times the Members agree as follows:
(1) if at any time either Member determines, in the exercise of
reasonable business judgment and good faith, that funds in an amount less than
$100,000.00 are required to meet Cash Needs of the LLC, such Member may, by
notice (the "Cash Needs Notice") to the Members, specify the entire amount of
the Cash Needs of the LLC at such time (the "Required Amount") and call upon the
Members to advance to the LLC their respective proportionate share, determined
in accordance with each Member's Percentage Interest, of the Required Amount
(each Member's "Requested Contribution"). The Cash Needs Notice given to the
Members shall be accompanied by documentation reasonably satisfactory to the
Members confirming the actual or estimated amount of such Cash Needs of the LLC
(and the
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Required Amount) for the period for which such demand is being made (which
period shall not be less than thirty (30) days and shall not exceed ninety (90)
days) and itemizing how the Required Amount will be applied. Within thirty (30)
days after the date of the Cash Needs Notice, each Member shall advance as a
capital contribution to the LLC its Requested Contribution. Any funds advanced
by either Member to the LLC pursuant to this Subsection 4.3(a)(1) and not
refunded to such Member shall, subject to the provisions of Subsection 43(a)(2),
constitute "Cash Needs Contributions" and shall constitute contributions to the
capital of the LLC. No Member shall be personally liable to the LLC or the other
Member for its failure to advance funds to the LLC pursuant to this Subsection
43(a)(1), but any Member who fails to advance a part of its share of the
Required Amount shall thereby become subject to the provisions of Subsection
43(a)(2).
(2) If either Member (such Member being hereinafter referred to
as the "Non-Contributing Member") shall fail to advance all or any part of its
share of the Required Amount which it is called upon and requested to advance
pursuant to a Cash Needs Notice within thirty (30) days after the date of such
Cash Needs Notice (the "Due Date" shall be deemed to be the last day of said 30
day period), the other Member (the "Contributing Member") shall have the
following rights and remedies (which rights and remedies shall be exclusive):
(i) If the Non-Contributing Member shall have advanced none
of its share of the Required Amount on or before the Due Date, the Contributing
Member shall be relieved of any obligation to advance any portion of its share
of the Required Amount and shall be entitled, if it so elects, to receive a
refund from the LLC of all amounts which it may have advanced to the LLC
pursuant to the Cash Needs Notice.
(ii) If the Non-Contributing Member shall have advanced
part, but not all, of its share of the Required Amount on or before the Due
Date, the Contributing Member shall be relieved of any obligation to advance any
portion of its share of the Required Amount in excess of its Percentage Interest
of the Base Amount and shall be entitled, if it so elects, to receive a refund
from the LLC of all amounts which it may have advanced to the LLC pursuant to
the Cash Needs Notice in excess of its Percentage interest of the Base Amount.
As used in this Subsection 4.3(a)(2)(B), the term "Base Amount" shall mean the
amount of the Required Amount actually contributed by the Non-Contributing
Member on or before the Due Date, divided by the Percentage Interest of the
Non-Contributing Member.
(iii) The Contributing member shall be entitled, but shall
not be obligated, within sixty (60) days of the date of the Cash Needs Notice to
advance to the LLC (which for this purpose shall include not electing to receive
any refund to which it is entitled pursuant to Subsections 4.3(a) (2) (A) or (B)
above, as applicable) an amount equal to all or any part of the excess of (i)
the Requested Funds over (ii) the Base Amount, if any, and such advance shall
constitute a loan (a "Cash Needs Loan") to the LLC, which Cash Needs Loan shall
bear interest at the Prime Rate plus five (5%) percent (although in no event
shall such interest rate exceed the maxim interest rate permitted by applicable
law), and shall be repayable, as to interest and principal, before any other
distributions are made to the Members as hereinafter provided in Section 4.9.
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(3) As used in this Section 4.3, "Cash Needs of the LLC" shall
mean and include any cash needs or requirements of the LLC of whatever kind or
nature subsequent to the date hereof for which sufficient funds are not
available to it from the sources described in Subsections 4.3(a)(i) through
(iv), and shall include, without limiting the generality of the foregoing, costs
of repairs, alterations and improvements to the LLC Property, operating costs of
the LLC Property, debt service payable under mortgages and other loans (other
than Cash Needs Loans) made to the LLC, real estate taxes and any other payments
which are necessary or appropriate to make in the ordinary course of business to
protect or further the interests of the LLC.
4.4 Income and Losses. "Net Income" and "Net Losses" with respect to
any fiscal period shall mean the net income or net losses of the LLC for that
period from the construction, operation and management of the LLC Property
(including the amount of any tax exempt income received or accrued) after all
operating expenses incurred in connection with the LLC's business (including,
without limitation, real estate taxes, utilities, repairs and maintenance,
management fees, insurance, labor costs and interest on Cash Needs Loans and any
other loans to the LLC) have been paid or accrued and after making allowance for
depreciation or amortization of the cost of the LLC Property and assets of the
LLC and expenditures of the LLC of the nature described in Section 705(a)(2)(B)
of the Code (including expenditures treated as described in Section 705(a)(2)(B)
of the Code under Treas. Reg. S 1.704-1(b)(2)(iv)(i) ("Section 705(a)(2)(B)
Expenditures")) and after taking into account any gain or loss arising from
capital transactions. Consistent with the foregoing definition, income, net
losses, gain and loss shall be determined on the same basis as reported by the
LLC for federal income tax purposes; provided, however, that in computing net
income, net loss, gain and loss of the LLC it shall be assumed that the agreed
fair market value of any Property contributed to the LLC by any Member is an
amount equal to its initial tax basis.
4.5 Allocation of Net Income and Net Losses. From and after the date of
this Agreement, the Net Income and Net Losses of the LLC for each calendar year
or fraction thereof shall be allocated to the Capital Accounts of the Members in
accordance with their Percentage Interests.
4.6 Special Allocations. From and after the date of this Agreement, the
following special allocation provisions shall apply:
(a) Qualified Income Offset. Notwithstanding the allocation
provided in Section 4.5 and except as otherwise provided in this Section 4.6, in
the event any Member receives an unexpected allocation of Net Loss or deduction
or an unexpected distribution as described in Treasury Regulations
1.704-1(b)(2)(ii)(d)(4), (5) or (6) that results in a deficit balance in its
Capital Account (after taking into account reductions for the items set forth in
Treasury Regulations 1.704-1(b)(2)(ii)(d)(4), (5), or (6)) in excess of (i) the
amount such Member is obligated to restore, if any, and (ii) the amount such
Member is deemed to be obligated to restore pursuant to the penultimate sentence
of Treasury Regulations 1.704-2(g)(1) and 1.704-2(i)(5), such Member shall be
allocated items of gross income or gain in the amount. necessary to eliminate
such excess as quickly as possible. This provision is intended to satisfy the
definition of "qualified income offset", as defined in Treasury Regulation
1.7041(b)(2)(ii)(d).
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(b) Minimum Gain. Notwithstanding the allocation provided in
Section 4.5 and except as otherwise provided in this Section 4.6, if there is a
net decrease in LLC Minimum Gain during any fiscal year, each Member with a
deficit Capital Account balance at the end of such fiscal year (decreased by the
amount such Member is obligated to restore and the amount such Member is deemed
to be obligated to restore pursuant to the penultimate sentences of Treasury
Regulations 1.704-2(g)(1) and 1.704-(2)(i)(5), and increased by the items set
forth in Treasury Regulations 1.704-1(b)(2)(ii)(d)(4), (5) or (6)) shall be
allocated items of gross income and gain for such fiscal year and, if necessary,
for subsequent fiscal years, in an amount equal to such Member's share of the
net decrease in such LLC Minimum Gain, determined in accordance with Treasury
Regulations 1.704-2(g)(2). This provision is intended to satisfy the definition
of a "minimum gain chargeback" as defined in Treasury Regulations 1.7042(f), and
the term "LLC Minimum Gain" shall have the meaning ascribed to the term
"Partnership Minimum Gain" in Treasury Regulation 1.704-2(d).
(c) Gross Income Allocation. Notwithstanding the allocation
provided in Section 4.5 and except as otherwise provided in this Section 4.6, in
the event any Member has a deficit Capital Account at the close of any fiscal
year which is in excess of the sum of (i) the amount, if any, such member is
obligated to restore pursuant to any provision of this Agreement, and (ii) the
amount such Member is deemed to be obligated to, restore pursuant to the
penultimate sentences of Treasury Regulations 1.704-2(g)(1) and 1.704-2(i)(5),
each Member shall be specially allocated items of gross income and gain in the
amount of such excess as quickly as possible, provided that an allocation
pursuant to this Section 4.6 shall be made only if and to the extent that such
Member would have a deficit Capital Account in excess of such sum after all
other allocations provided for in this Section 4.6 have been made as if Section
4.6(a) and this Section 4.6(c) were inoperative.
(d) Member Nonrecourse Deductions. Notwithstanding the allocation
provided for in Section 4.5 and except as otherwise provided in this Section
4.6, any "Member Nonrecourse Deduction", defined as having the meaning ascribed
to the term "Partner Nonrecourse Deduction" in Treasury Regulation
1.704-2(i)(2), for any fiscal year shall be allocated to the Member who bears
the economic risk of loss in accordance with Treasury Regulation 1.704-2(i)(1),
and if there is a net decrease in Member Nonrecourse Debt Minimum Gain during
any fiscal year, each Member with a deficit Capital Account balance at the end
of such fiscal year (decreased by the amount, if any, such Member is obligated
to restore and the amount such Member is deemed to be obligated to restore
pursuant to the penultimate sentences of Treasury Regulation 1.704-2(g)(1) and
1.704-2(i)(5), and increased by the items set forth in Treasury Regulations
1.704-1(b)(2)(ii)(d)(4), (5) or (6)) shall be allocated items of gross income
and gain for such fiscal year and, if necessary, for subsequent fiscal years, in
an amount equal to such Member's share of the net decrease in such Member
Nonrecourse Debt Minimum Gain, determined in accordance with Treasury Regulation
1.704-2(i)(4). This provision is intended to comply with the chargeback
provisions of Treasury Regulation 1.704-2(i)(4), and the term "Member
Nonrecourse Debt Minimum Gain" shall have the meaning ascribed to the term
"Partner Nonrecourse Debt Minimum Gain" in Treasury Regulation 1.704-2(i)(3).
(e) Nonrecourse Deductions. Notwithstanding the allocations
provided for in Section 4.5 and except as otherwise provided in this Section
4.6, any "LLC Nonrecourse Deductions", defined as having the meaning ascribed to
the term "Partnership
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Nonrecourse Deductions" in Treasury Regulation 1.704-2(c), for any fiscal year
shall be allocated to the Members in accordance with their Percentage Interests
as provided under Treasury Regulation 1.704-2(e).
(f) Limitation on Loss Allocations. The Net Losses allocated
pursuant to Section 4.5 shall not exceed the maximum amount of Net Losses that
can be allocated without causing any Member to have a deficit balance in such
Member's Capital Account at the end of any fiscal year (decreased by the amount,
if any, such Member is obligated to restore to the LLC and the amount such
Member is deemed to be obligated to restore pursuant to the penultimate
sentences of Treasury Regulations 1.704-2(g)(1) and 1.704-2(i)(5), and increased
by the items set forth in Treasury Regulations 1.704-1(b)(2)(ii)(d)(4), (5) or
(6)). All Net Losses in excess of the limitations set forth in this paragraph
shall be allocated among the Members, pro-rata, to the extent each,
respectively, is liable or otherwise bears the economic risk of loss with
respect to any debt or other obligation of the LLC.
(g) Curative Allocations. The allocations set forth in Section 4.6
(the "Regulatory Allocations") are intended to comply with certain requirements
of Treasury Regulations 1.704-1 and 1.704-2. Notwithstanding any provision of
Section 4.6 (other than the Regulatory Allocations and the provisions of Section
4.7), the Regulatory Allocations shall be taken into account in allocating Net
Losses and Net Income and items of gross income, gain and deduction among the
Members so that, to the extent possible, the net amount of such allocations to
the Members shall be equal to the net amount that would have been allocated to
the Members if the Regulatory Allocations had not occurred.
(h) In-Kind Contributions. In accordance with Code Section 704(c)
and the Treasury Regulations thereunder, Net Income, gain, Net Loss and
deduction with respect to any property contributed to the capital of the LLC
shall, solely for tax purposes, be allocated among the Members so as to take
account of any variation between the adjusted basis of such property to the LLC
for federal income tax purposes and its initial fair market value. Any elections
or other decisions relating to such allocation shall be made by the Operating
Committee in any manner that reasonably reflects the purpose and intention of
this Agreement. Allocations pursuant to this Section 4.6(h) are solely for
purposes of federal, state and local taxes and shall not affect, or in any way
be taken into account in computing, any Member's Capital Account or share of Net
Income, Net Losses, other items or distributions pursuant to any provision of
this Agreement.
4.7 Authority To Vary Allocations. The Members intend that each
Member's distributive share of gross income, Net Income, gain, Net Loss or
deduction (or item thereof) shall be determined and allocated in accordance with
Sections 4.5 and 4.6 to the fullest extent permitted by Code Section 704(b). To
preserve and protect the determinations and allocations provided for in Sections
4.5 and 4.6, the Operating Committee shall, and hereby is authorized and
directed to, allocate Net Income, gross income, gain, Net Loss or deduction (or
item thereof) arising in any year differently than otherwise provided for in
Sections 4.5 and 4.6, if, and to the extent that, allocating Net income, gross
income, gain, Net Loss or deduction (or item thereof) in the manner provided for
in Sections 4.5 and 4.6 would cause the determinations and allocations of each
Member's distributive share of Net Income, gross income, gain, Net Loss or
deduction (or item thereof) not to be permitted by Code Section 704(b) or any
Treasury
19
Regulations promulgated thereunder. Any allocation made by the Operating
Committee pursuant to this Section 4.7 shall be deemed to be a complete
substitute for any allocation otherwise provided for in Section 4.5 or 4.6 and
no amendment of this Agreement or approval of any Member shall be required.
4.8 Members' Interest in Profits. Pursuant to Treas. Reg. 1.7523(a)(3),
the Members' interests in LLC profits shall be the Percentage Interests of the
Members.
4.9 Distributions to Members.
(a) As used in this Agreement, the term "Excess Cash Flow" for any
calendar year or fraction thereof shall mean the amount, if any, of cash
available to the LLC after (i) payment of all operating expenses, and (ii) the
establishment of the Operating Reserve and such other reserves as may determined
in the sole discretion of the Operating Committee.
(b) From and after the date of this Agreement, but subject to the
provisions of Section 9.2, the Excess Cash Flow for each calendar year of
fraction thereof shall be distributed to the Members as follows, and in the
following order of priority:
(1) An amount of Excess Cash Flow up to the amount of the
accrued and unpaid interest on Cash Needs Loans shall first be paid as interest
to the Members in proportion to the amount of such interest owed to each;
(2) An amount of Excess Cash Flow up to the then aggregate
unpaid principal balance of Cash Needs Loans shall next be distributed to the
members in proportion to the amount of such principal owed to each; and
(3) The balance, if any, of Excess Cash Flow shall be
distributed to the Members in proportion to their respective Percentage
Interests in the LLC.
4.10 Affiliated Borrowing. The Company shall borrow up to $15,000,000
from BHR on such terms as the Members and BHR shall approve, provided that (a)
no less than $9,000,000 of such debt shall mature no later than the 30' day
after the date hereof, (b) up to $9,000,000 of the principal amount thereof
shall be payable in-kind via the grant by the Company to BHR of a corresponding
amount of credit against BHR's obligation to prepay rent owing to the Company,
and (c) in the absence of a contrary directive from the Operating Committee,
such loan shall bear interest at 6% per annum.
5. ACCOUNTING.
5.1 Accounting Decisions. All decisions as to accounting principles and
elections, whether for book or tax purposes (and such decisions may be different
for each such purpose), shall be approved by the Operating Committee.
5.2 Tax Returns. The LLC, under the supervision of the Operating
Committee, will prepare and timely file federal and state income tax returns of
the LLC. As promptly as practicable, and in any event, in sufficient time to
permit timely preparation and
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filing by each Member of its respective federal and state tax returns, the LLC
shall deliver to each Member a copy of each federal and state tax return or tax
report filed by the LLC.
5.3 Elections. To the extent that the LLC may or is required to make
elections for federal, state or local tax purposes, and to the extent that
Members may or are required to make such elections concerning the business and
properties of the LLC and such elections may not be made in different ways by
different Members, such elections shall be made in such manner as is best
calculated, in the judgment of the operating Committee, to minimize taxable
income of the LLC and maximize deductions therefrom. In the event of the
transfer of all or part of the interest of a member, the Members shall elect
pursuant to Section 754 of the Code to adjust the basis of the LLC's property.
5.4 Information Concerning Basis. Each Member shall furnish to the LLC
information as to its adjusted basis for federal income tax purposes of all
property contributed by such Member to the LLC pursuant to Section 4.
6. WITHDRAWAL; ADJUDICATION; DISSOLUTION.
6.1 Withdrawal. Except as specifically permitted under the terms of
this Agreement, no member may withdraw or resign from the LLC. If a Member shall
withdraw or resign from the LLC (the "Withdrawn Member"), then at the election
of the other Member (a) the Withdrawn Member (and all Affiliates of the
Withdrawn Member) shall have no right to use any of the LLC Property, (b) the
Construction Representative selected by the Withdrawn Member shall immediately
be removed from the Construction Committee, (c) the Representatives selected by
the Withdrawn Member shall immediately be removed from the Operating Committee,
(d) the business theretofore conducted by the LLC shall thereafter be controlled
by the Construction Representative or the Representatives selected by the
remaining Member, (e) the Withdrawn Member shall remain liable to other Members
as if it were a Member but shall no longer have the rights and powers of a
Member, (f) the Withdrawn Member shall be liable to other Members for any loss
or damages resulting from such withdrawal, and (g) the Withdrawn Member shall be
entitled to, and only to
(1) those distributions to which the Withdrawn Member would
otherwise be entitled, as and when made, until such time, if ever, the LLC (at
the direction of the remaining Member) elects to pay the Withdrawn Member, in 24
interest-free installments, the sum described in Section 604 of the Act, less
(2) any amounts owing by the Withdrawn Member pursuant to this
Subsection 6.1, as may be set off by the LLC for the account of the LLC or the
other Member.
6.2 Adjudication of Incompetence; Death, Disability or Dissolution of a
Member. In the event any Member (the "Terminating Member") voluntarily withdraws
from the LLC or suffers death, mental incapacity or dissolution, then the other
Member (the "Non-Terminating Member") or its designee, shall succeed to the
rights and obligations of the Terminating Member, and the Terminating Member (or
any Affiliate thereof) shall have no right to use any of the LLC Property.
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7. EVENTS OF DEFAULT; REMEDIES.
7.1 Events of Default.
(a) The following shall constitute events of default under this
Agreement ("Events of Default"):
(1) The failure of any Member to fulfill any of its obligations
under this Agreement within thirty (30) days after written notice from the other
Member, which default may be cured during such thirty (30) day period; or
(2) A Member suffers Bankruptcy.
7.2 Remedies in the Event of Default by a Member. If a Member causes,
permits or suffers an Event of Default under this Agreement, such Member (the
"Defaulting Member") shall be subject to the following remedies, each of which
shall be cumulative and not exclusive of any other right or remedy of the other
Member. During any period in which an Event of Default continues: (i) the
Defaulting Member's approval shall no longer be required for any action by the
LLC which is specified under Section 3.3 above, and (ii) the Construction
Representative and the Representatives selected by the Defaulting Member which
is in default or deemed to be in default under this Agreement shall be suspended
from participation in the Construction Committee and the Operating Committee,
and (iii) the Construction Committee and the Operating Committee shall
thereafter be controlled by the Construction Representative or the
Representatives selected by the other Member.
8. SALE OR ASSIGNMENT OF INTEREST.
8.1 General Restrictions on Transfers.
(a) No interest of any Member in the LLC or otherwise under this
Agreement shall be sold, transferred or assigned, unless (i) such transaction
complies with any relevant provisions of Section 8.2, (ii) any sale or other
assignment of the interest subsumes the Member's entire interest in the LLC
(including all of the Member's voting rights, powers of appointment,
informational rights, Percentage Interest and Capital Account), (iii) the
counterparty to the transaction expressly acknowledges that it acquires its
rights in or against the interest subject to the terms of this Agreement (which
shall continue to govern) and such counterparty assumes in writing any
obligations of the selling Member from and after the date of such assumption
under this Agreement, (iv) reasonable assurances are provided to the remaining
Member that all monetary obligations hereunder of the selling Member prior to
the date of such assumption have been or will be satisfied, and (v) such
transaction would not result in a breach or default under any agreement to which
the LLC is a party or give rise to the right to accelerate the maturity of any
LLC indebtedness or result in any fees or penalties to the LLC (unless the
transferee or assignor indemnifies the LLC against such fees or penalties in a
manner reasonably satisfactory to the non-transferring Member or pays such fees
or penalties).
(b) No interest of any Member in the LLC or otherwise under this
Agreement shall be pledged, encumbered or hypothecated, except that a Member may
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pledge its entire interest in the LLC as security to a lender which has made a
loan or extended credit to the Member or the LLC.
8.2 Transfer of Riverboat Owner's License. A Member may sell its entire
interest in the LLC to any Person which simultaneously acquires or has acquired
a Certificate of Suitability or a Riverboat Owner's License issued by the
Commission for use adjacent to the LLC Property.
8.3 Invalid Transfers Void. Any purported sale, transfer, pledge,
encumbrance, hypothecation, grant of a security interest or assignment in
violation of this Agreement shall be void and of no force or effect and shall in
no way limit, modify, alter or impair the Members obligations under this
Agreement or create any rights on the part of the purported transferee, assignee
or creditor against the LLC or the other Member.
9. TERMINATION AND LIQUIDATION OF THE LLC.
9.1 Dissolution. The LLC shall be dissolved upon the occurrence of any
of the following events:
(a) December 31, 2035;
(b) The sale or other disposition of substantially all of the LLC's
assets;
(c) The written consent of all Members;
(d) The withdrawal, Bankruptcy or dissolution of any Member;
provided, however, that the LLC's existence shall not terminate if, within
ninety (90) days after such event, a majority in interest of the Members
(determined by reference to Percentage Interests) elects to continue the LLC's
existence, or
(e) Upon entry of a decree of judicial dissolution.
9.2 Winding-Up.
(a) Upon dissolution of the LLC, the Operating Committee shall
conclude the affairs of the LLC. The LLC's assets may be liquidated and
distributed in cash, or, if the Operating Committee unanimously so determines,
distributed in kind. To the extent such assets cannot either be sold without
undue loss or readily divided for distribution in kind to the Members, the LLC
may, as determined by the Operating Committee, convey those assets to a trust or
other suitable holding entity established for the benefit of the Members in
order to permit the assets to be sold without undue loss and the proceeds
thereof distributed to the Members at a future date. The legal form of the
holding entity, the identity of the trustee or, other fiduciary, and the terms
of its governing instrument shall be determined by the Operating Committee.
(b) Pursuant to the winding-up of the LLC, the LLC's assets shall
first be applied to the payment of, or to a reserve for the payment of, LLC
liabilities
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(including Cash Needs Loans and other debts to members and their Affiliates and
further including such provision for contingent or unforeseen liabilities as the
Operating Committee deems appropriate), and then shall be distributed to the
Members in accordance with their respective positive Capital Accounts after the
allocations pursuant to Sections 4.5 through 4.8 and after any distributions
pursuant to Section 4.9 for the then-current fiscal year. If assets are
distributed in kind, the assets so distributed shall be valued at their
then-current fair-market values and the unrealized appreciation or depreciation
in value of such assets shall be allocated to the Members' respective Capital
Accounts as if such assets had been sold, and such assets shall then be
distributed to the Members in accordance with their respective positive Capital
Accounts as so adjusted.
(c) A taking of all or substantially all of the LLC's property and
assets in condemnation or by eminent domain shall be treated in all respects as
a sale of the LLC's assets upon the dissolution and liquidation of the LLC
pursuant to this Section 9 in such event any portion of the property and assets
of the LLC not so taken shall be sold and the proceeds, together with the
condemnation award, distributed in the manner provided for in this Section 9.
(d) The amount by which the fair market value of any property to be
distributed in kind to the Members exceeds or is less than the basis of such
property (determined without regard to any election under Section 754 of the
Code) shall, to the extent not otherwise recognized to the LLC, be taken into,
account in computing gain or loss of the LLC for purposes of crediting or
charging the Capital Accounts of, and distributing proceeds to, the Members
under this Section 9.
(e) If, following the termination of the LLC, any asset of the LLC
is sold in a transaction in which, by reason of the provisions of Section 453 of
the Code, gain is realized but not recognized, such realized gain shall be taken
into account in computing gain of the LLC for the purposes of making allocations
under Section 9.2(b) hereof and distributions of proceeds to the Members under
Sections 9.2 hereof.
10. NOTICES.
10.1 Notices by Registered or Certified Mail.
(a) All notices, demands or requests provided for or permitted to
be given pursuant to this Agreement must be in writing. All notices, demands and
requests to be sent by any party hereto or to any other party shall be deemed to
have been properly given or served by depositing the same in the United States
Mail, postpaid and registered or certified, with return receipt requested, or by
delivering the same to an overnight delivery service of nationally recognized
standing, and addressed to the party to whom the notice, demand or request is
intended, at its address designated hereinbelow or to such other address as such
party may hereafter designate by written notice.
(b) All notices, demands and requests shall be effective upon being
deposited in the United States Mail or being delivered to an overnight delivery
service of nationally recognized standing. However, the time period in which a
response to any such
24
notice, demand or request must be given shall commence to run three (3) days
from the date of such mailing or two (2) days from the date of such delivery.
10.2 Routine Communications. Notwithstanding the foregoing, routine
communications, distribution checks, copies of financial statements, etc., may
be sent by ordinary first-class mail.
10.3 Notices to Xxxxx. Copies of all notices to Xxxxx shall be sent to
Xxxxxx X. Xxxxxx, Executive Vice President and General Counsel, Xxxxx Indiana,
Inc. c/o Trump Hotels & Casino Resorts, Inc., Xxxxx Xxxxxx & Xxxxxxxxxx
Xxxxxxxxx, Xxxxxxxx Xxxx, Xxx Xxxxxx 00000. Copies thereof shall concurrently be
sent to Xxxxx Xxxxxxx Xxxxxxxx, Esq., Xxxxxx, Xxxxxx & Xxxxxxxx, A Professional
Association, 0 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000-0000.
10.4 Notices to Xxxxxx. Copies of all notices to Xxxxxx shall be sent to
Xxx X. Xxxxxx, The Xxxxxx Companies, 000 Xxxxxxxxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000. Copies thereof shall concurrently be sent to Xxxxxxx X.
Xxxxxxx, Esq., Xxxxxx Xxxxxxx, PLLC, 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000-0000.
11. NO RIGHT TO OBLIGATE OR INCUR LIABILITIES FOR OTHER MEMBERS. Each of
the Members hereby covenants and agrees that it will not, during the term of
this LLC, do any act or incur any obligation on behalf of the LLC of any kind
whatsoever, except as herein expressly authorized and permitted in this
Agreement and each Member hereby agrees to indemnify and hold harmless the other
Members from any obligation or liability, including the reasonable expenses of
defense thereof, arising out of its breach of any of the provisions hereof.
12. COMPLIANCE WITH INDIANA GAMING REGULATIONS.
12.1 Transfer of LLC Interest. Notwithstanding anything to the contrary
contained in this Agreement, any sale, transfer, assignment or other conveyance
of all or any part of the interest (whether legal or beneficial) of any Member
in the LLC shall be subject to and conditioned upon, to the extent applicable,
the provisions of the Indiana Riverboat Gambling Act and the regulations of the
Commission.
12.2 Licensing. If it is determined by any agency or regulatory body or
by the provisions of any applicable law or regulation that the LLC or any Member
must be licensed or qualified in order to participate in the affairs and
ownership of the LLC, then each Member hereby agrees to cooperate reasonably and
promptly with the other in obtaining any and all licenses, permits or approvals
required by such governmental authority or deemed expedient by the Members in
connection with applicable law or regulation.
13. ARBITRATION.
13.1 Agreement to Arbitrate. Any controversy, dispute or claim arising
out of, in connection with, or in relation to the interpretation, performance or
breach of this Agreement shall be resolved by binding arbitration Rules (the
"Rules") of the American
25
Arbitration Association ("AAA"), specifically including the Rules relating to
"Expedited Procedures" (the "Expedited Procedures").
13.2 Selection of Arbitrators. Each party to the dispute shall by notice
to the other party name an arbitrator and the two (2) arbitrators so named shall
decide upon a third (3rd) arbitrator. The second (2nd) arbitrator to be
appointed must be appointed by notice to the party who appointed the first (1st)
arbitrator within fifteen (15) business days after the notice of the appointment
of the first (lst) arbitrator, failing which the first (1st) arbitrator so
appointed shall act as the sole arbitrator. If pursuant to the preceding two (2)
sentences, two (2) arbitrators have been appointed by the parties and if the two
(2) so appointed do not agree upon a third (3rd) arbitrator, the AAA in
Indianapolis, Indiana shall be requested to submit a list of five (5) persons to
serve as the third (3rd) arbitrator. The parties shall select the third (3rd)
arbitrator from the list submitted, provided that if the parties cannot agree
upon the third (3rd) arbitrator, then the third (3rd) arbitrator shall be
selected from the list of five (5) through the process of the two (2)
arbitrators jointly striking names from the list until one (1) name remains. The
decision of any two (2) of the arbitrators shall be final and binding upon all
parties. A judgment upon any award rendered by a majority of the arbitrators may
be entered and enforced in any court of competent jurisdiction. Unless the
arbitrators determine otherwise (which they shall have the right to do), all
costs and expenses of the arbitrators shall be borne equally by the parties with
the exception that the cost of the arbitrator selected by each party shall be
paid by the selecting party. The arbitrators shall be requested to render an
opinion within thirty (30) days after the date the controversy (within fifteen
(15) days in the case of any expedited proceeding) is submitted to them. The
above procedures contemplate that there will only be two (2) parties to the
arbitration proceeding; if there are more, and the parties cannot agree upon the
method of choosing arbitrators the method of proceeding shall be determined
pursuant to the then existing Commercial Arbitration Rules of the AAA.
13.3 Expenses. The arbitrator shall award to the prevailing party in any
arbitration proceeding commenced hereunder the prevailing party's costs and
expenses (including expert witness expenses and reasonable attorneys' fees but
excluding the cost of the arbitrator selected by the prevailing party) of
investigating, preparing and presenting such arbitration claim.
13.4 Expedited Procedures. Each party hereto hereby consents to the use,
of the Expedited Procedures without regard to the amount in controversy and
agrees to cooperate in all respects with the arbitrator in order to permit a
speedy resolution to such disputes. The arbitrator shall convene a hearing as
quickly as practicable after his or her appointment, and in any event no later
than fifteen (15) days after such appointment. There shall be only one hearing,
which shall not exceed five (5) consecutive business days in length.
13.5 Submission to Jurisdiction; Agent to Service. EACH OF THE PARTIES
HERETO CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN
THE CITY OF INDIANAPOLIS, STATE OF INDIANA, AND IRREVOCABLY AGREES THAT ALL
ACTIONS OR PROCEEDINGS RELATING TO THIS AGREEMENT OR ANY AGREEMENT OR INSTRUMENT
EXECUTED HEREUNDER, OTHER THAN ANY ACTION OR PROCEEDING REQUIRED BY SECTION
13(a) HEREOF TO BE SUBMITTED TO ARBITRATION, SHALL BE LITIGATED IN SUCH
26
COURTS, AND EACH OF THE PARTIES WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED ON
IMPROPER VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS
UPON IT, AND CONSENTS TO ALL SUCH SERVICE OR PROCESS MADE IN THE MANNER SET
FORTH IN SECTION 10 HEREOF. Nothing contained in this Section shall affect the
right of any party to serve legal process on any other party in any other manner
permitted by law. Nothing contained in this Section shall affect the obligations
of the parties with respect to the arbitration of disputes under Section 13.1
hereof.
13.6 Certain Decisions or Disputes Not Subject to Arbitration.
Notwithstanding anything to the contrary in the foregoing, the following
decisions or disputes shall not be subject to arbitration:
(a) any amendment to, renewal or extension of, or other change in
the terms and conditions of the Lease (if any);
(b) any decision by a Member to cause the LLC to enforce its rights
under the Lease (if any); and
(c) a change in the Site Plan that is not required in order to
complete the Site Plan Improvements (i) in a timely fashion or (ii) in
accordance with applicable laws, rules and regulations;
13.7 Certain Limitations on the Authority, of Arbitrators.
Notwithstanding Sections 13.1 and 13.2 above, the arbitrator(s) shall not have
the authority to determine that the Site Plan will include any improvements
(temporary or permanent) that cost more or are more extensive than the minimum
amount reasonably necessary to meet any contractual requirements undertaken by
the LLC.
14. MISCELLANEOUS.
14.1 Governing Law. The LLC is and shall be a limited liability company
existing under and governed by the laws of the State of Delaware.
14.2 Waivers. No consent or waiver, expressed or implied, by any Member
to or of any breach or default by the other of its obligations hereunder shall
be deemed or construed to be a consent or waiver to or of any other breach or
default in the performance by such other party of the same or any other
obligations of such member hereunder. Failure on the part of any Member to
complain of any act or failure to act of another Member or to declare a Member
in default, irrespective of how long such failure continues, shall not
constitute a waiver by such Member of its rights hereunder.
14.3 Severability. If any provision of this Agreement or the application
thereof to any person or circumstance shall be invalid or unenforceable to any
extent, the remainder of this Agreement and the application of such provisions
to other persons or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by law.
27
14.4 Covenant Against Partition. Except as otherwise provided in this
Agreement, the Members, on behalf of themselves, their legal representatives
successors and assigns, hereby specifically renounce, waive and forfeit all
rights whether arising under statute, or by operation of law, to seek, bring, or
maintain any action in any court of law or equity for partition of the Property,
or any interest which is considered to be LLC property, regardless of the manner
in which title to any such property may be held, and upon any breach of the
provisions of this Section 14.4, the other Member, in addition to all rights and
remedies in law and equity, shall be entitled to a decree or order restraining
or enjoining such application, action or proceeding.
14.5 Pronouns, etc. All pronouns or any variations thereof shall be
deemed to refer to the masculine, feminine, or neuter, singular or plural, as to
the identity of the person or persons may require.
14.6 Entire Agreement. This Agreement, together with other documents
being executed of even date, contain the entire agreement between the parties
hereto relative to the formation of the LLC. Each Member acknowledges that it is
not relying upon any statement or representation made by the other Member not
embodied herein or in the Exhibits attached hereto. No variations, modifications
or changes herein or hereof shall be binding upon any Member hereto unless set
forth in a document duly executed by or on behalf of such Member.
14.7 Binding Agreement; No Third Party Beneficiaries. Subject to the
restrictions on transfers and encumbrances set forth herein, this Agreement
shall inure to the benefit of and be binding upon the undersigned Members and
their respective legal representatives, successors and assigns. Whenever in this
instrument, a reference to any Member is made, such reference shall be deemed to
include a reference to the legal representatives, successors and permitted
assigns of such Member. However, in no event shall any third party be deemed to
be a third party beneficiary of this Agreement or otherwise be entitled to
enforce the terms and conditions of this Agreement against the Members.
14.8 Force Maieure. All obligations set forth in this Agreement shall be
subject to impossibility of performance as a consequence of any strike,
lock-out, fire, destruction, acts of God, restrictions of any governmental
authority, civil commotion or unavoidable casualty.
14.9 Captions; Exhibits. The captions used herein are for convenience
only and do not in any way affect, limit, amplify or otherwise modify the terms
and provisions hereof. The Exhibits attached hereto are a material part of this
Agreement and are hereby incorporated herein by reference.
14.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which as executed shall be deemed to be an original, but
all such counterparts shall constitute one and the same instrument.
14.11 Time of the Essence. Time is of the essence in the performance by
the Members of their obligations under this Agreement.
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14.12 Tax Matters Partner. Xxxxx shall be the Tax Matters Partner of the
LLC for all purposes under the Code, under the direction of the Operating
Committee. However, Xxxxx shall not cause the LLC to exercise any election
available to the LLC under the Code, or take any other action in such capacity,
without the prior written consent of the other
29
IN WITNESS WHEREOF, this Agreement is executed effective as of the date
first set forth above.
XXXXX INDIANA, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------------
Xxxxxx X. Xxxxxx, Executive Vice President
AMB PARKING, LLC
By: AMB Development, Inc.
By: /s/ Xxx X. Xxxxxx
--------------------------------------
Xxx X. Xxxxxx, President
30
EXHIBIT A
Construction Budget for Site Plan Improvements
------------------------------------------------- ------------------
Item Cost
(in thous)
------------------------------------------------- ------------------
Guaranteed Maximum Price Contract $ 16,072
------------------------------------------------- ------------------
Vehicle Overpass Ramp 3,000
------------------------------------------------- ------------------
Other 2,170
------------------------------------------------- ------------------
Contingency 1,000
-----
------------------------------------------------- ------------------
Total Construction Costs 22,242
------------------------------------------------- ------------------
Lease Cancellation & Land Purchase 15,000
------
------------------------------------------------- ------------------
Total Development Costs 38,442
------------------------------------------------- ------------------
Fees and Expenses 1,258
-----
------------------------------------------------- ------------------
Total Project Costs $ 38,500
======
------------------------------------------------- ------------------
EXHIBIT B
(Legal Description of BHPA Property)
PARCEL P I DESCRIPTION
A parcel of land in the Southeast Quarter of Fractional Section 23, Township 37
North, Range 9 West of the Second Principal Meridian, in the City of Xxxx, Lake
County, Indiana, more particularly described as follows:
Beginning at the Southerly corner of Xxxxxxxxxx Harbor Riverboats, L.L.C. Parcel
I as recorded in Document No. 95067683 in the Office of the Recorder of said
County;
1. thence North 35(degree)53'21" East along the southeasterly line of said
Parcel 1, a distance of 626.90 feet to the easterly corner of said Parcel
1;
2. thence North 54(degree)06'39" West, a distance of 289.37 feet along the
Northeasterly line of said Parcel 1 to a point on the Northwesterly line of
a parcel of patented land recorded in Lake County Deed Record 392, Page
312;
3. thence North 35(degree)53'21" East, a distance of 44.58 feet along the
Northwesterly line of said parcel;
4. thence South 54(degree)06'39" East a distance of 118.82 feet;
5. thence North 35(degree)53'21" East, a distance of 82.62 feet to the
Northeasterly line of a parcel of patented land recorded in Lake County
Deed Record 473, Page 29;
6. thence South 54(degree)06'39" East along said line a distance of 160.00
feet;
7. thence South 35(degree)53'21" West, a distance of 82.62 feet;
8. thence South 54(degree)06'39" East a distance of 410.65 feet;
9. thence South 35(degree)53'21" West, a distance of 551.21 feet to a point of
non-tangent curve;
10. thence 79.52 feet along an arc convex to the Northwest, said curve having a
radius of 94.22 feet, and subtended by a long chord which bears South
65(degree)28'30" West, a distance of 77.18 feet;
11. thence South 42(degree)41'33" West, a distance of 53.53 feet to the
Northeasterly right-of-way line of the Elgin, Joliet, & Eastern Railway
Company as recorded in Lake County Deed Record 117, Page 10;
12. thence North 54(degree)06'39" West, a distance of 355.66 feet along said
Northeasterly right-of-way line to the POINT OF BEGINNING, containing 6.678
acres, more or less.
PARCEL P2 DESCRIPTION
A parcel of land in the Southeast Quarter (SE 1/4) of Fractional Section
Twenty-three (23) and the Northeast Quarter (NE 1/4) of Section Twenty-Six (26),
Township Thirty-Seven North (T37N), Range Nine West (R9W) of the Second
Principal Meridian, in the City of Xxxx, Lake County, Indiana, more particularly
described as follows:
Beginning at the Northeasterly corner of Xxxxxxxxxx Harbor Riverboats, L.L.C.
Parcel 2 as recorded in Document No. 95067683 in the Office of the Recorder of
said County;
1) thence South 54(degree)06'39" East along the Southeasterly line of said
Parcel 4 of Exhibit A as recorded in Lake County Document No. 96052358 and
along the Southwesterly line of the Fourth (4th) parcel as described in
Lake County Deed Record 282, Page 248, a distance of 475.31 feet;
2) thence South 36(degree)02'19" West, a distance of 440.01 feet;
3) thence North 49(degree)38'51" West, a distance of 457.29 feet to the
Southeasterly line of said Parcel 2;
4) thence North 34(degree)13'33" East along said Southeasterly line, a
distance of 16.84 feet;
5) thence North 30(degree)46'03" East along said Southeasterly line, a
distance of 203.32 feet;
6) thence North 36(degree)00'21" East along said Southeasterly line, a
distance of 185.08 feet to the POINT OF BEGINNING, containing 4.548 acres,
more or less.
B-2
