HILTON HOTELS CORPORATION CORPORATE SERVICES AGREEMENT
THIS HILTON HOTELS CORPORATION CORPORATE SERVICES
AGREEMENT (this "AGREEMENT"), dated ________, 1998, by and between HILTON
HOTELS CORPORATION, a Delaware corporation ("HILTON"), and GAMING CO., INC.,
a Delaware corporation and wholly owned subsidiary of Hilton ("GAMING CO.").
RECITALS
WHEREAS, pursuant to a Distribution Agreement dated _______, 1998 (the
"DISTRIBUTION AGREEMENT") between Hilton and Gaming Co., Hilton and certain of
its subsidiaries (the "RETAINED BUSINESS SUBSIDIARIES") will (i) contribute to
Gaming Co. and certain of its subsidiaries that conduct gaming business all of
the operations, assets and liabilities of Hilton and the Retained Business
Subsidiaries comprising the gaming business and (ii) distribute all of the
outstanding shares of Gaming Co.'s common stock to the holders of Hilton's
common stock;
WHEREAS, a condition of the closing of the transactions contemplated
by the Distribution Agreement is that Hilton and Gaming Co. enter into, among
other things, a corporate services agreement with substantially the same terms
and conditions set forth herein;
WHEREAS, Gaming Co. desires to retain Hilton as described herein, and
Hilton desires to render services as described herein for a fee; and
WHEREAS, the Board of Directors of each of Hilton and Gaming Co. have
determined that it is to the benefit and in the best interests of the respective
parties and their stockholders to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective
warranties, covenants and agreements set forth below, the parties agree as
follows:
AGREEMENT
1. DEFINITIONS.
For purposes of this Agreement, the following capitalized terms shall
have the meanings set forth below:
"ACCOUNTING PERIOD" shall be a one month period.
"ACTION" shall mean any action, claim, suit, arbitration, inquiry,
proceeding or investigation by or before any court, any governmental or other
regulatory or administrative agency or commission or any arbitration tribunal.
"CORPORATE SERVICES" shall mean the services described in Exhibit A.
"DISTRIBUTION" means the distribution to the holders of Hilton's
common stock of all the outstanding shares of Gaming Co.'s common stock.
"DISTRIBUTION DATE" means the date on which the Distribution is
effected.
"INITIAL TERM" shall have the meaning set forth in Section 2.
"LIABILITIES" shall mean any and all debts, liabilities and
obligations, absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising,
including all costs and expenses relating thereto, and including, without
limitation, those debts, liabilities and obligations arising under any law,
rule, regulation, Action, threatened Action, order or consent decree of any
governmental entity or any award of any arbitrator of any kind, and those
arising under any contract, commitment or undertaking.
"PRIME RATE" shall be the rate identified from time to time in the New
York edition of the Wall Street Journal as being the prime rate of interest;
should such rate be shown as a spread of rates, then the highest such rate shall
be utilized.
"RELATED AGREEMENTS" shall have the meaning described in the
Distribution Agreement.
Any capitalized terms defined in the Distribution Agreement and used
herein shall have the meanings ascribed to them in the Distribution Agreement
unless otherwise defined herein.
2. TERM. The initial term of this Agreement (the "INITIAL TERM")
shall commence on the Distribution Date and, unless earlier terminated pursuant
to this Section 2, shall expire on the date that is 12 months immediately
following the Distribution Date. After the Initial Term, unless earlier
terminated pursuant to this Section 2, the parties may agree to renew the term
of this Agreement for an extended period to be determined by the parties;
PROVIDED, HOWEVER, that the term of this Agreement shall not extend past the
date that is 18 months immediately following the Distribution Date.
Notwithstanding the foregoing, (a) Gaming Co. may terminate this Agreement or
any of the services provided by Hilton hereunder at any time for any reason or
no reason upon 60 days prior written notice to Hilton and (b) either party may
at any time terminate this Agreement in the event of a default (past the
expiration of any applicable cure period provided herein) in accordance with the
provisions of this Agreement; PROVIDED, HOWEVER, that the availability of such
right of termination shall not prejudice such party's right under Section 9
hereof.
3. SERVICES. Upon 30 days written request from Gaming Co., Hilton
shall provide to Gaming Co., to the extent requested in such notice, the types
of Corporate Services set forth in Exhibit A. The scope of the services to be
provided by Hilton hereunder shall be consistent with the scope of the services
being provided by the Retained Business Group to the Gaming Group on the date
the Merger Agreement is signed and shall not be expanded. Exhibit A may be
amended from time to time as the parties may mutually agree in writing.
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In the event that Hilton is required to retain, outside of the
ordinary course of business, outside consultant/contractor assistance to
perform any of the services hereunder, Hilton shall first obtain the written
consent of Gaming Co. to such retention (which consent may not be
unreasonably withheld). Hilton shall not be held responsible for the
performance of such consultant/contractor services and Gaming Co. assumes the
risk thereof.
4. COOPERATION. Gaming Co. will provide access to information
and its employees necessary for Hilton to provide such Corporate Services.
Gaming Co. shall, in a timely manner, take all such actions as may be
reasonably necessary or desirable in order to enable or assist Hilton to
provide the Corporate Services, including, but not limited to, providing
necessary information and specific written authorizations and consents, and
Hilton shall be relieved of its obligations hereunder to the extent that
Gaming Co.'s failure to take any such action renders performance by Hilton
unlawful or impracticable.
5. FEES AND PAYMENT. Gaming Co. shall pay Hilton for services
requested by and rendered to Gaming Co. hereunder as follows:
a. Fees for the Corporate Services for the Initial Term shall
be based on the fair value of such services based on an arm's length
negotiation between Hilton and Gaming Co. Fees for work performed by
outside consultants/contractors retained by Hilton outside of the ordinary
course of business shall be paid directly by Gaming Co. and shall not
include any xxxx-up or margins by Hilton.
x. Xxxxxx shall invoice Gaming Co. once each month for the
services performed during the prior month, other than services provided by
consultants/contractors outside of the ordinary course of business, which
services will be invoiced directly to Gaming Co. by such
consultants/contractors. Payment for all services hereunder, other than
services provided by consultants/contractors outside of the ordinary course
of business, shall be made by Gaming Co. to Hilton within 30 days of
receipt of invoice for payment (with appropriate supporting documentation
for any out-of-pocket expenses). Payment for services performed by
consultants/contractors outside of the ordinary course of business shall be
made promptly by Gaming Co. following Gaming Co.'s receipt of invoices for
such services. Any payments not made by Gaming Co. to Hilton when due
shall bear interest, computed daily, from the date due to the date of
payment based on the annual percentage rate equal to the Prime Rate, as the
same may vary from time to time, plus two percentage points.
c. If at any time during the term of the Agreement, Gaming Co.
moves its office location from 0000 Xxxxxx Xxxxxx Xxxxxxx, 0xx Xxxxx, Xxx
Xxxxx, Xxxxxx, both the availability of certain services and their
associated rates may be subject to change. If any additional services are
provided by Hilton, other than as set forth in the Exhibit attached hereto,
or if the scope or nature of the Corporate Services provided at any time
under this Agreement change materially, the parties hereto will negotiate
in good faith to set new fees based on the fair value of providing such
additional or revised services.
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d. Fees for Corporate Services provided after the Initial Term,
if any, shall be mutually agreed upon by the parties.
e. The parties agree that in the event that any tax or
assessment is required to be paid as a result of the provision of services
hereunder, other than any income tax (for which the party incurring such
expense shall be responsible), Gaming Co. shall be solely responsible for
the payment of such tax or assessment.
6. DUTY OF CARE.
x. XXXXXX'X OBLIGATIONS. All services provided and all
obligations hereunder shall be administered in accordance with Hilton's
standard policies, procedures and practices in effect as of the date hereof
and as may be changed from time to time, or as otherwise specified in
accordance with the terms hereof. In so doing, Hilton shall exercise the
same care and skill as it exercises in performing like services for itself.
In the event Hilton changes its policies, procedures or practices, the
Corporate Services performed hereunder may be modified by Hilton to meet
such revised policies, procedures and practices provided that Hilton gives
Gaming Co. prior written notice of such change and a reasonable opportunity
for Gaming Co. to adapt its operations to accommodate such changes or to
reject such change. Gaming Co.'s decision whether or not to accept the
proposed change must be made on or before the date Hilton implements such
change, which date shall be specified in the notice given to Gaming Co.
Gaming Co. agrees to pay any charges (i) resulting from Hilton's need to
maintain different versions of the same systems, procedures, technologies,
or services and (ii) resulting from requirements of third party vendors.
Notwithstanding anything to the contrary in this Section 6.a., Hilton's
liability for the provision of services hereunder shall be strictly
limited, as set forth in Section 9.
b. GAMING CO.'S OBLIGATIONS. Gaming Co. shall adopt reasonable
measures to limit its and Hilton's exposure with respect to any potential
losses and damages, including, but not limited to, periodic examination and
confirmation of results, provision for identification and correction of
errors and omissions, preparation and storage of backup data, virus
prevention, security, replacement of lost or mutilated documents, and
reconstruction of data.
7. LIAISON. Hilton shall appoint its Executive Vice President &
Chief Financial Officer, Executive Vice President & General Counsel, Senior
Vice President & Treasurer and Senior Vice President & Controller (the "HILTON
REPRESENTATIVES") and Gaming Co. shall appoint its Executive Vice President &
Chief Financial Officer, Executive Vice President & General Counsel, Senior Vice
President & Treasurer and Senior Vice President & Controller (the "GAMING CO.
REPRESENTATIVES" and, together with the Hilton Representatives, the
"REPRESENTATIVES") to facilitate communications and performance under this
Agreement. Each party may treat an act of a Representative of the other party
as being authorized by such other party without inquiring or ascertaining
whether such Representative had authority to so act. Each party shall have the
right at any time and from time to time to replace any of its Representatives by
giving prior notice in writing to the other party setting forth the name of (i)
each Representative to
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be replaced and (ii) the replacement, and certifying that the replacement
Representative is authorized to act for the party giving the notice in all
matters relating to this Agreement.
8. CONFIDENTIALITY.
x. Xxxxxx and Gaming Co. agree that all information regarding
the Corporate Services provided hereunder (the "CONFIDENTIAL INFORMATION"),
including, but not limited to, price, methods of operation and software,
shall be maintained in confidence and not be released to any third party
for any reason whatsoever, excluding such parties' counsel, agents,
auditors or lenders. However, a party may release the Confidential
Information to a third party upon the prior approval of the other party
(such approval not to be unreasonably withheld, conditioned or delayed),
upon court order or as such party in good faith believes, based on the
advice of counsel, is required by any rules, regulations or laws.
Notwithstanding the previous sentence, in the event that a party becomes
legally compelled (by deposition, interrogatory, request for documents,
subpoena, civil investigative demand or otherwise) to disclose any
information, such party shall provide the other with prompt prior written
notice of such requirement so that the other party may seek a protective
order or other appropriate remedy to minimize disclosure of the
Confidential Information. In the event that such protective order or other
remedy is not obtained, or the other party approves the disclosure, the
disclosing party agrees to furnish only that portion of the Confidential
Information which the disclosing party in good faith believes, based on the
advice of counsel, is legally required and to exercise reasonable efforts
to obtain assurance that confidential treatment will be accorded to such
information. Each party shall cease use of all Confidential Information
which any party has obtained from the other upon the expiration or earlier
termination of this Agreement. The provisions of this Section 8 shall
survive the expiration or earlier termination of this Agreement
b. Any Gaming Co. information or other information provided by
Gaming Co. to Hilton for use with the Corporate Services provided hereunder
and identified in writing as confidential shall remain the exclusive and
confidential property of Gaming Co. Specifically, Gaming Co.'s employee
database and payroll information shall be deemed confidential. Hilton
shall treat such information as confidential and will not disclose or
otherwise make available any Gaming Co. information to any person other
than employees, consultants, or auditors of Hilton with a need-to-know or
except as required by court order or as such party in good faith believes,
based on the advice of counsel, is required by any rules, regulations or
laws. Hilton will instruct its employees who have access to the Gaming Co.
information to keep the same confidential by using the same care and
discretion that Hilton uses with respect to its own confidential property
and trade secrets.
x. Xxxxxx will continue current security provisions regarding
third parties' access to Gaming Co. information. Hilton reserves the right
to issue and change regulations and procedures from time to time to improve
file security.
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x. Xxxxxx will continue current precautions regarding the loss
or alteration of Gaming Co. information. Gaming Co. will, to the extent it
deems necessary, keep copies of all source documents delivered to Hilton
and will maintain a procedure external to Hilton's systems for the
reconstruction of lost or altered Gaming Co. data.
x. Xxxxxx will, to the extent applicable, retain Gaming Co.'s
information in accordance with and to the extent provided by Hilton's then
prevailing records retention policies and practices for similar activities.
Hilton will, in conformity with its then prevailing records retention
policies and practices, dispose of all Gaming Co. information in any manner
it deems appropriate unless Gaming Co., prior to such disposal, furnishes
to Hilton written instructions for the disposition of such Gaming Co.
information, at Gaming Co.'s expense. At Gaming Co.'s request, Hilton will
provide Gaming Co., in a standard Hilton format and at Hilton's then
standard rates for such format, any and all Gaming Co. information
requested.
x. Xxxxxx'x systems used to perform the Corporate Services
provided hereunder, including but not limited to the payroll system, are
confidential and proprietary to Hilton or third parties. Gaming Co. shall
treat these systems and all related procedures as confidential and
proprietary to Hilton or its third party vendors and shall be directly
bound by and responsible for applicable license and other obligations.
Gaming Co. agrees that all software systems, procedures, and related
materials provided to Gaming Co. by Hilton for the purposes of this
Agreement are for Gaming Co.'s interim, revocable internal use exclusively
and only as related to the Corporate Services or any of the underlying
systems used to provide Corporate Services hereunder. Gaming Co. may not
sell, transfer, assign, or otherwise use the Corporate Services provided
hereunder, in whole or in part, for the benefit of any other party. Gaming
Co. shall not copy, modify, reverse engineer, or in any way alter these
systems without Hilton's express written consent. Title to all software
systems used in performing the Corporate Services provided hereunder shall
remain in Hilton or its third party vendors.
9. WARRANTIES AND LIMITATIONS OF LIABILITY.
x. XXXXXX DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE CORPORATE
SERVICES PROVIDED HEREUNDER. Hilton will use reasonable efforts to perform
the Corporate Services provided hereunder in a professional and workmanlike
manner, but the results of the Corporate Services are furnished "as is."
x. Xxxxxx shall have no liability to any third party in
connection with the provision of the Corporate Services in any event, and
no liability to Gaming Co. except to the extent (i) the performance of such
Corporate Services is in material breach of the standard of care specified
in this Agreement or (ii) the performance of such Corporate
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Services is interrupted, delayed or otherwise not available, PROVIDED,
HOWEVER, that in each case such liability shall be subject to Sections
9.e. and 13 hereof.
x. Xxxxxx'x sole liability to Gaming Co. for claims,
notwithstanding the form of such claims (e.g. contract, negligence or
otherwise), arising out of Section 9.b(i). above, shall be, at Gaming Co.'s
discretion, to (i) promptly perform again the particular Corporate Service
that was previously performed in breach of the standard of care specified
in this Agreement, at no additional cost to Gaming Co. or (ii) refund the
portion of the fees attributable to the performance of the Corporate
Service that was previously performed in breach of the standard of care
specified in this Agreement.
x. Xxxxxx'x sole liability to Gaming Co. for claims,
notwithstanding the form of such claims (e.g. contract, negligence or
otherwise), arising out of Section 9.b(ii). above, shall be to use all
reasonable efforts to make the Corporate Services available as promptly as
reasonably practicable. Hilton will maintain the same back-up procedures
for Gaming Co.'s information that Hilton has for its own similar
information.
e. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, (i) HILTON
SHALL NOT BE LIABLE FOR ANY ERRORS, OMISSIONS, DELAYS, OR LOSSES UNLESS
CAUSED SOLELY BY ITS CRIMINAL CONDUCT, FRAUD, BAD FAITH OR GROSS NEGLIGENCE
AND (ii) HILTON SHALL NOT BE LIABLE FOR INCIDENTAL, INDIRECT, SPECIAL, OR
CONSEQUENTIAL DAMAGES, INCLUDING LOSS OF PROFITS OR OTHER ECONOMIC DAMAGES.
GAMING CO. AGREES THAT IN NO EVENT SHALL THE TOTAL AGGREGATE LIABILITY OF
HILTON FOR ANY AND ALL CLAIMS, LOSSES, OR DAMAGES ARISING UNDER THIS
AGREEMENT AND FOR THE CORPORATE SERVICES PERFORMED HEREUNDER EXCEED THE
VALUE OF GAMING CO.'S PAYMENT FOR SAID SPECIFIC CORPORATE SERVICE IN
DISPUTE OVER ONE ACCOUNTING PERIOD'S TIME.
f. The foregoing provisions of this Section 9 set forth the
full extent of Hilton's liability hereunder (monetary or otherwise) for any
claim or action, regardless of the form in which any such claim or action
may be asserted against Hilton (e.g. contract, negligence or otherwise).
g. "Hilton" as used in this Section 9 includes all of Hilton's
affiliates, subsidiaries, vendors, service providers, licensors, licensees
and properties, and each of such entities' agents, officers, directors,
agents, employees, guests, residents, invitees, permitees, heirs,
executors, successors and assigns, related persons or entities (the "HILTON
INDEMNITEES").
10. DEFAULT. If either party materially defaults hereunder, the
non-defaulting party may terminate this Agreement effective immediately (subject
to the cure periods set forth below) upon written notice to the defaulting
party. The non-defaulting party shall be entitled to all remedies provided by
law or equity (including reasonable attorneys' fees and costs). The following
events shall be deemed to be material defaults hereunder:
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a. Failure by any party to make any payment required to be made
to the other hereunder or under an agreement related to the provision of
Corporate Services, which failure is not remedied within 5 days after
receipt of written notice thereof; or
b. Except as otherwise provided herein, failure by any party
substantially to perform in accordance with the terms and conditions of
this Agreement or under an agreement related to the provision of Corporate
Services, which failure is not remedied within 30 days after receipt of
written notice from the other party specifying the nature of such default;
or
c. (i) Filing of a voluntary bankruptcy petition by any party;
(ii) filing of an involuntary bankruptcy petition against any party which
is not withdrawn within 60 days after filing; (iii) assignment for the
benefit of creditors made by any party; or (iv) appointment of a receiver
for any party.
11. LAWS AND GOVERNMENTAL REGULATIONS. Gaming Co. shall be
responsible for (a) compliance with all laws and governmental regulations
affecting its business and (b) any use it may make of the Corporate Services to
assist it in complying with such laws and governmental regulations. While
Hilton shall not have any responsibility for Gaming Co.'s compliance with the
laws and regulations referred to above, Hilton agrees to use reasonable efforts
to cause the Corporate Services to be designed in such manner that they will be
able to assist Gaming Co. in complying with its applicable legal and regulatory
responsibilities as related to the Corporate Services. In no event, however,
will Gaming Co. rely solely on its use of the Corporate Services in complying
with any laws and governmental regulations.
12. INDEMNIFICATION.
a. Gaming Co. shall indemnify, defend and hold harmless each
Hilton Indemnitee from and against any and all losses, Liabilities, damages
and expenses (including, without limitation, the reasonable costs and
expenses of investigation and reasonable attorneys' fees and expenses in
connection with any or all such investigations or any and all Actions, or
threatened Actions) (collectively, "LOSSES") incurred or suffered by such
Hilton Indemnitee either (i) as the result of any claim made against such
Hilton Indemnitee by any third party arising out of such Hilton
Indemnitee's provision of the Corporate Services or (ii) arising out of
Gaming Co.'s negligence or malfeasance in connection with its use of the
Corporate Services.
b. The parties hereto are also subject to indemnification
provisions in the Distribution Agreement. The indemnification provisions
set forth herein are intended to supplement, but not to replace, the
indemnification provisions in the Distribution Agreement. To the extent
the indemnification provisions set forth herein conflict with those set
forth in the Distribution Agreement, those provisions that provide the
greatest benefits to the indemnified party shall control.
13. FORCE MAJEURE. Gaming Co. and Hilton shall incur no liability to
each other due to a failure to perform under the terms and conditions of this
Agreement resulting from fire,
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flood, war, strike, lock-out work stoppage or slow-down, labor
disturbances, power failure, major equipment breakdowns, construction
delays, accident, riots, acts of God, acts of United States' enemies,
laws, orders or at the insistence or result of any governmental
authority or any other event beyond each other's reasonable control. In
addition, Hilton shall not be liable or deemed to be in default for any
delay or failure to perform hereunder resulting, directly or indirectly,
from any cause beyond Hilton's reasonable control, including limitations
upon the availability of communications facilities or failures of Gaming
Co. or other communications equipment or failure of Gaming Co. to
prepare data properly for use in the Corporate Services.
14. RELATIONSHIP OF PARTIES. Nothing in this Agreement shall be
deemed or construed by the parties or any third party as creating the
relationship of principal and agent, partnership or joint venture between the
parties, it being understood and agreed that no provision contained herein, and
no act of the parties, shall be deemed to create any relationship between the
parties other than the relationship of buyer and seller.
15. ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by either of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other party. Subject to the preceding sentence, this Agreement
will be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns.
16. SPECIFIC PERFORMANCE. The parties hereto agree that the remedy
at law for any breach of this Agreement will be inadequate and that any party by
whom this Agreement is enforceable shall be entitled to specific performance in
addition to any other appropriate relief or remedy. Such party may, in its sole
discretion, apply to a court of competent jurisdiction for specific performance
or injunctive or such other relief as such court may deem just and proper in
order to enforce this Agreement or prevent any violation hereof and, to the
extent permitted by applicable laws, each party waives any objection to the
imposition of such relief.
17. HEADINGS; REFERENCES. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. All references herein to "Sections" or
"Exhibits" shall be deemed to be references to Sections hereof or Exhibits
hereto unless otherwise indicated.
18. SEVERABILITY; ENFORCEMENT. The invalidity of any portion hereof
shall not affect the validity, force or effect of the remaining portions hereof.
If it is ever held that any covenant hereunder is too extensive in any respect
to permit enforcement of such covenant to its fullest extent, each party agrees
that a court of competent jurisdiction may enforce such covenant to the maximum
extent permitted by law, and each party hereby consents and agrees that such
scope may be judicially modified accordingly in any proceeding brought to
enforce such covenant.
19. NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered personally, telecopied (which
is confirmed) or mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
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(a) if to Gaming Co., to
Gaming Co., Inc.
0000 Xxxxxx Xxxxxx Xxxxxxx
0xx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: General Counsel
Telecopy: 000-000-0000
with a copy to:
(b) if to Hilton, to
Hilton Hotels Corporation
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attn: General Counsel
Telecopy: 000-000-0000
with a copy to:
Xxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxx., X.X.
Xxxxx 0000
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxx Xxxxxxxxx, Esq.
Telecopy: 000-000-0000
20. FURTHER ACTION. Gaming Co. and Hilton each shall cooperate in
good faith and take such steps and execute such papers as may be reasonably
requested by the other party to implement the terms and provisions of this
Agreement.
21. WAIVER. Gaming Co. and Hilton each agree that the waiver of any
default under any term or condition of this Agreement shall not constitute any
waiver of any subsequent default or rights herein or nullify the effectiveness
of that term or condition. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party.
22. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of New York without regard to any
applicable conflicts of law.
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23. ENTIRE AGREEMENT; NO THIRD PARTY BENEFICIARIES. This Agreement,
including the Exhibits hereto, and the Distribution Agreement (including any
Ancillary Agreements, as such term is defined in the Distribution Agreement) and
including the Schedules and Exhibits thereto, constitute the entire
understanding between the parties, and supersede all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter covered by said agreements. To the extent that the terms of this
Agreement and similar terms of the Distribution Agreement or any Ancillary
Agreement are in conflict, the interpretation given to the conflicting terms of
the Distribution Agreement shall govern the interpretation and performance of
this Agreement. This Agreement is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.
24. AMENDMENT. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
25. ARBITRATION. The parties hereto agree that any dispute,
controversy or disagreement between the parties related to the obligations of
the parties under this Agreement in respect of which resolution cannot be
reached shall be submitted for mediation and final and binding arbitration in
accordance with Section 9.14 of the Distribution Agreement, including Section
9.14(c) thereof regarding the parties' ability to seek specific performance or
injunctive relief thereof, and including the attorneys' fees provisions referred
to therein.
26. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, Hilton and Gaming Co. have caused this Agreement
to be signed by their duly authorized officers as of the date first written
above.
HILTON HOTELS CORPORATION,
a Delaware corporation
By:
-----------------------------
Its:
-----------------------------
GAMING CO., INC.,
a Delaware corporation
By:
-----------------------------
Its:
-----------------------------
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EXHIBIT A
CORPORATE TREASURY SERVICES
Corporate Treasury Services shall include the maintenance of a cash management
system consisting of a concentration and controlled disbursement structure
(e.g., daily bank balance reporting, cash position settlement, ACH and
domestic/international wire transfers, the placement of investments, daily and
monthly accrual reporting, review of bank account fee analysis, maintenance of
account authorizations/corporate resolutions, debt administration, and the
establishment of a commercial paper program).
CORPORATE ACCOUNTING SUPPORT
Corporate Accounting Support shall include maintenance of general ledgers and
supporting financial records, preparation of journal entries (to include
supporting allocations and computations), monthly and year-end closings,
consolidation of Gaming Co. financial information, preparation of monthly
financial statements and reports, reconciliation of bank account and general
ledger account balances, assistance with external and internal audits, and
maintenance of applicable supporting records and documentation.
PAYROLL SERVICES
Payroll Services shall include payment of salaries and wages in accordance with
wage authorizations and time and attendance information provided by Gaming Co.,
depositing of amounts withheld from paychecks with appropriate taxing
authorities or other entity, filing of required payroll tax returns and reports,
issuance of W-2 forms, submission of required information and contributions to
third-party benefit plan record-keepers or plan administrators, and maintenance
of applicable supporting records and documentation.
ACCOUNTS PAYABLE SERVICES
Accounts Payable Services shall include issuance of payments to vendors and
other parties (including travel agent commissions) in accordance with
disbursement instructions received from Gaming Co., maintenance of applicable
vendor information, filing of required 1099 and other information returns, and
maintenance of applicable supporting records and documentation.
TAX SERVICES
Tax Services shall include preparation of federal and state income tax returns
(including determination of estimated tax payments and preparation of any
required extension requests), filing of state annual reports, assistance with
property tax assessments and appeals, assistance with income, sales and use tax
audits as required, and tax consultation services as requested.
A-1
BENEFITS ADMINISTRATION SERVICES
Benefits Administration Services shall include marketing, negotiation, and
placement of group insurance programs (including medical, dental, life, and
disability coverages), collection and submission of participant and premium
information to providers, development of premium allocations, submission of
employee demographic information and contributions to 401-k, stock purchase
plan, and executive deferred compensation plan record-keepers or administrators,
coordination of annual plan discrimination testing, filing of required
government reports (to include plan 5500's), approval of employee withdrawals
from plans as required, determination of retirement benefits payable under
qualified and non-qualified plans, and maintenance of applicable plan accounting
and administrative information.
RISK MANAGEMENT SERVICES
Risk Management Services shall include marketing, negotiation and placement of
insurance coverages as directed by Gaming Co., assembling historical loss
information and renewal information, evaluation and negotiation of proposals,
premiums and coverages with brokers and underwriters, review of insurance
provisions of proposed contracts, procurement of surety bonds, preparation of
reports required by state insurance regulatory agencies, issuance of required
insurance certificates, coordination of actuarial reviews of outstanding
liabilities, monitoring of claims, development of premium allocation
information, retrospective premium adjustments, and maintenance of applicable
supporting records and documentation.
CLAIM ADMINISTRATION SERVICES
Claim Administration Services shall include administration of workers
compensation and liability claims covered under Gaming Co.'s self-insurance
programs, investigation, resolution and settlement of such claims in accordance
with guidelines provided by Gaming Co., issuance of payments to providers and
employees in accordance with state self-insurance regulations, issuance of
payments to indemnity claimants in accordance with settlement agreements, filing
of applicable reports with state insurance regulatory agencies, and maintenance
of applicable accounting and claim information and documentation.
ARCHITECTURAL AND CONSTRUCTION MANAGEMENT SERVICES
The scope and cost of such services are to be negotiated by Hilton and Gaming
Co. and shall be governed by a separate agreement entered into by such parties.
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