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Exhibit 10.1
AGREEMENT TO TERMINATE MANAGEMENT AGREEMENT
THIS AGREEMENT is made as of this 31st day of March, 2000, between THE
TUNICA- BILOXI TRIBE OF LOUISIANA, a federally recognized Indian tribe (the
"Tribe"), whose address is X.X. Xxx 000, Xxxxxxxxxx, Xxxxxxxxx 00000, GRAND
CASINOS OF LOUISIANA, LLC- TUNICA-BILOXI, a Minnesota limited liability company
("GCI-LLC"), whose address is 000 Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxx 00000,
and LAKES GAMING, INC, a Minnesota corporation ("Lakes@), whose address is 000
Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxx 00000.
RECITALS
WHEREAS, the Tribe and Grand Casinos of Louisiana, Inc.--Tunica-Biloxi,
a Minnesota corporation ("Grand, Inc.") previously entered into that certain
Amended and Restated Management and Construction Agreement dated November 1,
1991 (the "Management Agreement), pursuant to which Grand, Inc. was initially
engaged and appointed as, among other things, the manager of the Tribe's gaming
enterprise; all capitalized terms used and but not otherwise defined herein
shall have the meanings ascribed thereto in the Management Agreement; and
WHEREAS, all rights and obligations of Grand, Inc. under the Management
Agreement and all related contracts and agreements with the Tribe were assigned
to and assumed by GCI- LLC pursuant to that certain assignment and assumption
agreement dated as of December 31, 1998 by and between Grand, Inc. and GCI-LLC,
which assignment and assumption was consented to by the Tribe; and
WHEREAS, Cottonport Bank ("Cottonport Bank") previously extended
certain financing to the Tribe pursuant to that certain Commercial Loan
Agreement dated March 17, 1997 (the "Hotel Loan Agreement"), pursuant to the
terms of which Cottonport Bank agreed to loan to the Tribe up to $16,500,000
(the AHotel Loan@) for the purposes of, among other things, to construct and
furnish a hotel facility and to purchase new gaming equipment, all as more fully
set forth therein; and
WHEREAS, in connection with such Hotel Loan, GCI-LLC and Lakes Gaming
have granted to the Bank certain guaranties dated as of February 15, 1999 and
Debt Subordination Agreements dated as of February 15, 1999, pursuant to which
(a) GCI-LLC and Lakes Gaming have guaranteed the Hotel Loan and the obligations
of the Tribe under the Hotel Loan Agreement, and (b) subordinated to the
Cottonport Bank all liabilities and other obligations owing by the Tribe to
either GCI-LLC or Lakes (respectively, the "Cottonport Guarantees" and the
"Cottonport Debt Subordinations"); and
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WHEREAS, Hibernia National Bank ("Hibernia Bank") previously extended
certain financing to the Tribe pursuant to that certain Commercial Loan
Agreement dated May 28, 1999 (the "Equipment Loan Agreement"), pursuant to the
terms of which Hibernia Bank agreed to loan to the Tribe up to $6,000,000 (the
"Equipment Loan") for the purposes of, among other things, to purchase new
gaming equipment, all as more fully set forth therein; and
WHEREAS, in connection with such Equipment Loan, GCI-LLC and Lakes
Gaming have granted to the Hibernia Bank certain Debt Subordination Agreements
dated as of May 28, 1999, pursuant to which GCI-LLC and Lakes Gaming have
subordinated to Hibernia Bank all liabilities and other obligations owing by the
Tribe to either GCI-LLC or Lakes (the "Hibernia Debt Subordinations"); and
WHEREAS, the Tribe, GCI-LLC and Lakes desire to terminate the
Management Agreement and all rights of GCI-LLC thereunder and to repay to
GCI-LLC all outstanding loans owing by the Tribe, all pursuant to the terms and
conditions set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual terms
and conditions set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Tribe, GCI-LLC
and Lakes agree as follows:
1. TERMINATION. The parties hereby mutually understand and agree that
upon the receipt by GCI-LLC and Lakes of the Termination Payment and the Related
Termination Documents, as hereinafter defined (the "Effective Date"), the
Management Agreement (except as otherwise provided in Sections 4 and 6 of this
Agreement) and all rights and obligations of GCI- LLC thereunder shall be deemed
terminated. As consideration for such termination, GCI-LLC shall receive a
payment from the Tribe calculated as of the Effective Date (assuming the
Effective Date occurs on the date of this Agreement) of $ 23,027,191.83 equal to
the sum of the following (collectively, the "Termination Payment"):
(a) an amount equal to $17,651,509.88 (representing the mutually
agreed upon fee for termination of the Management Agreement; and
(b) the amount of $27,514.38 (representing the outstanding general
accounts receivable owing by the Enterprise to GCI-LLC); and
(c) the amount of $5,348,167.57 (representing the sum of (1) the
aggregate outstanding principal balance of all loans owing by the
Tribe to GCI-LLC as of the date hereof equal to $5,305,325.25,
together with accrued interest of $42,842.32, with interest
accruing thereon at the rate of $1,465.25 per day).
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On the date hereof, the Termination Payment shall be wire transferred
to GCI-LLC pursuant to the following wire instructions:
Chase Manhattan Bank
New York, NY
ABA #000000000
For credit to Xxxxxxx Xxxxx
Account # 9301011483
For further credit to Lakes Gaming, Inc.
Account #000-00000-0
2. RELATED TERMINATION DOCUMENTS. On the date hereof, the Tribe has
obtained and shall deliver to GCI-LLC and Lakes the following documents
(collectively, the "Related Termination Documents"):
(a) Cottonport Bank Release. A written release from Cottonport Bank
in favor of GCI-LLC and Lakes releasing each of them from the
Cottonport Guarantees, the Cottonport Debt Subordinations and any
and all other obligations owed to Cottonport Bank with respect to
the Hotel Loan and the Hotel Loan Agreement, and which shall
otherwise be in form and substance acceptable to GCI-LLC and
Lakes; and
(b) Hibernia Bank Release. A written release from Hibernia Bank in
favor of GCI-LLC and Lakes releasing each of them from the
Hibernia Debt Subordinations and any and all other obligations
owed to Hibernia Bank with respect to the Equipment Loan and the
Equipment Loan Agreement, and which shall otherwise be in form
and substance acceptable to GCI-LLC and Lakes; and
(c) Certified Tribal Resolution. A resolution of the Tribal Council
of the Tribe authorizing the termination of the Management
Agreement, the execution, delivery and performance of this
Termination Agreement by the Tribe, and each of the terms and
provisions contained herein, which resolution shall be certified
by the Secretary of the Tribal Council as being true, correct,
complete and in full force and effect as of the date hereof.
3. LAND CONVEYANCE. In exchange for the agreements of the Tribe set
forth in this Agreement, GCI-LLC and Lakes agree to convey to the
Tribe
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contemporaneously with the occurrence of the Effective Date all
real property owned by such entities, if any, and located
adjacent to the Facility. Such conveyance shall be made at the
sole expense of the Tribe and on an "AS-IS" "WHERE-IS" basis,
without any representations or warranties whatsoever. GCI-LLC and
Lakes shall pay in full and shall hold the Tribe forever free and
harmless from the payment of any amount (including the Tribe's
reasonable attorneys' fees incurred in the defense of any claim
made against the Tribe) with respect to unpaid amounts owed on
that certain Cash Sale filed on December 29, 1992 at Entry No.
92-9253 of the records of the office of the Clerk of Court for
Avoyelles Parish.
4. CONTINUATION OF LITIGATION INDEMNITY AND INSURANCE PROVISIONS.
The parties hereto acknowledge and agree that notwithstanding
Section 1 of this Agreement, (a) the terms and provisions of
Section 5.8.2.4 of the Management Agreement, relating to
litigation indemnities among the Tribe, GCI-LLC and the
Enterprise, shall continue in full force and effect for any
applicable litigation currently existing or hereafter commenced
on or prior to the two (2) year anniversary of the Effective Date
(collectively, the "Subject Litigation") and shall thereafter
terminate with respect to the Subject Litigation at such time
that all Subject Litigation has been finally settled, dismissed
or satisfied and all rights to appeal by any party thereto have
been exhausted (the "Indemnity Termination Date"); and (b) the
terms of Section 12 of the Management Agreement (relating to the
maintenance of insurance by the Tribe and the Enterprise) shall
continue in full force and effect until the Indemnity Termination
Date. The Tribe further acknowledges and agrees that all claims
(including, without limitation, all litigation now or hereafter
commenced in connection therewith) listed on the attached "Grand
Casinos Avoyelles Guest Lost Damage Report" annexed hereto as
Exhibit A, shall constitute claims and litigation against the
Enterprise for purposes of Section 5.8.2.4 of the Management
Agreement and the same, including, without limitation, the costs
of defense thereof by the Tribe and/or GCI-LLC, shall constitute
"Operating Expenses" of and are to be paid by the Enterprise.
5. TRANSITION. The Tribe, GCI-LLC and Lakes agree to take all
reasonable steps necessary to insure a smooth transition to the
Tribe or any successor manager of all duties and responsibilities
of GCI-LLC under the Management Agreement. The Tribe agrees to
reimburse GCI-LLC and Lakes for
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any reasonable out-of-pocket expenses incurred in connection with
the turnover of any records and any other transition related
actions taken with prior notice to or made at the request of the
Tribe.
6. DISPUTE RESOLUTION. The Tribe, GCI-LLC and Lakes hereby
acknowledge and agree that with respect to the Tribe, on the one
hand, and GCI- LLC and Lakes on the other hand, the terms of
Sections 20, 22 and 23 of the Management Agreement relating to
the Tribe's limited waiver of sovereign immunity and submission
to jurisdiction and arbitration shall apply to the interpretation
and enforcement of the terms and conditions of this Agreement
(together with any provisions of the Management Agreement that
are to survive the Effective Date pursuant to the express terms
of this Agreement) as if fully set forth herein and are hereby
incorporated by reference.
7. MISCELLANEOUS. Each of the parties hereto agrees that upon
request of any other party, it shall execute and deliver such
additional agreements and documents as may be reasonably
necessary to effectuate the intents and purposes of this
Agreement. If it is ever determined that the approval of the
National Indian Gaming Commission or the Bureau of Indian Affairs
is required for the execution, delivery and performance of this
Agreement by the parties hereto, the Tribe, GCI-LLC and Lakes
agree to take all reasonable action necessary to obtain such
approval on the terms and conditions contained herein and to be
proponents of all of such terms. This Agreement shall be binding
on the Tribe, GCI-LLC and Lakes, and their respective successors
and assigns. This Agreement may be executed in counterparts, each
of which shall be considered an original and together shall
constitute one and the same instrument. If any provision of this
Agreement is prohibited by, or is unlawful or unenforceable
under, any applicable law of any jurisdiction, such provision
shall, as to such jurisdiction, be ineffective to the extent of
such prohibition without invalidating the remaining provisions
hereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
THE TUNICA-BILOXI TRIBE OF LOUISIANA,
By: /s/ Xxxx X. Xxxxxx, Xx.
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Xxxx X. Xxxxxx, Xx., Chairman
[SIGNATURE PAGE TO AGREEMENT TO TERMINATE MANAGEMENT AGREEMENT]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
GRAND CASINOS OF LOUISIANA,
LLC-TUNICA-BILOXI
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx, Chief Financial Officer
LAKES GAMING, INC.
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx, Chief Financial Officer
[SIGNATURE PAGE TO AGREEMENT TO TERMINATE MANAGEMENT AGREEMENT]
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EXHIBIT A
TO AGREEMENT TO TERMINATE MANAGEMENT AGREEMENT
(ATTACH COPY OF GRAND CASINO AVOYELLES GUEST LOST DAMAGE REPORT)
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