MANAGEMENT AGREEMENT
FOR THE
XXXXXX'X-PLAYERS RIVERSIDE COMPLEX
BY AND BETWEEN
RIVERSIDE JOINT VENTURE
AND
XXXXXX'X MARYLAND HEIGHTS OPERATING COMPANY
Dated: November 2, 1995
MANAGEMENT AGREEMENT
TABLE OF CONTENTS
Page
----
ARTICLE 1
DEFINITIONS............................................................................................ 1
1.1 Definitions.......................................................................... 1
ARTICLE 2
SCOPE OF AGREEMENT..................................................................................... 14
2.1 Subject Matter....................................................................... 14
2.2 Development.......................................................................... 14
2.3 Grant and Acceptance of Management Responsibility.................................... 14
2.4 Funding.............................................................................. 14
ARTICLE 3
TERM................................................................................................... 14
3.1 Term................................................................................. 14
ARTICLE 4
COVENANTS OF OWNER..................................................................................... 15
4.1 Licensing and Permitting............................................................. 15
4.2 Title/Quiet Enjoyment................................................................ 16
ARTICLE 5
PRE-OPENING............................................................................................ 16
5.1 Pre-Opening Budget................................................................... 16
5.2 Payment of Pre-Opening Expenses...................................................... 16
5.3 Pre-Opening Hiring and Training of Employees......................................... 17
5.4 Pre-Opening Inspection............................................................... 17
5.5 Opening.............................................................................. 17
ARTICLE 6
STANDARDS AND MANAGER'S CONTROL........................................................................ 18
6.1 Xxxxxx'x Operational Standards....................................................... 18
6.2 Manager's Obligations................................................................ 18
6.3 Owner's Obligations.................................................................. 20
6.4 Manager's Control.................................................................... 21
ARTICLE 7
OPERATION OF THE ENTERTAINMENT FACILITY................................................................ 21
7.1 Permits.............................................................................. 21
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7.2 Equipment and Supplies............................................................... 21
7.3 Employees............................................................................ 21
7.4 Marketing and Advertising............................................................ 23
7.5 Maintenance and Repairs.............................................................. 23
7.6 Capital Replacements/Improvements.................................................... 24
7.7 Emergency Expenditures............................................................... 24
7.8 Compliance with Legal Requirements................................................... 24
ARTICLE 8
FISCAL MATTERS......................................................................................... 25
8.1 Accounting Matters and Fiscal Periods................................................ 25
8.2 Operating Budget/Annual Plan......................................................... 26
8.2.1 Fiscal Authority and Constraint............................................. 26
8.2.2 Food and Beverage Pricing/Advertising and Marketing......................... 26
8.2.3 Compliance.................................................................. 26
8.2.4 Adjustment to Annual Plan................................................... 27
8.3 Bank Accounts........................................................................ 28
ARTICLE 9
FEES TO MANAGER........................................................................................ 29
9.1 Management Fees...................................................................... 29
9.1.1 Base Management Fee......................................................... 29
9.1.2 Incentive Management Fee.................................................... 29
9.1.3 Payment..................................................................... 30
9.2 Accounting Fee....................................................................... 30
ARTICLE 10
DISBURSEMENTS.......................................................................................... 30
10.1 Priority of Disbursements............................................................ 30
10.2 Adjustment to Bank Account........................................................... 30
10.3 Payment of Ownership Costs........................................................... 30
10.4 Payment of Sales and Other Operational Taxes......................................... 31
ARTICLE 11
XXXXXX'X SERVICES...................................................................................... 31
11.1 Nature of Services................................................................... 31
ARTICLE 12
SYSTEM XXXX SIGNS AND SYSTEM MARKS..................................................................... 32
12.1 Signs................................................................................ 33
12.2 Xxxxxx'x System Marks................................................................ 33
12.3 Litigation........................................................................... 34
12.4 Players' System Marks................................................................ 34
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ARTICLE 13
INSURANCE.............................................................................................. 35
13.1 Insurance Coverage................................................................... 35
13.2 Failure to Obtain - Self Help........................................................ 35
ARTICLE 14
INDEMNITY AND RELATED MATTERS.......................................................................... 35
14.1 Scope................................................................................ 35
14.2 Defense.............................................................................. 36
ARTICLE 15
DAMAGE TO AND DESTRUCTION OF THE ENTERTAINMENT FACILITY................................................ 37
15.1 Obligation to Restore................................................................ 37
15.2 Termination Option................................................................... 37
ARTICLE 16
CONDEMNATION........................................................................................... 38
16.1 Termination.......................................................................... 38
16.2 Restoration and Continuation......................................................... 39
ARTICLE 17
DEFAULT AND TERMINATION................................................................................ 39
17.1 Events of Default.................................................................... 39
17.2 Termination/Damages.................................................................. 41
ARTICLE 18
NOTICES................................................................................................ 43
18.1 Procedure............................................................................ 43
ARTICLE 19
RELATIONSHIP, AUTHORITY AND FURTHER ACTIONS............................................................ 44
19.1 Relationship......................................................................... 44
19.2 Contractual Authority................................................................ 44
19.3 Further Actions...................................................................... 44
ARTICLE 20
APPLICABLE LAW AND ARBITRATION......................................................................... 44
20.1 Scope................................................................................ 44
20.2 Arbitration.......................................................................... 45
20.2.1 Matters Subject to Arbitration.............................................. 45
20.2.2 The Accountants............................................................. 45
20.2.3 Arbitration Procedures...................................................... 46
ARTICLE 21
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SUCCESSORS AND ASSIGNS.......................................................................................... 46
21.1 Assignment by Manager................................................................ 47
21.2 Assignment or Transfer of Title by Owner............................................. 47
21.3 Binding Effect....................................................................... 48
ARTICLE 22
SHORT FORM OF AGREEMENT......................................................................................... 48
22.1 Memorandum of Agreement............................................................. 48
ARTICLE 23
FORCE MAJEURE................................................................................................... 48
23.1 Operation of Entertainment Facility.................................................. 48
23.2 Extension of Time.................................................................... 48
ARTICLE 24
TERMINATION..................................................................................................... 49
24.1 Surviving Obligations................................................................ 49
24.2 Termination/Expiration............................................................... 49
ARTICLE 25
GENERAL PROVISIONS.............................................................................................. 53
25.1 Authorization........................................................................ 53
25.2 Interest............................................................................. 53
25.3 Formalities.......................................................................... 53
25.4 Documents............................................................................ 53
25.5 Personal Service Contract............................................................ 53
25.6 Exhibits............................................................................. 53
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TABLE OF EXHIBITS
EXHIBIT A
Current Form of Operating Statement
EXHIBIT B
Permitted Exceptions
EXHIBIT C
Owner's Insurance Requirements
EXHIBIT X
Xxxxxx'x Financial Reporting and Accounting Policies Manual
EXHIBIT E
Short Form of Management Agreement
EXHIBIT F
Irrevocable Banking Instructions
EXHIBIT G
Pre-Opening Budget
EXHIBIT H
Variable Expenses
EXHIBIT I
Pre-Opening Account Funding Schedule
EXHIBIT J
Entertainment Facility Allocation Policies
EXHIBIT K
Xxxxxx'x Operational Standards
EXHIBIT L
Key Personnel
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MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT ("Agreement") is made and entered into as of the
2nd day of November, 1995, by and between RIVERSIDE JOINT VENTURE, a Missouri
general partnership (hereinafter referred to as "Owner"), and XXXXXX'X MARYLAND
HEIGHTS OPERATING COMPANY, a corporation organized and existing under the laws
of the State of Nevada, with principal offices at 000 Xxxxx Xxxxxx Xxxxxx, Xxxx,
Xxxxxx (hereinafter referred to as "Manager");
WITNESSETH:
WHEREAS, Owner is desirous of having Manager operate Owner's Entertainment
Facility to be constructed on the Site; and
WHEREAS, Manager is desirous of operating the Entertainment Facility;
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, Owner and Manager agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. As used herein the following terms shall have the
respective meanings indicated below:
(a) Accountants - the accounting firm selected pursuant to Article
20.2.2 of this Agreement.
(b) Accounting Fee - as defined in Article 9.2.
(c) Adjusted Gross Revenues - Gross Revenues less:
(i) any gratuities or service charges added to a customer's
xxxx;
(ii) any credits or refunds made to customers, guests or
patrons, provided that any refunds made pursuant to
invocation of Xxxxxx'x 100% guaranty by any customer of
the Entertainment Facility shall be an Operating Cost
rather than an adjustment to Gross Revenues;
(iii) any sums and credits (other than those already
excluded from Gross Revenues) received by Owner for
lost or damaged merchandise;
(iv) any sales taxes, excise taxes, use taxes, gross
receipts taxes, admission taxes, entertainment taxes,
tourist taxes or charges, and similar charges required
by law to be collected from patrons or guests or as
part of the sale price for goods, services or
entertainment which must be remitted to governmental
authorities;
(v) any proceeds from the sale or other disposition of the
Entertainment Facility, Furnishings and Equipment or
other assets;
(vi) any fire and extended coverage insurance proceeds or
other insurance proceeds payable in connection with any
casualty loss (except for business interruption,
increased cost of operations, use, occupancy or similar
insurance proceeds);
(vii) any condemnation awards (except awards for temporary
takings [i.e., condemnations of twelve (12) months or
less]); and
(viii) any proceeds of financing or refinancing of the
Entertainment Facility.
(d) Annual Plan - the Annual Plan adopted by Owner pursuant to Section
7(l) of Owner's Partnership Agreement, as modified from time to time.
(e) Architect - Xxxxxxxxxx, Xxxxxx & Xxxxxxxx, Inc.; 000 Xxxx Xxxxxxx
Xxxxxx, Xxxxx 000; Xxxxxx Xxxx, Xxxxxxxx, 00000.
(f) Authorized Mortgage - mortgage(s), deed(s) of trust, security
agreements, or other forms of agreements securing payment of
indebtedness, the proceeds of which are used solely to construct,
improve, restore, or repair the Entertainment Facility, with a lien or
equivalent security interest against the Entertainment Facility.
(g) Bank Account(s) - as defined in Article 8.3(a).
(h) Base Management Fee - as defined in Article 9.1.1.
(i) Building - all buildings, structures and improvements to be located on
the Site and all fixtures and equipment attached to, forming a part of
and necessary for the operation of such buildings, structures and
improvements as a hotel having 300 guest rooms, more or less, each
with bath, and entertainment complex (including,
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without limitation, heating, lighting, sanitary, air-conditioning,
laundry, refrigeration, kitchen, elevator and similar items), and all:
(i) restaurants, bars, banquet, meeting and other public areas;
(ii) commercial space, including concessions and shops;
(iii) storage and service areas; (iv) health club facilities;
(v) parking facilities;
(vi) office facilities;
(vii) permanently affixed signage; and
(viii) other buildings, facilities and appurtenances, as may
now or hereafter, replace, be attached to and form a part of
the Building or otherwise be located on the Site;
but excluding:
(i) the Excursion Gambling Boats; and
(ii) the Excursion Gambling Support Facilities.
(j) Capital Replacement - any alteration or addition to, or rebuilding or
renovation of the Building, including any addition to and replacement of
Furnishings and Equipment, the cost of which is capitalized and amortized,
rather than being expensed.
(k) Compensation - the direct salaries and wages paid to, or accrued for the
benefit of any employee, including incentive compensation, together with
all fringe benefits payable to or accrued for the benefit of such executive
or other employee, including employee meals, employer's contribution under
F.I.C.A., unemployment compensation or other employment taxes, pension fund
contributions, workers' compensation, group life, accident and health
insurance premiums and costs, and profit sharing, severance, retirement,
disability and other similar benefits. It is anticipated that: (i) Manager
will lease employees to Xxxxxx'x (LLC) (which, as tenant under an Operating
Lease, will operate Excursion Gambling Boats and Excursion Gambling Boat
Support Facilities); (ii) certain employees will perform
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services for both the Entertainment Facility and such Excursion
Gambling Boats and Excursion Gambling Boat Support Facilities ("Shared
Employees"); and (iii) the Compensation line item of each Operating Budget
will include an allocated portion of Compensation of Shared Employees. If
Owner determines that the use of Shared Employees is not cost effective, it
shall be entitled, by written notice to Manager, effective ninety (90) days
after the date of its receipt, to have all employees of the Entertainment
Facility, work solely at the Entertainment Facility, and all employees of
the Excursion Gambling Boat(s) and Excursion Gambling Boat Support
Facilities operated by Xxxxxx'x (LLC) work solely thereat. In such event:
(i) the Operating Budget for the Fiscal Year within which such change is
effected shall, without the need for further approval by Owner, be
automatically increased to include additional Compensation occasioned by
the elimination of sharing of Shared Employees; and (ii) any administrative
or supervisory services performed jointly for the Entertainment Facility
and such Excursion Gambling Boats shall thereafter be an Administrative
Service Fee established under Article 11.1(a), and Owner shall, in the
event of a dispute, be entitled, by notice to Manager given, within ten
(10) days after notice from Manager to Owner of any such Operating Budget
increase, to arbitrate under Article 20.2 both: (i) the reasonableness of
Manager's determination of (x) the number and (y) Compensation of
additional employees required to exclusively serve the Entertainment
Facility; and (ii) the reasonableness of the amount of any Administrative
Service Fee established under Article 11.1(a).
(l) Completion - the date upon which Manager receives (i) an architect's
certificate from the Architect or any replacement architect having
responsibility for the supervision of construction, equipping and
furnishing of the Entertainment Facility and the connection of the
Excursion Gambling Boats thereto, certifying that the Entertainment
Facility, Excursion Gambling Boats and Excursion Gambling Support
Facilities, including all private and public areas, have been fully
constructed, substantially in accordance with the Plans and Specifications;
(ii) a
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permanent or temporary certificate of occupancy from the government
authority or authorities pursuant to whose jurisdiction the Entertainment
Facility and Excursion Gambling Boats and Excursion Gambling Support
Facilities have been constructed, permitting the use and operation of all
portions of the Entertainment Facility, Excursion Gambling Boats and
Excursion Gambling Support Facilities in accordance with this Agreement;
and (iii) certificates of such professional designers, inspectors or
consultants or opinions of counsel, as Manager may determine to be
appropriate, verifying construction and furnishing of the Entertainment
Facility, Excursion Gambling Boats and Excursion Gambling Support
Facilities in compliance with all Legal Requirements. The qualification of
the Entertainment Facility as "Complete" shall not limit the obligation of
Owner to complete any items or correct any deficiencies noted by the
Architect or Manager at the time of Pre-Opening Inspection, or thereafter
discovered.
(m) Defaulting Party - as defined in Article 17.1.
(n) Deficiencies - any failure: (i) of the Entertainment Facility, Excursion
Gambling Boats and/or Excursion Gambling Support Facilities to be
constructed in substantial compliance with the Plans and Specifications; or
(ii) of the hotel portion of the Building to be equipped with Furnishings
and Equipment, Operating Equipment or Operating Supplies that comply with
Xxxxxx'x Operational Standards.
(o) Department - those general divisional categories shown in the Annual Plan
(e.g. rooms department or food department), but shall not mean or refer to
the subcategories (e.g. linen replacement and uniforms) appearing in each
such divisional category.
(p) Development Period - the period between the Effective Date and the Opening
Date.
(q) Effective Date - November 3, 1995.
(r) Emergency - any condition or state of affairs involving any of the
following, or the imminent threat of any of the following: (i) personal
injury to a significant
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number of the guests or employees of the Entertainment Facility; (ii)
damage to or destruction of the structural integrity and/or function of the
Entertainment Facility, or any material portion thereof or system therein;
and (iii) closure of the Entertainment Facility or any material portion
thereof by any governmental agency or authority. An Emergency shall
automatically terminate upon the termination or resolution of such actual
or threatened condition(s).
(s) Entertainment Facility - a collective term for the Site, the Building, the
Furnishings and Equipment, the Operating Equipment and the Operating
Supplies.
(t) Event of Default - as defined in Article 17.1.
(u) Excursion Gambling Boats - the boats, ferries or other floating facilities
located adjacent to or within the Building (including, without limitation,
the Excursion Gambling Boat Support Areas) and licensed by the Missouri
Gaming Commission (or its successor) for the conduct of gambling games (as
defined from time to time by Mo.R.S.ss.ss.313.800, et seq.). There shall be
two (2) Excursion Gambling Boats on the Site, one operated by Players (or
its permitted assignee), and one operated by Manager (or its permitted
assignee); both under lease from Owner pursuant to an Operating Lease.
(v) Excursion Gambling Support Facilities - those portions of the Building set
aside for use as: (i) a gift shop; (ii) offices; (iii) a ticketing
facility; or (iv) a specialty restaurant, serving each of the Exclusion
Gambling Boats, and separately leased to the owners pursuant to an
Operating Lease.
(w) Fiscal Period, Fiscal Month, Fiscal Quarter, Fiscal Year - as defined in
Article 8.1(c).
(x) Furnishings and Equipment - all furniture, furnishings and equipment
(excepting Operating Equipment) required for the operation of the
Entertainment Facility in accordance with the standards set forth in this
Agreement, including, without limitation:
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(i) guestroom furnishings and equipment such as beds, bureaus, mirrors,
desks, televisions, chairs, sofas and other items required by Xxxxxx'x
Operational Standards;
(ii) office furnishings and equipment;
(iii) specialized equipment necessary for the operation of any portion of
the Building as an Entertainment Facility, including equipment for
kitchens, laundries, dry cleaning facilities, cocktail lounges,
restaurants, public rooms, commercial and parking facilities, and
recreational facilities; and
(iv) all other furnishings and equipment hereafter located and installed in
or about the Building which are used in the operation of the Building
as a hotel in accordance with the standards set forth in this
Agreement.
(y) Gross Revenues - all revenues and income of any nature derived directly or
indirectly from the Entertainment Facility or from the use or operation
thereof, including without limitation room sales, food and beverage sales,
telephone, telegraph, satellite or cable video and telex revenues, gift
shop sales, parking sales, and the actual cash proceeds of business
interruption, increased cost of operation, use, occupancy or similar
insurance.
(z) Ground Lease - that certain ground lease of a portion of the Site
(described therein) by and between Xxxxxx'x (LLC) and Owner dated November
3, 1995, to be evidenced by a short form of ground lease to be recorded in
the public records of St. Louis County, Missouri.
(aa) Xxxxxx'x (LLC) - Xxxxxx'x Maryland Heights LLC, a Delaware limited
liability company.
(ab) Xxxxxx'x (Maryland) - Xxxxxx'x Maryland Heights Corporation, a Nevada
corporation.
(ac) Xxxxxx'x Operational Standards - those rules of operation and other
operational standards and policies, all as may be amended or modified from
time to time by Manager, which are applied to the operation of hotels and
entertainment facilities in the Xxxxxx'x System. Xxxxxx'x Operational
Standards currently in effect for the
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Entertainment Facility are attached as Exhibit K. Certain of Xxxxxx'x
Operational Standards, designated as "Minimum Standards" on Exhibit K (the
"Minimum Standards"), shall not be reduced to a lesser standard of quality
or quantity, as the case may be, than is set forth in Exhibit K.
Modifications of Xxxxxx'x Operational Standards shall be advised to Owner
no less than thirty (30) days before they become effective. Any Furnishings
and Equipment, Operating Equipment or Operating Supplies specified by
Manager for inclusion in the Entertainment Facility shall be deemed, while
in new condition, to comply with Xxxxxx'x Operational Standards then in
effect. The interpretation and application of Xxxxxx'x Operational
Standards by Manager shall be binding upon Owner for all purposes unless
arbitrary or capricious. Xxxxxx'x Operational Standards shall be adopted
and amended for all hotels in the Xxxxxx'x System of like character and
market on a non-discriminatory basis.
(ad) Xxxxxx'x Services - as defined in Article 11.
(ae) Xxxxxx'x System - a collective term for the services provided to the public
by Harrah's Las Vegas, a Nevada corporation, and Manager's Affiliates,
through operation or license of facilities under the name Xxxxxx'x(R).
(af) Harrah's System Marks - the name and xxxx Xxxxxx'x(R), and all other
service marks, trademarks, copyrights, tradenames, patents or similar
rights or registrations now or hereafter held or applied for in connection
therewith.
(ag) Hotel Revenues - Adjusted Gross Revenues derived from room sales and sales
of telephone, telegraph, satellite or cable video and telex, room service
or other incidental charges incurred by hotel guests and charged to their
hotel room folio.
(ah) Impositions - shall mean and include:
(i) all ad valorem taxes, water and sewer use charges or assessments,
stand pipe charges and assessments, or other charges or assessments
imposed upon the real and personal property comprising the
Entertainment Facility; and
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(ii) any other charge or assessment imposed by governmental or quasi
governmental authority or by any other entity empowered by law to
assess charges against the Entertainment Facility, with or without
lien rights for the enforcement thereof, including, without
limitation: (A) regular and special assessments payable to the Xxxxxx
Bend Levee District for administration, maintenance and improvement of
levees; and (B) special assessments payable to the City of Maryland
Heights for the payment of annual principal and interest on bonds
issued to finance extension of the Earth City Expressway.
(ai) Incentive Management Fee - as defined in Article 9.1.2
(aj) Index - the Consumer Price Index for All Urban Consumers published by the
Bureau of Labor Statistics of the United States Department of Labor, U.S.
City Average, all items, (1982-84=100), or any successor or replacement
index thereto. If the Index shall, after the date hereof, be converted to a
different standard reference base or shall otherwise be revised, any
determination hereunder which uses the Index shall be made with the use of
such conversion factor, formula or table for converting the Index as may be
published by the Bureau of Labor Statistics, or, if said Bureau shall not
publish the same, then with the use of such conversion factor, formula or
table as may be published by Prentice Hall, Inc., or, failing such
publication, by any other nationally recognized publisher of similar
statistical information. If the Index shall cease to be published, then for
the purpose of this Agreement there shall be substituted for the Index such
other similar index as Manager shall reasonably determine which measures
changes in the relative purchasing power of United States currency over the
term of this Agreement.
(ak) Institutional Investor or Institutional Lender - an Institutional Investor,
as defined in Owner's Partnership Agreement.
(al) Interest Rate - the Prime Rate as defined in Owner's Partnership Agreement.
(am) Key Personnel - as defined in Article 5.3.
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(an) Legal Requirements - as defined in Article 7.8.
(ao) Licenses and Permits - as defined in Article 4.1.
(ap) Management Fee(s) - as defined in Article 9.1.
(aq) Manager's Affiliate - Xxxxxx'x Entertainment, Inc., and any of its direct
or remote wholly-owned subsidiaries, determined at the time of application
of the contract provision using this term.
(ar) Minimum Balance - the amount of cash which Manager, from time to time,
determines to be necessary to pay estimated Operating Costs of the
Entertainment Facility for each such succeeding Fiscal Month during the
Term, plus any reserves that Manager determines to be necessary to pay
Operating Costs (or Ownership Costs paid by Manager under this Agreement)
that are paid less frequently than monthly or on a non-recurring basis.
(as) Non-Defaulting Party - as defined in Article 17.1.
(at) Opening Date - the date upon which Manager first opens the Entertainment
Facility to the public and commences business thereat. The parties shall
confirm the Opening Date in an amendment to this Agreement.
(au) Operating Agreements - all agreements for the delivery of goods and/or
services to the Entertainment Facility.
(av) Operating Budget - the Budget adopted by Owner as part of its Annual Plan,
pursuant to Section 7(l) of Owner's Partnership Agreement, as modified from
time to time.
(aw) Operating Costs - the following costs and expenses charged as a cost of
operation under Standard Accounting Principles:
(i) the cost of replacement of Operating Supplies and Operating Equipment
in the ordinary course of Entertainment Facility operations;
(ii) the cost of Compensation;
(iii) the cost of advertising and promotion for the Entertainment Facility;
(iv) the cost of employee training programs;
(v) the cost of utilities and energy;
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(vi) the fees for Licenses and Permits required for the operation of the
Entertainment Facility;
(vii) all expenditures made by Manager for maintenance and repairs to keep
the Entertainment Facility in good condition and repair pursuant to
Article 7.5;
(viii) the Management Fees (Base Management Fee and Incentive Management
Fee payable pursuant to Article 9);
(ix) the Accounting Fee payable pursuant to Article 9.2; and
(x) Service Fees payable pursuant to Article 11.1.
(ax) Operating Cost Savings - as defined in Article 9.1.2.
(ay) Operating Equipment - all equipment other than Furnishings and Equipment
required for the operation of an Entertainment Facility, including
chinaware, glassware, linens, silverware, utensils, uniforms, and all other
similar items.
(az) Operating Lease - as defined in Owner's Partnership Agreement.
(ba) Operating Supplies - food and beverages and other consumable items used in
the operation of an Entertainment Facility, such as fuel, soap, cleaning
materials, matches, stationery and all other similar items.
(bb) Owner's Accountant(s) - the certified public accounting firm selected by
Owner under Owner's Partnership Agreement.
(bc) Owner's Partnership Agreement - that certain general partnership agreement
dated November 2, 1995 by and between Players and Xxxxxx'x (Maryland), as
same may be amended from time to time by Players and Xxxxxx'x (Maryland).
(bd) Ownership Costs - shall be defined as:
(i) debt service (interest and principal) relating to the Entertainment
Facility, whether unsecured or secured by any mortgage or deed of
trust;
(ii) Impositions;
(iii) construction and Capital Replacement and improvement expenditures
under Articles 2.2, 7.5, 7.6, 15 and 16;
(iv) audit, legal and other professional or special fees;
(v) insurance premiums;
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(vi) costs of leasing or purchasing any Furnishings and Equipment or
other goods incorporated into or used in connection with the
Entertainment Facility;
(vii) uninsured liabilities relating to injury to persons or property
incurred by Manager in connection with the operation of the
Entertainment Facility; and
(viii) such other costs or expenses which are normally treated as capital
expenditures under Standard Accounting Principles.
(be) Permitted Exceptions - (i) any Authorized Mortgage; (ii) liens for
Impositions not yet delinquent; (iii) undetermined or inchoate liens or
charges for labor or materials supplied to the Entertainment Facility in
connection with the construction or operation thereof, which have not been
filed or recorded in the public records and the payment for which is not
yet delinquent; and (iv) easements, restrictions, rights of way or other
title matters which do not, in the aggregate or individually, impair the
use of the Entertainment Facility for its intended purpose or adversely
affect the amount of fees payable to Manager hereunder. Permitted
Exceptions shall, without limiting the foregoing, include all of those
matters listed in Exhibit B to this Agreement.
(bf) Plans and Specifications - a collective term for all designs, layouts,
drawings, plans, specifications and decor and concept themes pertaining to
the Entertainment Facility which are prepared by Owner. Until modified with
approval of Xxxxxx'x (Maryland) and Players, the Plans and Specifications
shall mean the Plans and Specifications identified in Exhibit E to Owner's
Partnership Agreement.
(bg) Players - Players MH, L.P., a Missouri limited partnership.
(bh) Players' Affiliate(s) - Players International, Inc. and any of its direct
or remote subsidiaries, determined at the time of application of the
contract provision using this term.
(bi) Players' License - that certain License Agreement of even date herewith,
pursuant to which Players has authorized the use of the Players' System
Marks by Manager
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and Owner for the purpose of identifying and advertising the Entertainment
Facility.
(bj) Players' System Marks - all service marks, trademarks, copyrights,
tradenames, patents, or similar rights or registrations now or hereafter
held or applied for in connection with the operation of casinos or hotels
by Players International, Inc. and Players' Affiliates.
(bk) Pre-Opening Account - as defined in Article 5.2.
(bl) Pre-Opening Budget - the budget of Pre-Opening Expenses for the
Entertainment Facility attached as Exhibit G.
(bm) Pre-Opening Expenses - expenses which Manager anticipates to be necessary
or desirable in order to prepare the Entertainment Facility for opening to
the public, including without limitation, cash for disbursements, initial
Operating Equipment and Operating Supplies, hiring, relocation, training
and housing of employees (whether on or off Site), advertising and
promotion, office overhead and office space (whether on or off Site), and
travel and business entertainment (including opening celebrations and
ceremonies), but excluding all other Construction Costs (as defined in
Owner's Partnership Agreement), including, without limitation, Furnishings
and Equipment, whether or not included in the Cost Budget of Owner (as
defined in the Owner's Partnership Agreement).
(bn) Pre-Opening Inspection - as described in Article 5.4.
(bo) Present Value - shall mean the present value of the stream of Management
Fees payable hereunder had there had been no Event of Default, computed
using a reasonable per annum discount rate, compounded semi-annually from
the respective dates upon which Management Fees would be paid; determined
by agreement between Players and Manager or by arbitration pursuant to
Article 20.
(bp) Service Fees - as defined in Article 11.
(bq) Site - the Project Site as defined in Owner's Partnership Agreement.
(br) Standard Accounting Principles - the Uniform System of Accounts for Hotels
(Eighth Revised Edition 1986) adopted by the Hotel Association of New York
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City, Inc. and the American Hotel & Motel Association, as further revised
from time to time, or to the extent not therein addressed, United States
generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles board of the American Institute
of Certified Public Accountants, and statements and pronouncements of the
financial Accounting Standards Board, or in the event such Accounting
Principles Board and Financial Accounting Standards Board are no longer in
existence or no longer publish such principles, opinions and statements, in
such other opinions, statements and pronouncements of such other entity as
is approved by a significant element of the accounting profession. Standard
Accounting Principles shall be applied in the manner set forth in Xxxxxx'x
Financial Reporting and Accounting Policies Manual, a copy of which is
attached at Exhibit D.
(bs) Term - as defined in Article 3.1.
(bt) Variable Expenses - the expenses identified in Exhibit H.
(bu) Year - each twelve (12) month period following the Opening Date.
ARTICLE 2
SCOPE OF AGREEMENT
2.1 Subject Matter. The subject matter of this Agreement is the
Entertainment Facility to be constructed, furnished and equipped by Owner on the
Site. The Entertainment Facility is to be operated under the name and style
Riverport Casino Center, and the hotel to be constructed within the
Entertainment Facility (the "Hotel") is to be operated under the name and style
Xxxxxx'x(R)- Riverport Casino Center Hotel.
2.2 Development. Owner agrees that it shall, at its sole cost, acquire and
maintain fee simple title or a leasehold estate pursuant to the Ground Lease, as
the case may be, to the Site and provide for and complete construction,
furnishing and equipping of, the Entertainment Facility, Excursion Gambling
Boats and Excursion Gambling Support Facilities, as the case may be, and deliver
to Manager, for management and operation, the completed Entertainment Facility.
2.3 Grant and Acceptance of Management Responsibility. Owner grants to
Manager the sole and exclusive right to supervise and direct pre-opening
activities and, following the Opening
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Date, the management and operation of the Entertainment Facility for the account
of Owner subject to the terms of this Agreement. Manager accepts said grant and
agrees that it will supervise and direct the management and operation of the
Entertainment Facility subject to the terms of this Agreement.
2.4 Funding. Owner agrees to provide all funds, both initially and
throughout the term of this Agreement, as shall be necessary to perform and
satisfy Owner's covenants and responsibilities under this Agreement.
ARTICLE 3
TERM
3.1 Term. The term ("Term") of this Agreement shall begin on the Effective Date
and shall continue until December 31, 2005. Manager shall have the option to
extend the term for fourteen (14) consecutive periods of five (5) years each.
Manager shall be deemed to have exercised its option to extend the term of this
Agreement for each extension period unless it shall have delivered to Owner
written notice to the contrary at least one hundred twenty (120) days prior to
the date of expiration of the then current period of the term. The word "Term"
shall mean the initial term and all extension periods exercised or deemed to
have been exercised by Manager, provided that, solely for the purpose of
determining damages pursuant to Article 17 of this Agreement and measurement of
loss for loss of income insurance purposes, the word "Term" shall mean the
initial period plus all possible extension periods, whether or not then
exercised by Manager. The Term of this Agreement may be terminated in the event
that Manager's rights are acquired by Players and payment therefor is made
pursuant to the provisions of Owner's Partnership Agreement, or this Agreement
is terminated for the reasons set forth herein.
ARTICLE 4
COVENANTS OF OWNER
4.1 Licensing and Permitting. Owner shall, on or before the Opening Date, have
obtained, and throughout the Term, shall maintain all necessary enabling
legislation and governmental and local authority decrees, acts, orders,
consents, licenses and permits, including without limitation, restaurant and
alcoholic beverage licenses required to enable Owner to own the Entertainment
Facility, and Manager to operate the Entertainment Facility (including without
limitation, all
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guest rooms, health club facilities, entertainment facilities, parking
facilities, kitchens, laundry, restaurant, and alcoholic beverage facilities),
excluding any such Licenses that are required, by applicable Legal Requirements,
to be applied for and held by Manager (collectively, the "Licenses and
Permits"). Manager shall, on or before the Opening Date, have obtained and
throughout the Term shall manage all Licenses and Permits required to be
obtained and maintained by Manager. Owner and Manager shall use their best
efforts to obtain a 3:00 A.M. alcoholic beverage license for the Entertainment
Facility.
4.2 Title/Quiet Enjoyment. Owner represents and covenants that it has
acquired fee simple title to or leased the Site pursuant to the Ground Lease,
and, throughout the Term, will maintain, fee simple title and its leasehold
estate pursuant to the Ground Lease, in the Entertainment Facility, Excursion
Gambling Boats and Excursion Gambling Support Facilities, as the case may be,
subject only to the Permitted Exceptions and the provisions of Article 21.2 of
this Agreement. Owner covenants, during the Term, that Manager shall and may
peaceably and quietly operate the Entertainment Facility in accordance with the
terms of this Agreement, free from molestation, eviction and disturbance by
Owner or by any other person or entity. Owner shall, at Owner's expense,
undertake and prosecute all actions, judicial or otherwise, required to assure
such quiet and peaceable operation by Manager.
ARTICLE 5
PRE-OPENING
5.1 Pre-Opening Budget. Exhibit G is the Pre-Opening Budget for the
Entertainment Facility approved by Owner. Manager is authorized, for and on
behalf of Owner and at Owner's expense, to take all actions which it deems
necessary or desirable to implement, perform or cause the performance of the
items identified in the Pre-Opening Budget. Expenditures in excess of the
Pre-Opening Budget shall be made only with the prior written approval by Owner
of a modification to the Pre-Opening Budget.
5.2 Payment of Pre-Opening Expenses. Owner shall, at the time of
commencement of construction of the Entertainment Facility, establish a bank
account, pursuant to a Banking Resolution in the form attached as Exhibit F,
(the sole signatories of which shall be designees of Manager) in the amount of
THREE HUNDRED THOUSAND and 00/100 DOLLARS ($300,000)
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(the "Pre-Opening Account"). Thereafter, the Pre-Opening Account shall be funded
according to the schedule attached as Exhibit I. Manager shall pay Pre-Opening
Expenses from the Pre-Opening Account, and may pay such amount, if funds in the
Pre-Opening Account should be exhausted, from its own funds, on behalf of Owner.
Owner shall, in such case, reimburse the Pre-Opening Account or Manager, as the
case may be, on demand, for all amounts paid from the Pre-Opening Account or
from Manager's own funds (together with interest on any portion thereof advanced
by Manager from its funds at the Interest Rate plus eight percent (8%) per year
from the date of advancement until the date of repayment). All Pre-Opening
Expenses advanced or incurred by Manager shall be itemized, scheduled and
submitted to Owner along with each demand for payment. Reimbursement shall be
made by Owner to Manager within ten (10) days after the date of submission of
each such schedule.
5.3 Pre-Opening Hiring and Training of Employees. Manager agrees, at
Owner's cost, to recruit, relocate, hire and train employees to manage and
operate the Entertainment Facility in accordance with Xxxxxx'x Operational
Standards. To the extent pre-completion occupancy is permitted by applicable
insurance policies and Licenses and Permits for the Building, pre-opening
recruiting, hiring and training may be conducted at the Entertainment Facility
during the Development Period (unless and until Owner determines and advises
Manager in writing that such activities unreasonably interfere with the
Completion of the Entertainment Facility) and employees involved in such
recruiting, hiring and training may be housed at the Entertainment Facility. The
persons holding positions of employment identified in Exhibit L (collectively,
"Key Personnel") and all department heads, such as department engineer, head
housekeeper, front office manager and other similar employees, may be hired and
assigned to the Entertainment Facility at such time during the Development
Period as Manager, in its discretion, deems necessary.
5.4 Pre-Opening Inspection. A pre-opening inspection (the "Pre-Opening
Inspection") shall be conducted jointly by Owner and Manager upon Completion to
detect and to note any Deficiencies. Owner agrees to take all measures
reasonably necessary to remedy any Deficiencies as promptly as practicable
following the Pre-Opening Inspection, but in all events, within the time
established by any governmental regulatory authority or insurance underwriter.
5.5 Opening. Owner shall determine the Opening Date of the Entertainment
Facility.
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ARTICLE 6
STANDARDS AND MANAGER'S CONTROL
6.1 Xxxxxx'x Operational Standards. Manager shall operate the Entertainment
Facility in accordance with Xxxxxx'x Operational Standards, but only if required
funds are made available by Owner, and, provided that, if Xxxxxx'x Operational
Standards are violative of Legal Requirements, Legal Requirements shall be the
controlling standard.
6.2 Manager's Obligations. Manager shall have the obligation and the sole
and exclusive authority, throughout the Term, to:
(a) hire, supervise, establish levels of Compensation for, negotiate collective
bargaining agreements with (if applicable), establish labor polices with
respect to, and discharge (as it deems appropriate), all employees at the
Entertainment Facility, as more particularly provided in Article 7.3;
(b) determine the terms of guest admittance to the Entertainment Facility,
provided that in making such determination, Manager shall endeavor to treat
each of the Operating Lease lessees, and any guests, customers or patrons
referred by either of them, on an equal and non-discriminatory basis
applying the policies set forth in Exhibit J.
(c) implement the advertising and marketing plan for the Entertainment Facility
described in the Annual Plan:
(d) select suppliers of goods and services for the Entertainment Facility
(except with respect to the construction, equipping and furnishing of the
Entertainment Facility and Capital Replacements or improvements which shall
be undertaken by Owner, as more particularly provided in Articles 2.2, 7.6,
15 and 16 of this Agreement);
(e) control and manage the Bank Accounts established by Owner for the
Entertainment Facility, as more particularly provided in Article 8.3;
(f) perform operational accounting (but not ownership accounting) for the
Entertainment Facility, as more particularly provided in Article 8.1;
(g) retain and supervise legal counsel and other professional consultants, as
Manager may deem necessary and proper to the performance of this Agreement;
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(h) supervise and effect, or cause to be effected maintenance and repairs,
pursuant to Article 7.5;
(i) enter into, on Owner's behalf, and as Owner's authorized agent, any
contracts necessary or convenient to the accomplishment of this Agreement
and any leases of the Entertainment Facility that are approved by Owner;
(j) collect and disburse Gross Revenues of the Entertainment Facility on behalf
of Owner, as more particularly provided in Article 10;
(k) operate the Entertainment Facility in accordance with the Minimum
Standards; and
(l) develop and implement Emergency procedures for the Entertainment Facility,
Excursion Gambling Boats, and Excursion Gambling Boat Support Facilities
and for obtaining approval for said procedures from the
Bridgeton-Pattonville Terrace Fire District, the Maryland Heights Police
Department and other appropriate public safety agencies. In this regard,
Manager may assume the role of "Executive Command" in the event of an
Emergency and supervise and implement Emergency procedures. Players'
personnel will provide necessary assistance to the Manager in the execution
of its duties as Executive Command. At no time will Players change, modify,
add to or delete any element of the Manager's Emergency procedures without
written approval from the Manager. During an Emergency, Players will be
subordinate to Manager, and at no time, with regard to Emergency
procedures, will Players' personnel countermand, disregard or fail to
execute a directive from the Manager. Manager's Emergency procedures shall
terminate, as to any particular Emergency, upon the cessation of such
Emergency. Manager shall have the option, at its election, and authority
to:
(a) supervise and effect or cause to be effected any Capital Replacements
or improvements required by any emergency condition or Legal
Requirements, as provided in Articles 7.7 and/or 7.8; or
(b) make any other expenditures required of Owner under this Agreement;
and in both such cases, to recover, as a reimbursable expense, the cost
thereof with interest from the date of advancement to the date of repayment at
the Interest Rate from Owner on demand. Manager shall in no event be obligated
to expend its funds or incur any liability in the performance of its obligations
under this Agreement, and Manager's obligations shall be excused
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to the extent that: (i) Owner fails to provide all funds required for Manager to
perform such obligations within the time period provided by this Agreement; or
(ii) performing this Agreement would require Manager to incur any liability; or
(iii) if any act or omission of Owner impairs the ability of Manager to perform
any obligation under this Agreement.
6.3 Owner's Obligations. Owner shall have the sole responsibility and
obligation throughout the Term, unless Players and Xxxxxx'x (Maryland), as
partners of Owner, unanimously elect not to do so, to:
(a) provide all funds required by Manager for the operation of the
Entertainment Facility, as and when required by this Agreement;
(b) except for transfers permitted by Article 21.2, maintain good and
sufficient record and marketable fee simple title and leasehold estate
pursuant to the Ground Lease, as the case may be, to the Entertainment
Facility, and assure Manager's quiet enjoyment of the Entertainment
Facility, free from all exceptions other than Permitted Exceptions and free
from interference by any party having rights under any Permitted Exception;
(c) obtain, maintain, pay for and provide evidence to Manager of all insurance
required by Article 13;
(d) construct, equip, furnish, refurbish, reconstruct and improve the
Entertainment Facility as from time to time required by the terms of this
Agreement (including, without limitation, Articles 2.2, 7.6, 15, and 16);
(e) obtain and maintain all Licenses and Permits required for its continued
legal existence, authorization to conduct business, ownership of the
Entertainment Facility, and continued operation of all facilities at the
Entertainment Facility, as more particularly provided in Article 4.1;
(f) pay all Impositions assessed against the Entertainment Facility as same
become due and before any action is commenced to enforce the collection or
foreclosure of the lien thereof;
(g) pay all indebtedness from time to time encumbering or relating to the
Entertainment Facility as and when same becomes due and payable and before
any
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action is commenced against Manager, Owner, or the Entertainment Facility
for the nonpayment thereof;
(h) enforce all agreements in effect for the benefit of the Entertainment
Facility, including the Permitted Exceptions which, if not enforced, may
have an adverse effect upon Manager's enjoyment of Manager's rights or
Manager's ability to perform Manager's obligations under this Agreement;
and
(i) establish the Operating Budgets and Annual Plans (as well as all
modifications thereto) in a timely manner.
6.4 Manager's Control. Manager will have uninterrupted control over the day
to day operation of the Entertainment Facility. Owner agrees not to interfere or
involve itself in any way with the day-to-day operation of the Entertainment
Facility.
ARTICLE 7
OPERATION OF THE ENTERTAINMENT FACILITY
7.1 Permits. Manager agrees to use all reasonable efforts within its control to
comply with any conditions or requirements set out in or imposed by law in
connection with any Hotel Licenses and Permits, for so long as the expense of
such compliance shall be paid for by Owner.
7.2 Equipment and Supplies. Manager shall be responsible and authorized to
obtain, on behalf of Owner and at Owner's cost, subject to the fiscal
limitations of this Agreement, all Operating Supplies, Operating Equipment and
alcoholic beverage inventories necessary or advisable in connection with the
operation of the Entertainment Facility, except that Owner shall be solely
responsible to supply initial Operating Supplies, Operating Equipment and
Furnishings and Equipment, and such Capital Replacements as from time to time
are required to comply with Xxxxxx'x Operational Standards.
7.3 Employees
(a) Authority of Manager. Manager will hire, supervise, direct, discharge and
determine the Compensation and terms of employment of all employees working
in the Entertainment Facility. Manager, in the exercise of its discretion,
is to be the sole judge of the fitness and qualification of all employees
and is vested with absolute discretion in the hiring, supervising,
directing, discharging and
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determining the Compensation of all employees. All employees, other than
any employees who are, by Legal Requirement or any License or Permit,
required to be in the employ of Owner, shall be employed by Manager. Owner
shall not interfere with or give orders or instructions to any employees at
the Entertainment Facility. Manager shall be the sole and exclusive
bargaining agent with respect to all collective bargaining agreements and
other employee matters with full power and authority to negotiate
collective bargaining agreements (which may extend beyond the Term and
exceed the Compensation authorized by the then current Annual Plan) and to
settle all employee grievances and claims. Owner shall not be entitled to
participate in labor negotiations or claims. Manager will, however, keep
Owner advised of the results of such negotiations and claims. Owner shall
have the right to approve any collective bargaining agreement which may be
negotiated, so long as such approval does not interfere with Manager's
rights, as exclusive bargaining agent, and Manager's obligation to bargain
in good faith with a labor organization. Manager will provide Owner copies
of any rulings or settlements which may be entered into.
(b) Employee Discount. Employees of Manager who are not based in Maryland
Heights may be provided with complimentary rooms and food whenever said
employees are on the premises or in the vicinity of the Entertainment
Facility performing services for the Entertainment Facility as an Operating
Cost of the Entertainment Facility. Housing for the Director of Hotel
Operations and his family, whether on or off Site, shall be at Manager's
election and shall be an Operating Cost of the Entertainment Facility.
Further, the Director of Hotel Operations and his family, if living
on-Site, shall be granted complimentary food and beverages when such is
customary in Manager's practice and policy. Manager shall be entitled to
extend discounted or complimentary rooms to employees of Manager, Manager's
Affiliates, Players' and Players' Affiliates, on a non- discriminatory
basis, in accordance with Manager's customary practices, provided
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that complimentary rooms shall not be given to any such employee if such
action would be likely, at the time approved, to displace a customer.
(c) Employee Cost Indemnity. Owner shall be solely responsible for and shall
pay, reimburse, indemnify, defend and hold Manager harmless from and
against any and all expenses, costs, liabilities and claims related or
incidental to any employees at the Entertainment Facility (including, by
way of example only, all salaries, vacation, sick leave, severance or
termination benefits, pension plan liabilities, savings and retirement plan
contributions, workers' compensation benefits or claims, health, disability
or life insurance contributions, state, federal or local payroll or other
employer paid or collected taxes, injury, discrimination, back pay,
grievance or wrongful termination awards and any other costs and benefit
for Entertainment Facility employees (however designated), unless caused by
the gross negligence or wilful misconduct of Key Personnel.
(d) Professional Consultants. The cost, fees, compensation or other expenses of
any persons engaged by Owner to perform duties of a special nature, related
to the Entertainment Facility, such as attorneys, accountants and the like
(whether independent contractors or employees of Manager or Manager's
Affiliates), shall be an Operating Cost, and in each instance, the
Operating Budget shall automatically increase by the amount of such cost.
7.4 Marketing and Advertising. Manager shall, and is authorized to,
advertise and promote the business of the Entertainment Facility, and implement
and supervise the advertising and marketing program therefor adopted by Owner as
part of the Annual Plan.
7.5 Maintenance and Repairs
Manager shall make or cause to be made all ordinary repairs and
maintenance, as well as maintain, repair replace or add all Operating Equipment
and Operating Supplies, in the normal and ordinary course of operation of the
Entertainment Facility, including, without limitation, any such repairs,
maintenance, replacement or addition as shall be required to comply with
Xxxxxx'x Operational Standards.
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7.6 Capital Replacements/Improvements. Owner shall effect and expend such
amounts for all Capital Replacements and improvements as shall be required, in
the course of operation of the Entertainment Facility, to maintain the
Entertainment Facility in compliance with all Legal Requirements, and, to the
extent not violative of Legal Requirements, Harrah's Operational Standards,
including, without limitation, Manager's recommended programs for renovation,
modernization and improvement intended to keep the Entertainment Facility
competitive in its market. Design and installation of Capital Replacements shall
be effected in a time period and subject to such conditions as Manager may
establish to minimize interference with or disruption of ongoing Entertainment
Facility operations.
7.7 Emergency Expenditures. If Manager determines that an Emergency exists,
Manager is authorized to take all steps and to make all expenditures from the
Bank Accounts, as it deems necessary to repair and correct any such condition,
regardless whether provisions have been made in the Annual Plan for any such
expenditures, and the cost thereof shall be paid as an Operating Cost or, if
Gross Revenues are insufficient to repay such expenditure in the Fiscal Month
when it is made, reimbursed by Owner, on demand, and in each instance, the
Operating Budget shall automatically increase by the amount of such cost.
7.8 Compliance with Legal Requirements. If, at any time, repairs to or
additions, changes or corrections in the Entertainment Facility of any nature
shall be required by reason of any laws, ordinances, rules or regulations now or
hereafter in force, or by order of any governmental or municipal power,
department, agency, authority or officer ("Legal Requirements"), such repairs,
additions, changes or corrections may, whether or not provided for in the Annual
Plan, be made by or at the direction of Manager if not made by Owner in time to
avoid any fine or adverse consequence to the operation of the Entertainment
Facility and paid for from the Bank Accounts, and the cost thereof shall be paid
as an Operating Cost or, if Gross Revenues are insufficient to repay such
expenditure in the Fiscal Month when it is made, reimbursed by Owner, on demand,
and in each instance, the Operating Budget shall automatically increase by the
amount of such cost.
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ARTICLE 8
FISCAL MATTERS
8.1 Accounting Matters and Fiscal Periods
(a) Complete and accurate books and records reflecting Entertainment Facility
operations shall be kept by Manager in accordance with Standard Accounting
Principles and shall be maintained either at the Entertainment Facility or
at the national or any regional office of Manager or Manager's Affiliate,
at Manager's option. Owner shall be solely responsible to maintain
ownership level books and accounts reflecting Ownership Costs, the costs of
Owner's sales and marketing programs, and Owner's tax and accounting
matters. Owner's Accountant(s) shall have the right and privilege of
examining the books and records maintained by Manager during normal working
hours (Monday-Friday) upon no less than forty eight (48) hours advance
written notice.
(b) A certified audit of the Entertainment Facility operations shall (at
Owner's election to be effected by written notice to Manager given on or
before the end of any Fiscal Year) be performed within ninety (90) days
after the end of such Fiscal Year, and upon termination or expiration of
this Agreement. Such audit shall be performed by Owner's Accountants. The
determination of such accounting shall, unless appealed to arbitration by
Manager, be conclusive and binding on the parties as to all matters
properly addressed thereby, and Owner and/or Manager shall, promptly upon
receipt thereof, adjust between them, any over or underpayment made or
received by either of them, as the case may be, during the audited period.
The cost of accounting services delivered in connection with such audit
shall be an Ownership Cost.
(c) The fiscal accounting periods (the "Fiscal Periods") for the Entertainment
Facility shall be the calendar year ("Fiscal Year"), calendar quarter
("Fiscal Quarter"), and calendar month ("Fiscal Month"). On or before the
twenty-fifth (25th) day of the calendar month next following the close of a
Fiscal Month, Manager shall furnish Owner with a detailed operating
statement setting forth the results of Entertainment Facility operations.
There is attached hereto as Exhibit A a form of the operating statement
currently utilized by Manager which reflects the results
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of the prior Fiscal Month of operations as well as the cumulative fiscal
year-to-date results of operations. The form of the operating statement may
be modified from time to time by Manager at its discretion, so long as it
remains consistent with Standard Accounting Principles.
8.2 Operating Budget/Annual Plan
8.2.1 Fiscal Authority and Constraint. The Annual Plan and Operating Budget
for the Entertainment Facility shall be that adopted by Owner pursuant to
Section 7(l) of Owner's Partnership Agreement and shall, when adopted, establish
and limit Manager's authority to expend monies for the Entertainment Facility,
except as otherwise provided in this Article.
8.2.2 Food and Beverage Pricing/Advertising and Marketing. Owner and
Manager recognize that administration of: (i) hotel room pricing; (ii) food and
beverage menu pricing; and (iii) marketing and promotion; of the Entertainment
Facility often require prompt adjustment to changing circumstances, including
without limitation, availability of new products and services, changes in public
tastes, changes in the costs of goods and services, and changes in the
competitive environment. In order to facilitate flexibility in the
administration of such features of the Annual Plan, Owner delegates to Manager
and the general manager of Players' Operating Lease premises, the authority, by
joint written agreement, to modify such elements of an Annual Plan without need
for a meeting or further approval under Owner's Partnership Agreement.
8.2.3 Compliance. Manager shall be permitted to reallocate part or all of
the amount budgeted by an Operating Budget with respect to any line item to
another line item in the same Department, but may not reallocate from one
Department to another Department. Manager shall also be entitled to make
expenditures not authorized under the then applicable Annual Plan to pay for:
(a) emergencies as provided in Article 7.7;
(b) compliance with Legal Requirements as provided in Article 7.8;
(c) the actual cost of any utilities, fuel, Licenses or Permits, insurance
required by this Agreement or otherwise secured by Owner, or Impositions;
(d) uninsured liabilities, including without limitation, uninsurable claims
(such as employee claims, environmental and civil rights claims), the
amount of any uninsured or deductible portion of any insured claim, and any
assessments relating to health or other insurance programs having cost-plus
or self insurance features;
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(e) additional Compensation due pursuant to any collective bargaining agreement
negotiated with a union;
(f) additional Ownership Costs incurred by Owner after approval of an Annual
Plan;
(g) any deficiencies assessed by a taxing authority;
(h) additional costs permitted by Article 8.2.4;
and in each such instance, the amount of the Operating Budget shall
automatically increase by the amount of such cost.
8.2.4 Adjustment to Annual Plan. If Manager encounters circumstances which
require unbudgeted and unexpected expenditures not foreseen at the time of
preparation of the Annual Plan and which Manager deems reasonably necessary, in
addition to and without limiting the instances described in Article 8.2.3, and
including, without limitation, expenditures that Manager deems necessary for the
continued operation of the Entertainment Facility in accordance with Xxxxxx'x
Operational Standards, as determined by Manager, in good faith, Manager may,
without Owner's approval, make such expenditures for so long as the same will
not, based upon Manager's reasonable expectations, cause Manager to exceed one
hundred and five percent (105%) of the amount budgeted for any Department or, if
greater, with respect to Variable Expenses for any Department, such Variable
Expenses will not, based upon Manager's reasonable expectations, cause Manager
to exceed an amount such that the ratio of the amount so expended to the
revenues of the affected Department exceeds the ratio (expressed as a
percentage) of the Variable Expenses budgeted to the revenues forecasted,
rounded up to the next full percentage point. If Manager expects that such
future expenditures will cause Manager to exceed (i) one hundred and five
percent (105%) of the amount budgeted for such Department or, if greater, (ii)
an amount such that the ratio of the amount of Variable Expenses so expended to
the revenues of a Department will exceed the ratio (expressed as a percentage)
of the Variable Expenses budgeted to the revenues of such Department forecasted,
rounded up to the next full percentage
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point, Manager shall have the right, from time to time during such Fiscal Year;
to submit a revision to the Operating Budget contained within the Annual Plan to
Owner for approval. Owner will review all proposed revisions to an Operating
Budget in the same manner as the Operating Budget contained within the initial
Annual Plan. If Owner shall disapprove or raise any objections to any items
contained in revisions to an Operating Budget, Manager shall be entitled to
arbitrate such disapproval or obligations under this Agreement.
8.3 Bank Accounts
(a) Owner shall establish account(s) in its name at a bank (with retail offices
in the immediate geographic vicinity of the Entertainment Facility) (the
"Bank Account(s)") as Manager determines to be necessary or convenient for
the operation of the Entertainment Facility. Manager's designees shall be
the only signatories authorized to draw upon the Bank Account(s). Before
the Opening Date, Owner shall deposit in the Bank Account(s) ONE MILLION
FOUR HUNDRED THOUSAND DOLLARS ($1,400,000) (the "Minimum Balance"). This
Minimum Balance shall serve as working capital for Entertainment Facility
Operating Costs and Impositions. The Minimum Balance may be increased by
Manager, at any time during the first twelve (12) Fiscal Months after the
Opening Date, to reflect unanticipated working capital needs revealed by
the experience of actual Entertainment Facility operations, and again at
the time of each anniversary of the Opening Date. Owner shall furnish
Manager immediately, upon demand, with sufficient funds to make up any
deficiency in the Minimum Balance (as so adjusted).
(b) Manager shall have absolute control of the Bank Account(s). All Gross
Revenues of the Entertainment Facility shall pass through the Bank
Accounts.
(c) Manager shall be entitled to maintain separate or commingled payroll
accounts or xxxxx cash funds and to make payments therefrom as customary in
Manager's business practices.
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ARTICLE 9
FEES TO MANAGER
9.1 Management Fees. The Management Fees shall have two components: (i) a
Base Management Fee, as described in Article 9.1.1; and (ii) an Incentive
Management Fee as described in Article 9.1.2.
9.1.1 Base Management Fee. Owner agrees to pay to Manager a base management
fee (the "Base Management Fee") equal to three percent (3%) of Hotel Revenues.
The Base Management Fee shall be paid monthly, in arrears, following the Opening
Date, on the first day of the immediately ensuing Fiscal Month.
9.1.2 Incentive Management Fee. Owner agrees to pay Manager an incentive
management fee (the "Incentive Management Fee") based upon the success of
Manager in operating the Entertainment Facility in a manner which results in
Operating Costs not exceeding the amount set forth within the Operating Budget
for such Fiscal Year taken as a whole, and not on a line item or Departmental
basis, as the same may be modified pursuant to this Agreement (either by
amendment or by increase to include any unbudgeted costs [pursuant to Articles
7.7, 7.8, 8.2.3 and/or 8.2.4] expended by Manager pursuant to the authority of
this Agreement). The Incentive Management Fee shall equal the greater of: (i)
one percent (1.0%) of Hotel Revenues or (ii) fifty percent (50%) of the
Operating Cost savings realized by Manager, measured by the difference between
(x) the actual Operating Costs incurred by Manager in the operation of the
Entertainment Facility for each Fiscal Year and (y) the authorized Operating
Cost of the Entertainment Facility for such Fiscal Year established by the
Operating Budget adopted pursuant to Section 7(l) of Owner's Partnership
Agreement, modified as provided in Articles 7.7, 7.8, 8.2.3 and/or 8.2.4 of this
Agreement (such difference being the "Operating Cost Savings"). The Incentive
Management Fee shall be earned and paid annually, within 10 days after Manager's
close of the accounting books and records for the Entertainment Facility for
such Fiscal Year. In the case of any partial Fiscal Year, the Operating Budget
shall be prorated equitably and actual Operating Costs shall include only those
reasonably allocable to the portion of such Fiscal Year that the Entertainment
Facility was operated by Manager, which allocation shall be determined by
arbitration under this Agreement if Owner and Manager do not agree.
9.1.3 Payment. Manager shall be authorized to pay the Management Fee (as
well as the
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Accounting Fee provided for in Article 9.2, Service Fees provided for in Article
11 and any other amounts payable to Manager pursuant to the terms of this
Agreement) to itself directly by withdrawal from the Bank Account. The
Management Fee, Accounting Fee, Service Fees, and reimbursable amounts for the
final Fiscal Month of the Term shall be paid on or before termination.
9.2 Accounting Fee. Owner shall pay to Manager an annual accounting fee
(the "Accounting Fee") equal to ONE HUNDRED THIRTY THOUSAND DOLLARS ($130,000)
per Fiscal Year. This fee shall compensate Manager for the performance of
operations and fixed asset accounting and reporting required by this Agreement.
The Accounting Fee shall be payable in equal monthly installments, in arrears,
at the time of each payment of the Management Fee. The Accounting Fee shall be
increased annually, at the time of each anniversary of the Effective Date, to
reflect increases in the Consumer Price Index from the Effective Date to the
date of adjustment.
ARTICLE 10
DISBURSEMENTS
10.1 Priority of Disbursements. As and when received by Manager, Gross Revenues
shall be deposited in the Bank Account(s) created pursuant to Article 8.3 of
this Agreement. There shall, in turn, be disbursed by Manager, from the Bank
Account, all Operating Costs and Impositions for the Entertainment Facility
(including, without limitation, Ownership Costs which Manager may pay under this
Agreement), as bills are received for payment or amounts become due, and to the
extent funds are adequate and available.
10.2 Adjustment to Bank Account. After the disbursements pursuant to
Article 10.1, and establishment of any reserves for future disbursements as
Manager deems necessary, taking into account anticipated cash flow from, and
Operating Costs at, the Entertainment Facility, any excess funds remaining in
the Bank Account over the Minimum Balance shall monthly be disbursed to Owner.
Correspondingly, and without limiting Owner's obligation to, at all times,
provide any funds required by this Agreement, any deficiency of the Bank Account
below the Minimum Balance shall immediately be provided by Owner.
10.3 Payment of Ownership Costs. Owner shall pay for all Ownership Costs
(and, should Gross Revenues be insufficient to pay for same, all Operating Costs
as provided in Article 10.2)
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as same become due and payable and before any interest or penalty may attach for
non-payment thereof or action be commenced against the Entertainment Facility,
Owner or Manager for enforcement thereof.
10.4 Payment of Sales and Other Operational Taxes. Manager shall be
responsible to file all necessary returns and remit from Gross Revenues to the
governmental authorities having jurisdiction over the Entertainment Facility,
all sales taxes, excise taxes, use taxes, gross receipts taxes, admission taxes,
entertainment taxes, tourist taxes and similar taxes and charges required by law
to be collected from patrons or guests as part of the sales price for goods,
services or entertainment at the Entertainment Facility. Manager or Owner may
contest the amount of any such taxes, provided that no penalty, interest, lien
or other detriment to Owner, Manager or the Entertainment Facility results.
Manager shall have no liability for the payment of any fines, penalties,
interest or other charges ("assessments") for any under or over payment or
miscalculation of such taxes unless caused by the gross negligence or wilful
misconduct of Manager's Key Personnel charged to administer such payments,
recognizing that the manner of calculating and reporting such taxes is often
vague and subject to broad administrative discretion. All costs of any tax
contest and all assessments of such taxes or charges shall be Ownership Costs
under this Agreement.
Owner shall pay to Manager any sales, gross receipts or similar tax imposed
upon Manager, calculated on any payment or payments to Manager required of Owner
under this Agreement, unless the tax is an alternative to an income tax
otherwise payable by Manager. Any such payment shall be made at the time of each
payment to Manager, or, if not so paid, within ten (10) days of any request by
Manager therefor.
ARTICLE 11
XXXXXX'X SERVICES
11.1 Nature of Services. The services described in this Article 11.1 ("Xxxxxx'x
Services") shall be provided by Manager and accepted by Owner, with individual
charges ("Service Fees") to accrue commencing as of the Opening Date. It is
understood that the Service Fees for Xxxxxx'x Services shall be due and payable
monthly and shall be subject to increase or decrease as
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hereinafter set forth. The presently established charges are listed below
in connection with each service to be provided:
(a) Administrative Service Fee - If and to the extent that common services are
provided to the Entertainment Facility and to the Excursion Gambling Boats
of Xxxxxx'x (LLC) following termination of the use of Shared Employees
pursuant to Article 1.1(k), including by way of example, supervisory
services, executive management, or administrative services such as check
processing or accounting, then the cost of such services shall be
established in the Operating Budget as an Administrative Service Fee,
rather than as Compensation. If such event occurs in the course of a Fiscal
Year, as contemplated by Article 1.1(k), then the Operating Budget shall
automatically be increased to include the amount of such Administrative
Service Fee agreed between Owner or Manager, or if not agreed within the
first thirty (30) days of the ninety (90) day period described in Article
1.1(k), by Arbitration under Article 20 (in which case only the amount
agreed by Owner shall be effective pending such arbitration, subject to
retroactive adjustment, with interest at the Interest Rate plus eight
percent (8.0%), if a higher Administrative Service Fee is approved by the
Arbitrator).
(b) Reservation Fee: $2.50 per guest room reservation at the hotel made through
Harrah's telephone reservation system, increased annually on each
anniversary of the Effective Date to reflect increases in the Consumer
Price Index from the Effective Date to the date of adjustment. The
Reservation Fee charged under this Agreement will be no more than the
prevailing charge to participating Xxxxxx'x hotels.
ARTICLE 12
SYSTEM XXXX SIGNS AND SYSTEM MARKS
12.1 Signs. Owner agrees to install and maintain, subject to applicable
Legal Requirements: (i) all Xxxxxx'x System Xxxx signs, Operating Equipment and
Operating Supplies; and (ii) all Players' System Xxxx signs, Operating Equipment
and Operating Supplies as provided in Section 7(m) of Owner's Partnership
Agreement. The hotel at the Entertainment Facility shall be
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identified as the Harrah's(R)-Riverport Casino Center Hotel. Stationery and
front desk signage shall indicate that the hotel is owned by a general
partnership, whose partners are Players and Harrah's (Maryland). Owner is solely
responsible for all costs of purchasing, leasing, transporting, constructing
and/or installing the required Harrah's System Xxxx signs, Operating Equipment
and Operating Supplies, Players' System Xxxx signs, Operating Equipment and
Operating Supplies, as well as for all costs of dismantling and removing such
signs at the end of the term or earlier termination hereof.
12.2 Xxxxxx'x System Marks. It is understood that no rights or interests in
the name Xxxxxx'x(R) or any other Xxxxxx'x System Marks are being granted by
this Agreement. Owner agrees to recognize the exclusive right of ownership of
Xxxxxx'x Las Vegas in and to Xxxxxx'x System Marks. Manager agrees that the
hotel within the Entertainment Facility will, from and after the Opening Date,
and subject to Owner's compliance with all of its obligations under this
Agreement, be operated by Manager under the Harrah's(R) brand name utilizing
Harrah's System Marks. Manager represents that, as a wholly owned subsidiary of
Xxxxxx'x Las Vegas, it has the right to use Harrah's System Marks in connection
with the hotel. Owner acknowledges and agrees that the use of the Xxxxxx'x
System Marks in connection with the operation and management of the
Entertainment Facility is vested solely in Manager. Owner disclaims any right or
interest in Xxxxxx'x System Marks, regardless of the legal protection afforded
thereto. Owner covenants that, in the event of expiration or termination of this
Agreement, whether as a result of default by Manager, Owner or otherwise, Owner
shall not, without the express prior written consent of Xxxxxx'x Las Vegas, hold
itself out as, or continue operation of the Entertainment Facility using the
Harrah's System Marks, and that, unless Xxxxxx'x Las Vegas shall have so
consented to the continued use thereof, Xxxxxx'x Las Vegas and its designated
contractors may enter the Entertainment Facility and may, at Owner's expense,
remove all signs, furnishings, printed material, emblems, slogans or other
distinguishing characteristics which are now or may hereafter be connected or
identified with the Xxxxxx'x System or bear Xxxxxx'x System Marks. Upon the
expiration or earlier termination of this Agreement for any reason, Owner shall
likewise remove and discontinue the use of any and all items of Operating
Equipment and any Operating Supplies that bear any Xxxxxx'x System Xxxx.
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Owner shall not convey such property to any person or entity unless such
person or entity is specifically authorized in writing by Xxxxxx'x Las Vegas
(whether under license from Manager or otherwise) to use property bearing any
Harrah's System Marks.
Owner shall not use the name Xxxxxx'x(R), any other Xxxxxx'x System Xxxx,
or any variant thereof in the name of any partnership, corporation or other
business entity, nor allow the use thereof by others, without the express prior
written consent of Xxxxxx'x Las Vegas. Owner shall not make reference to the
name "Harrah's", any other Harrah's System Xxxx, or any variant thereof,
directly or indirectly, in connection with a public sale or private placement of
securities or other comparable means of financing without obtaining, in each
instance the prior written approval of Xxxxxx'x Las Vegas.
12.3 Litigation. Owner and Manager agree that, in the event Owner and/or
Manager is or are the subject of any litigation or action brought by any party
seeking to restrain the use by Owner or Manager, or either of them, of any
Xxxxxx'x System Xxxx used by Manager for or on or in connection with the
Entertainment Facility, any such litigation or action shall be defended entirely
by and at the expense of Manager or Xxxxxx'x Las Vegas, notwithstanding that
Manager or Xxxxxx'x Las Vegas may not be named as a party thereto. Owner shall
not have the right to bring suit against any user of any of the Xxxxxx'x System
Marks. In all cases, the conduct of any suit, whether brought by Manager or
instituted against Owner and/or Manager or Xxxxxx'x Las Vegas shall be under the
absolute control of counsel to be nominated and retained by Manager or Xxxxxx'x
Las Vegas, notwithstanding that Manager may not be a party to such suit. Manager
agrees and covenants to defend and hold Owner harmless from and to indemnify
Owner against any judgments or awards of any court or administrative agency of
competent jurisdiction, whether such awards be in the form of damages, costs or
otherwise, imposed against Owner and arising from the use by Manager of any
Xxxxxx'x System Marks or similar rights or registrations for or on or in
connection with the Entertainment Facility in accordance with the terms of this
Agreement.
12.4 Players' System Marks. Manager's and Owner's right to use the Players'
System Marks at the Entertainment Facility shall be subject to the terms and
conditions of the Players' License.
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Owner and Manager agree to perform all of their respective obligations under the
Players' License.
ARTICLE 13
INSURANCE
13.1 Insurance Coverage. Owner agrees to procure and maintain, at its
expense and at all times during the term hereof, all insurance coverage required
by Exhibit C attached hereto and made a part hereof.
13.2 Failure to Obtain - Self Help
If Owner should, at any time, fail to obtain or maintain all insurance
required by this Article 13, or to provide Manager with satisfactory evidence
that such insurance remains in full force and effect, then, without limiting
Manager's other remedies for such default, Manager shall be entitled to secure
substitute insurance, and the cost thereof shall, immediately upon demand, be
paid as an Operating Cost or, if Gross Revenues are insufficient to any such
expenditure in the month when made, reimbursed by Owner to Manager on demand.
ARTICLE 14
INDEMNITY AND RELATED MATTERS
14.1 Scope
(a) Owner agrees to indemnify and hold Manager and its officers, directors,
employees, agents or independent contractors ("Indemnified Persons") free
and harmless from any liability for injury to persons or damage to property
by reason of any cause whatsoever, either in and about the Entertainment
Facility or elsewhere, including, without limitation, any such loss, cost
or damage occurring as a result of the performance of this Agreement by
Manager, its agents, employees or independent contractors, irrespective of
whether negligence on the part of any Indemnified Person is involved,
provided, however, that, as to Shared Employees, this indemnification shall
only extend to acts or omissions of such individuals occurring while they
are engaged in the performance of work for the Entertainment Facility.
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(b) Owner agrees to reimburse each Indemnified Person, upon demand, for any
money or other property which such Indemnified Person is required or
authorized by this Agreement to pay out for any reason whatsoever, whether
the payment is for Operating Costs, Ownership Costs or any other costs,
charges or debts incurred or assumed by an Indemnified Person, Owner or any
other party, or for judgments, settlements or expenses in defense of any
claim, civil or criminal action, proceeding, charge or prosecution made,
instituted or maintained against an Indemnified Person, Owner and/or
others, jointly or severally, affecting or because of the condition or use
of the Entertainment Facility or other areas, or acts or failure to act of
an Indemnified Person, Owner, employees, agents or independent contractors
of Owner, or arising out of or based upon any Legal Requirement, contract
or award (including without limitation any such matter relating to the
hours of employment, working conditions, wages and/or compensation of
employees or former employees of Owner, or any severance or termination
benefits of such employees), or for any other cause in connection with the
Entertainment Facility.
(c) Notwithstanding the foregoing, Owner shall not be liable to indemnify and
hold the Indemnified Persons harmless from any such liability not covered
by insurance which results solely from the proven gross negligence or
willful misconduct of the Key Personnel or the Memphis based officers of
Xxxxxx'x Entertainment, Inc. or its subsidiaries, while present at, and/or
specifically directing activities at, the Entertainment Facility.
14.2 Defense. Owner agrees to defend, promptly and diligently, at Owner's
expense, any claim, action or proceeding brought against Indemnified Persons or
Owner, jointly or severally, arising out of or connected with any of the matters
referred to in Article 14.1, and to hold harmless and fully indemnify each
Indemnified Person from any judgment, liability, loss or settlement on account
thereof. Defense of any such claim shall be accepted within ten (10) days after
the date tendered, or if sooner, when the first action in response to any such
claim is required. Defense shall be with counsel approved by the Indemnified
Person. Failure to accept
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any tender of a claim in writing within such period shall entitle an Indemnified
Person to conduct such defense and/or settle any such matter at Owner's sole
cost and expense. The allegation of facts which would excuse Owner's
indemnification obligation pursuant to 14.1(c) shall not excuse Owner's defense
obligation, and such obligation shall continue until gross negligence or wilful
misconduct of the type described in Article 14.1(c) is proven, by final
unappealable judgment, to have been the sole cause of liability (in which case
Owner shall be entitled to reimbursement from the Indemnified Person of all
reasonable attorneys fees and costs incurred in such defense).
ARTICLE 15
DAMAGE TO AND DESTRUCTION OF THE ENTERTAINMENT FACILITY
15.1 Obligation to Restore. At its cost, Owner agrees, subject to the provisions
of this Article 15, to repair, restore, rebuild or replace any damage to, or
impairment or destruction of, the Entertainment Facility from fire or other
casualty.
15.2 Termination Option. In the event the Building shall be destroyed
or substantially destroyed during the term of this Agreement by fire or other
casualty and Owner shall have maintained insurance as required by Article 13 of
this Agreement and shall not have committed or omitted or suffered any other to
commit or omit any act or omission resulting in any denial of coverage or
payment thereunder, then Owner shall have the right and option, upon notice
served upon the Manager within sixty (60) days after such fire or other
casualty, to terminate this Agreement. In the event of any such permitted
termination by Owner, Manager shall not be entitled to receive from Owner
damages described in Article 17.2, but shall be paid any other amounts due or
owing with respect to events occurring prior to or in connection with
termination of this Agreement (and Owner's obligations with regard thereto shall
survive such termination). If this Agreement is so terminated and the
Entertainment Facility is, at any time within the five (5) year period following
such casualty, nonetheless reconstructed and/or repaired by Owner for use as an
Entertainment Facility (including a hotel), Manager shall have the option to
re-institute this Agreement as to the reconstructed or repaired Entertainment
Facility for the unexpired portion of the Term.
If Owner fails to serve such notice within the time aforesaid, or if Owner
shall not have maintained adequate insurance as required by Article 13 or shall
have caused or suffered to occur
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any commission or omission resulting in any denial of coverage or payment, Owner
shall be obligated, at its cost, to repair, restore, rebuild or replace such
damage, impairment or destruction.
If Owner, for any reason, fails to complete any obligatory repair,
restoration, rebuilding or replacement in a continuous and expeditious manner
after the proceeds of insurance in respect of the fire or other casualty are
made available by the insurer, Manager may, at its election, terminate this
Agreement due to Owner's default, and collect the damages provided in Article
17.2, by delivery of written notice to Owner and without any other notice or
opportunity by Owner to cure such default.
ARTICLE 16
CONDEMNATION
16.1 Termination. If the whole of the Entertainment Facility shall be taken or
condemned in any eminent domain, condemnation, compulsory acquisition or like
proceeding by any competent authority for any public or quasi-public use or
purpose, or if such a portion thereof shall be taken or condemned as to make it
imprudent or unreasonable, in Owner's opinion (noticed to Manager in writing on
or before the effective date of such condemnation), to use the remaining portion
as an Entertainment Facility (including the hotel) for the use made immediately
preceding such taking or condemnation, then, in either of such events, this
Agreement shall cease and terminate as of the date of such taking or
condemnation. Manager shall not, in such event, be entitled to receive the
damages provided in Article 17.2 of this Agreement, but shall be paid any other
amounts due or owing to Manager with respect to events occurring prior to or in
connection with termination of this Agreement (and Owner's obligations with
regard thereto shall survive termination).
To the extent not theretofore paid by Owner, any amounts due and owing to
Manager with respect to events occurring prior to or in connection with the
termination of this Agreement, shall be paid from the first proceeds of any
award for such condemnation. Should any such award be inadequate, applied to
reduction of any debt encumbering the Entertainment Facility, or otherwise
applied to other purposes, Owner's obligation to pay amounts due Manager shall
continue unabated and shall not be limited to the amount of the award made
available to Owner.
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If this Agreement is so terminated, and the Entertainment Facility is
nonetheless reconfigured and/or reconstructed by Owner, at any time within the
five (5) year period following such taking or condemnation, Manager shall have
the option to reinstate this Agreement as to the restored Entertainment Facility
for the unexpired portion of the Term.
16.2 Restoration and Continuation. If only a part of the Entertainment
Facility is taken or condemned, and the taking or condemnation of such part does
not make it unreasonable or imprudent, in the opinion of Owner (noticed to
Manager in writing on or before the effective date of such condemnation), to
operate the remainder as an Entertainment Facility (including the hotel), this
Agreement shall not terminate. Out of any award to Owner, so much thereof as
shall be reasonably necessary to reconstruct the Entertainment Facility, or any
part thereof, or to reconfigure the Entertainment Facility, or any part thereof,
so as to render the Entertainment Facility (including the hotel) a complete and
satisfactory architectural unit of the same size and class as it was immediately
preceding the taking or condemnation shall be made available for that purpose.
The balance of the award, if any, after deduction of bona fide costs of
restoration by Owner, and any sums then due Manager, shall be fairly and
equitably apportioned between Owner and Manager so as to compensate Owner and
Manager for any loss of income resulting or to result from the taking or
condemnation.
Failure of Owner to effect repair and restoration of the Entertainment
Facility in a continuous and expeditious manner after the award of the condemnor
is made available in respect of any partial condemnation which Owner has not
deemed sufficient to render further operation of the Entertainment Facility
unreasonable or imprudent, shall be an Event of Default entitling Manager to
terminate this Agreement and collect the damages provided in Article 17.2
without further notice or opportunity by Owner to cure such default.
ARTICLE 17
DEFAULT AND TERMINATION
17.1 Events of Default. It shall be an event of default hereunder (an
"Event of Default") if any one or more of the following events shall occur:
(a) if there should occur a breach, default or noncompliance by a party hereto
with any covenants, obligations or agreements to be performed by a party
under this
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Agreement (except for matters described in Article 17.1(c) and (d)),
followed by written notice of such breach, default or non-compliance from
the Non-Defaulting Party to such Defaulting Party and failure of such
Defaulting Party to remedy or correct such breach, default or
non-compliance within thirty (30) days after receipt of such notice,
provided that, if such breach, default or non-compliance is other than
payment of money, failure to insure, or violation of Article 21.1 and 21.2,
and is also of a nature such that it cannot reasonably be cured within such
thirty (30) day period, then an Event of Default shall not be deemed to
have occurred for so long as the Defaulting Party commences the curing of
such default within such thirty (30) day period, pursues the completion
thereof with diligence and continuity, and completes such cure within
ninety (90) days of such notice; or,
(b) if Owner should fail to effect any required reconstruction of the Building
following casualty or partial condemnation, as and within the time provided
in Articles 15 and 16 of this Agreement;
(c) if:
(i) a party shall voluntarily or involuntarily be dissolved; apply for or
consent to the appointment of a receiver, trustee or liquidator of all
or a substantial part of its assets; file a voluntary petition in
bankruptcy (or have filed against it any such petition which shall not
have been dismissed within sixty (60) days after filing) or otherwise
seek protection of state laws for the relief of debtors; admit in
writing its inability to pay its debts as they become due; make a
general assignment for the benefit of creditors; file a petition (or
have filed against it any such petition which shall not have been
dismissed within sixty (60) days after filing) or an answer seeking to
be reorganized or arrangement with creditors or to take advantage of
any insolvency law or file an answer admitting the material
allegations of any petition filed against it in any bankruptcy,
reorganization or insolvency proceeding; or
- 40 -
(ii) an order, judgment or decree shall be entered by any court of
competent jurisdiction, on the application of any one or more
creditors of such party, adjudicating such party a bankrupt or
insolvent or approving a petition seeking reorganization or appointing
a receiver, trustee or liquidator of all or a substantial part of its
assets, and such order, judgment or decree shall become final; or
(iii) a party shall be directly or indirectly owned or controlled by
another company or entity and an event described in Sub-article (c)(i)
or (ii) shall occur with respect to any company or entity owning or
controlling such party; or
(d) (i) if Owner passes title to the Entertainment Facility or any part
thereof in lieu of foreclosure of any lien or other security interest
in the Entertainment Facility; or
(ii) if an action to foreclose any mortgage, deed of trust or other
security interest in the Entertainment Facility or any part thereof is
instituted against Owner and is not discharged or dismissed within
thirty (30) days thereafter.
The party responsible for the occurrence of an Event of Default or on
account of whom an Event of Default shall have occurred shall be called the
Defaulting Party. The remaining party, as to such Event of Default, shall be
called the Non-Defaulting Party.
The waiver of any one Event of Default shall not be construed as the waiver
of any other Event of Default. No waiver shall be effective unless embodied in a
writing signed by the Non-Defaulting Party.
17.2 Termination/Damages
(a) If an Event of Default occurs and has not been cured within any cure
period allowed above, this Agreement shall terminate at the election
of the Non-Defaulting Party. Notice of termination or suit for
specific performance, as appropriate, may be given or commenced at any
time after expiration of the applicable cure period, if any, and prior
to the curing of such Event of Default,
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and any termination shall be effective as of the date specified in
such notice of termination, which such date shall be not less than ten
(10) and not more than forty five (45) days after the date of such
notice. Owner's and Manager's indemnification and defense obligations
and Owner's obligation to maintain insurance after termination (with
respect to occurrences before termination) and to pay for all costs of
operating the Entertainment Facility prior to or in connection with
termination shall be in addition to and shall survive termination of
this Agreement and payment of damages therefor.
(b) If this Agreement is terminated as a result of an Event of Default by
Owner, then:
(i) if such Event of Default was caused: (A) solely by the act or
omission of Xxxxxx'x (Maryland) as partner of Owner or lessee of
an Operating Lease; or (B) the joint act or omission of Xxxxxx'x
(Maryland) and Players or a Players' Affiliate as co-partners of
Owner; or (C) by a title matter that was not created or after the
date hereof suffered by Owner; or (D) by a failure of Owner to
secure the Licenses and Permits required to construct or operate
the Entertainment Facility, then Manager shall be entitled to no
remedy other than termination or suit for specific performance as
provided in Article 17.2(a).
(ii) if such Event of Default was caused solely by the act or omission
of Players or a Players' Affiliate, as partner of Owner or lessee
of an Operating Lease, then it is the intent of the parties that
the remedies under the Owner's Partnership Agreement may be
invoked by Xxxxxx'x (Maryland) and that Manager shall receive
from Players, damages for such Event of Default (which may be
directly enforced or offset by Xxxxxx'x (Maryland) against the
Appraisal Buyout Price paid by Xxxxxx'x (Maryland) under Section
25 of Owner's Partnership Agreement) equal to: (i) the average
annual Management Fees earned by Manager under this Agreement
over the two (2) twelve (12) full Fiscal Month periods preceding
termination or, prior to the twenty-fifth (25th) full Fiscal
Month
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following the Opening Date, (ii) Two Hundred Eighty-Five Thousand
Dollars ($285,000). If Manager's Affiliate elects the Buy/Sell
remedy under Section 26 of Owner's Partnership Agreement, it is
the intent of the parties that (i) if Xxxxxx'x (Maryland) shall
be the purchaser, Xxxxxx'x (Maryland) shall be entitled to offset
against the Buy/Sell Price the damages above specified; and (ii)
if Xxxxxx'x (Maryland) shall be the seller, the Fair Market Value
of the Management Agreement, which must be purchased by Players
will equal the damages above specified.
(c) If there is an Event of Default by Manager, there shall be no remedy
against Manager other than termination of this Agreement without damages or
suit for specific performance.
ARTICLE 18
NOTICES
18.1 Procedure. All notices or other communications provided for in this
Agreement shall be in writing and shall be personally served, sent by Federal
Express or comparable express courier, or sent by postage prepaid certified mail
to the following addresses until such time as written notice, as provided
hereby, of a change of address with a new address to be used thereafter is
delivered the other party:
Owner: Riverside Joint Venture
Players International, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Manager: Xxxxxx'x Maryland Heights Operating Company
0000 Xxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: General Counsel
Such notice shall be effective upon receipt.
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ARTICLE 19
RELATIONSHIP, AUTHORITY AND FURTHER ACTIONS
19.1 Relationship. Manager and Owner shall not, by virtue of this
Agreement, be construed as joint venturers or partners of each other and neither
shall have the power to bind or obligate the other except as set forth in this
Agreement.
19.2 Contractual Authority. Manager is authorized to make, enter into and
perform in the name of, for the account of, on behalf of and at the expense of
Owner any contracts and agreements deemed necessary by Manager to carry out and
place in effect the terms and conditions of this Agreement. Manager shall
contract in a commercially reasonable manner; however, Manager shall not be
obligated to obtain Owner's approval of individual contracts or agreements
unless otherwise expressly provided in this Agreement.
19.3 Further Actions. Owner agrees to execute all contracts, agreements and
documents and to take all actions reasonably necessary (unless another standard
is provided) to comply with the provisions of this Agreement and the intent
hereof.
ARTICLE 20
APPLICABLE LAW AND ARBITRATION
20.1 Scope. The interpretation, validity and performance of this Agreement shall
be governed by the laws of the State of Missouri. If any court or appropriate
judicial authority shall hold or declare that the law of another jurisdiction is
applicable, this Agreement shall remain enforceable under the law of that
jurisdiction. If any of the terms and provisions hereof shall be held invalid or
unenforceable for any reason, such invalidity or unenforceability shall in no
event affect any of the other terms or provisions hereof, all such other terms
and provisions to be valid and enforceable to the fullest extent permitted by
law.
20.2 Arbitration
20.2.1 Matters Subject to Arbitration. In case of a dispute with respect to
any of the following matters, either party may submit such matter to arbitration
which shall be conducted by the Accountants:
(a) computation of (but not entitlement to) the Management Fees, Service
Fees or damages payable under Article 17.2(b);
(b) modifications to an Annual Plan or Operating Budget requested by
Manager;
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(c) results of any audit by Owner's Accountant;
(d) adjustment of any amounts required to be adjusted to reflect changes
in the Index;
(e) determination of whether, and to what extent, Manager has operated the
Entertainment Facility at a cost that entitles it to Incentive
Management Fee, including, without limitation, any disagreement over:
(i) the allocation of budgeted Operating Costs to any portion of a
Fiscal Year; or (ii) the amount of Operating Cost Savings;
(f) determination of the amount of additional employees (and resulting
increase in Compensation) and Administrative Service Fee reasonably
chargeable to Owner by reason of a termination of sharing of Shared
Employees.
The decision of the Accountants shall be binding on the parties.
20.2.2 The Accountants. The Accountants shall be one of three firms of
certified public accountants of recognized standing in the casino-hotel
industry. Until otherwise agreed by the parties, the Accountants shall be one of
Deloitte & Touche, Coopers & Xxxxxxx, and KPMG Peat Marwick. The party desiring
to submit any matter to arbitration shall do so by written notice to the other
party, which notice shall set forth the items to be arbitrated and such party's
choice of one of the three firms of accountants designated above. The party
receiving such notice shall, within fifteen (15) days after receipt of such
notice, either approve such choice or designate one of the remaining two firms
by written notice back to the first party, and the first party shall, within
fifteen (15) days after receipt of such notice, either approve such choice or
disapprove the same. For so long as Players is a Partner of Owner and not in
default under Owner's Partnership Agreement, the accounting firm representing
the Owner shall be chosen by Players. If both parties shall have approved one of
the three firms designated above, then such firm shall be the Accountants for
the purpose of arbitrating the dispute; otherwise the third firm, which was not
designated by either party shall be the Accountants for such purpose. The
Accountants shall be required to render a decision in accordance with the
procedures described in Article 20.2.3 within
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thirty (30) days after being notified of their selection. The fees and expenses
of the Accountants will be paid by the non-prevailing party.
20.2.3 Arbitration Procedures. In all arbitration proceedings submitted to
the Accountants, the Accountants shall be required to agree upon and approve the
substantive position advocated by Owner or Manager with respect to each disputed
item. Any decision rendered by the Accountants that does not adopt the
substantive position advocated by Owner or Manager shall be beyond the scope of
authority granted to the Accountants and consequently may be overturned by
either party. All proceedings by the Accountants shall be conducted in
accordance with the Uniform Arbitration Act as adopted in the State of Missouri,
except to the extent the provisions of such Act are modified by this Agreement
or the mutual agreement of the parties. Unless otherwise agreed, all arbitration
proceedings shall be conducted at the Entertainment Facility. Arbitration of any
dispute over an expenditure within a proposed Annual Plan or any revision
thereof for goods and services that Manager determines to be necessary for
compliance with Xxxxxx'x Operational Standards shall be limited to whether the
proposed expenditure is reasonable, considering the cost for which goods or
services meeting Xxxxxx'x Operational Standards may be obtained in the St.
Louis, Missouri market (or, in the case of specialized goods or services, the
applicable market for such goods or services). The substance of Xxxxxx'x
Operational Standards or Manager's determination of the manner of their
implementation shall not be arbitrated but shall remain within the sole
discretion of the Manager and its Affiliates.
ARTICLE 21
SUCCESSORS AND ASSIGNS
21.1 Assignment by Manager. Any act of, or with respect to, Manager that would
constitute a "Transfer" within the meaning of Owner's Partnership Agreement,
shall constitute an assignment hereunder. Owner's consent shall not be required
for Manager to assign any of its obligations or interests as Manager hereunder
to any Manager Affiliate or to any party who is a permitted transferee (or
wholly owned affiliate of such transferee) of the Project Property held by
Xxxxxx'x (Maryland) under Owner's Partnership Agreement, provided that any such
assignee is bound by the terms and conditions of this Agreement. Owner's advance
written consent shall be required for any other assignment of the obligations of
Manager under this Agreement, except
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for transactions which are excluded from the definition of "Transfer" in Section
4.125 of Owner's Partnership Agreement. Manager shall be released from liability
hereunder upon the conclusion of any permitted assignment.
Manager may, further, at all times without obtaining any consent from
Owner, assign, pledge, encumber and/or hypothecate all of Manager's rights, fees
(earned and unearned), interest in insurance, condemnation awards, indemnities
and other proceeds as security for a loan, and, in any such case, the assignee
shall hold and be entitled to enforce such rights and receive such fees and/or
payments without counterclaim, defense or setoff by Owner, Owner agreeing to
look solely to Manager and not to any such assignee in regard to any claim which
it may have under this Agreement. Notwithstanding the foregoing, Owner shall
have no obligation to assure the payment to any such assignee, of any amounts
received by Manager from the Entertainment Facility. Nothing herein shall impair
Owner's right to terminate the Agreement as provided herein.
21.2 Assignment or Transfer of Title by Owner. Any Transfer of Project
Property or any interest in a Holding Entity (as such terms are defined in
Owner's Partnership Agreement) by Players in violation of Owner's Partnership
Agreement shall be an Event of Default under this Agreement entitling Manager to
terminate this Agreement and receive damages from Players specified in Section
17.2. Any Transfer of Project Property or any interest in a Holding Entity (as
such terms are defined in Owner's Partnership Agreement) by Xxxxxx'x (Maryland)
in violation of Owner's Partnership Agreement shall be an Event of Default under
this Agreement entitling Owner to terminate this Agreement. Any Transfer of the
Entertainment Facility by Owner without the advance written approval of Manager
shall entitle Manager to terminate this Agreement by notice to Owner but not to
collect damages from Owner. Any transferee of the Entertainment Facility shall,
by acceptance of title, be deemed to have assumed all obligations of Owner under
this Agreement and shall deliver a written agreement so evidencing, upon demand,
in form satisfactory to Manager.
No transfer of any legal or beneficial interest in the Entertainment
Facility shall relieve Owner or Players of its obligations under this Agreement.
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21.3 Binding Effect. The terms, provisions, covenants, undertakings, agreements,
obligations and conditions of this Agreement shall be binding upon and shall
inure to the benefit of the permitted successors in interest and the permitted
assigns of the parties hereto with the same effect as if mentioned in each
instance where the party hereto is named or referred to, except that no
assignment, transfer, sale, pledge, encumbrance, mortgage, lease or sublease by
or through Owner in violation of the provisions of this Agreement shall vest any
rights under this Agreement in the assignee, transferee, purchaser, secured
party, mortgagee, pledgee, lessee, sublessee or occupant.
ARTICLE 22
SHORT FORM OF AGREEMENT
22.1 Memorandum of Agreement. On the Effective Date, Owner and Manager
shall execute, acknowledge and record a Short Form of this Agreement in the
public records for the County of St. Louis, Missouri, in the form attached as
Exhibit E.
ARTICLE 23
FORCE MAJEURE
23.1 Operation of Entertainment Facility. If it becomes necessary, in Manager's
opinion, to cease operation of the Entertainment Facility because of an
Emergency, then, in such event, Manager may close and cease operation of all or
part of the Entertainment Facility, reopening and commencing operation when
Manager deems in good faith that such Emergency has ended, provided that the
Term has not theretofore expired. Manager shall have no obligation to reopen the
Entertainment Facility if there shall be less than ninety (90) days remaining
unexpired in the Term at the time of such event.
Manager shall also be entitled, in the event of any labor organizational
activity, picketing or unrest, to designate specific entrances to the
Entertainment Facility as separate entrances for each of the separate businesses
conducted on Excursion Gambling Boats and the Entertainment Facility in order to
avoid tainting all entrances to the Entertainment Facility and harm to the
operation of the businesses that are not the target of such activity.
23.2 Extension of Time. It is further understood and agreed that, with
respect to any obligation to be performed under this Agreement by a party during
the Term (except for defaults in the
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nature of failure to make any required payment or maintain required insurance,
or transfer or assignment in violation of Article 21.2), such party shall not be
in default for failure so to do when and only for so long as such performance is
prevented by any force majeure cause beyond the reasonable control of such party
such as strike, lockout, breakdown, accident, order or regulation of or by any
governmental authority, failure of supply or inability, by the exercise of
reasonable diligence, to obtain supplies, parts or employees necessary to
perform such obligation, or war or other emergency. Notwithstanding the
foregoing, a failure by Owner to perform Owner's obligations due to a lack of
finances or due to a strike, lockout or failure of supply caused by the wrongful
act or omission of Owner, or its partners, or their affiliates that operate the
Excursion Gambling Boats or Excursion Gambling Boat Support Facilities, shall
not be deemed to be a cause beyond Owner's reasonable control. The time within
which such obligation shall be performed may be extended only for a period
equivalent to the delay caused by such force majeure.
ARTICLE 24
TERMINATION
24.1 Surviving Obligations. In the event of any termination or expiration of
this Agreement, Owner shall remain liable to pay all fees and other amounts due
to Manager for periods through termination, to maintain insurance for the
benefit of and indemnify Manager with respect to all occurrences before
termination, and to reimburse Manager for all expenses incurred by Manager
before or in connection with such termination or expiration. Manager's indemnity
obligations shall also survive termination or expiration of this Agreement.
24.2 Termination/Expiration. In connection with the expiration and/or
termination of this Agreement:
(a) Manager shall:
(i) deliver possession of the Entertainment Facility to Owner or
Owner's designated agents or employees subject to rights of all
parties in possession, in "as is" condition, without recourse or
any warranty whatsoever;
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(ii) deliver to Owner any written Operating Agreements with respect to
the Entertainment Facility which have not theretofore been
delivered to Owner;
(iii) prepare and furnish to Owner a list of guest room reservations
for the hotel within the Entertainment Facility and a list (with
copies) of all room allocation and Entertainment Facility service
agreements for the Entertainment Facility (which have not
theretofore been furnished to Owner) for all periods after
expiration or termination;
(iv) advise all Entertainment Facility purveyors by mail of the change
of control of the Entertainment Facility;
(v) permit Owner to have an observer at the Entertainment Facility to
coordinate the turnover of Entertainment Facility operations for
a period of seven (7) days prior to expiration or termination,
provided that such observer shall not participate in the
operation or management of the Entertainment Facility, give any
direction to or contact any Entertainment Facility employee or
otherwise interfere with Manager's operation of the Entertainment
Facility, as determined by Manager's general manager, in his sole
discretion. If such observer shall be deemed by any of Manager's
Key Personnel to interfere with Entertainment Facility
operations, then such observer may be required to leave the
Entertainment Facility immediately upon notice from Manager;
(vi) deliver to Owner records of the Entertainment Facility pertaining
to:
(1) accounts payable outstanding and unpaid at termination or
expiration, provided that Manager shall, to the extent funds
are made available therefor by Owner and amounts due are
then known, pay all accounts payable through and including
the date of expiration or termination;
(2) accounts receivable outstanding and uncollected at
termination or expiration, all of which Owner agrees shall
be accounted for by
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Owner when collected by Owner or Manager as Gross Revenues
under this Management Agreement; and
(3) employees who are hired by Owner and remain at the
Entertainment Facility following termination or expiration
of the Management Agreement (to the extent the information
in such files is not deemed confidential by Manager).
(vii) After deducting therefrom any amounts due and payable under this
Agreement and not theretofore paid, Manager shall disburse the
balance, if any, remaining in the Bank Account(s) after termination or
expiration of this Agreement to Owner.
(b) Owner shall be solely responsible for and shall pay all costs of:
(i) cancelling any Operating Agreements which Owner does not wish to
continue after such termination or expiration; or
(ii) assuming and continuing performance under any such Operating
Agreements which Owner desires to retain in effect.
(c) Owner shall, without limiting Owner's obligation as employer, be solely
responsible and shall pay for all severance or other termination benefits
due any employee of Manager whose services are terminated;
(d) Owner shall, in the event of termination of this Agreement in connection
with any termination involving a change of hotel brand identification or
affiliation, as of the date of termination or expiration:
(i) cooperate in the removal of all signage identifying the Entertainment
Facility as a Xxxxxx'x(R) hotel or containing any Xxxxxx'x System Xxxx
and, in the case of any such signage supplied pursuant to an
advertising contract (as in the case of billboard advertisements) pay
all costs necessary to repaint or otherwise re-identify the
Entertainment Facility and remove any Xxxxxx'x System Marks from such
advertisement;
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(ii) cease use of any Xxxxxx'x System Xxxx at the Entertainment Facility
and shall destroy any personal property bearing such designation
unless otherwise authorized in writing by Manager;
(iii) cause the telephone number and all telephone advertisements for the
Entertainment Facility to be changed to different telephone numbers to
de-identify the Entertainment Facility as a Xxxxxx'x(R) hotel; and
(iv) cooperate with Manager and the supplier thereof to permit the removal
of any proprietary system owned by or licensed solely to Manager or
Manager's Affiliates at the Entertainment Facility and shall not move
or disturb such equipment and shall be solely responsible for any
damage to such system for any period after termination or expiration
of this Agreement during which the equipment is stored at the
Entertainment Facility, provided however, that such equipment shall,
subject to force majeure, be removed from the Entertainment Facility
within ten (10) days after termination or expiration of this
Agreement, and provided further that Owner shall not be responsible
for any damage to such equipment caused by the parties effecting its
removal.
(e) Owner shall, after termination or expiration, continue to honor all guest
room reservations, room allocation agreements, and other advance bookings
in accordance with their terms and if requested by the party holding same,
cancel any such agreement and refund any deposit made therefore (which has
either been delivered or credited by Manager to Owner on termination or
expiration of this Agreement or received directly by Owner or its
employees, agents or independent contractors), should any such party
request cancellation and refund because the Entertainment Facility is no
longer a Xxxxxx'x(R)hotel; and
(f) Owner shall, without limiting the foregoing, indemnify, defend and hold
Manager harmless from and against all loss, cost, claim or damage relating
to events arising at the Entertainment Facility or its operation or
ownership: (i) before termination
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(except for matters excluded by Article 14.1(c)); and (ii) after
termination or expiration of this Agreement, without regard to Article
14.1(c).
The foregoing shall be covenants running with the Entertainment Facility, shall
survive termination or expiration of this Agreement, and shall be specifically
enforceable by Manager and Owner.
ARTICLE 25
GENERAL PROVISIONS
25.1 Authorization. Owner represents that it has full power and authority
to execute this Agreement and to be bound by and perform the terms hereof.
Manager represents it has full power and authority to execute this Agreement and
to be bound by and perform the terms hereof. On request, each party shall
furnish the other evidence of such authority.
25.2 Interest. Any amount payable to Manager which shall not be paid when
due shall accrue interest at the lesser of: (a) the highest legal limit, or (b)
eight percent (8%) over the Interest Rate.
25.3 Formalities. Any change to or modification of this Agreement must be
in writing signed by both parties hereto. This Agreement shall be executed in
one or more counterparts, each of which shall be deemed an original. The
captions for each Article are intended for convenience only.
25.4 Documents. Throughout the term hereof, Owner shall furnish Manager
copies of all documents, as-built plans of the Entertainment Facility,
warranties and guaranties, paid property tax and insurance statements, all
financing documents (including notes and mortgages) relating to the
Entertainment Facility and such other documents pertaining to the Entertainment
Facility as Manager shall request.
25.5 Personal Service Contract. This Agreement shall be construed as a
personal service contract which may not be assigned by Owner or Owner's
representatives in any bankruptcy, receivership, insolvency or similar
proceedings.
25.6 Exhibits. All Exhibits referred to in and attached to this Agreement
are, by such reference, intended to be incorporated within and made a part of
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement effective as of the day and year first above written.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE
ENFORCED BY THE PARTIES.
OWNER:
RIVERSIDE JOINT VENTURE
By: XXXXXX'X MARYLAND HEIGHTS CORPORATION,
a Nevada corporation, its General Partner
By: /s/ Xxxxxx Xxxxxxxx
--------------------------------------
Its: Authorized Representative
--------------------------------------
By: PLAYERS MH, L.P., a Missouri limited
partnership, its General Partner
By: PLAYERS MARYLAND HEIGHTS, INC.,
a Missouri corporation, its sole General Partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Its: Secretary
----------------------------
MANAGER:
XXXXXX'X MARYLAND HEIGHTS
OPERATING COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
-------------------------------------
Its: Authorized Representative
------------------------------------
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