Exhibit 10.14
MANAGER SUBORDINATION AGREEMENT
(Landlord)
THIS MANAGER SUBORDINATION AGREEMENT (Landlord) (as amended,
modified or supplemented from time to time, this "Agreement") dated as of
October 29, 1998, is entered into by and among the RIVERGATE DEVELOPMENT
CORPORATION, a Louisiana public benefit corporation (the "RDC"), the CITY OF NEW
ORLEANS (the "City" and, together with the RDC, "Landlord") and XXXXXX'X NEW
ORLEANS MANAGEMENT COMPANY, a Nevada corporation (the "Manager"). All
capitalized terms used and not otherwise defined herein shall have the meaning
assigned to such terms in the Lease (as defined herein).
RECITALS
X. Xxxxxx'x Jazz Company, a Louisiana general partnership
("HJC"), filed a voluntary petition for relief under Chapter 11 of the United
States Bankruptcy Code on November 22, 1995, which case is now pending in the
United States Bankruptcy Court for the Eastern District of Louisiana, Case No.
95-14545.
B. HJC has submitted a Third Amended Joint Plan of
Reorganization, as modified (the "Plan"), in connection with that certain
voluntary petition for relief under Chapter 11 of the United States Bankruptcy
Code and such Plan has been confirmed by the United States Bankruptcy Court for
the Eastern District of Louisiana.
C. As contemplated by the Plan, Jazz Casino Company, L.L.C., a
Louisiana limited liability company (the "Company"), has succeeded to all the
rights and obligations of HJC.
D. The Manager has entered into that certain Second Amended
and Restated Management Agreement (as so amended and restated, and as the same
may be further amended, modified, replaced, restated, supplemented, renewed, or
extended from time to time, the "Management Agreement") with the Company,
pursuant to which the Manager will manage the Casino.
E. Contemporaneously herewith the Company, the RDC, and the
City have entered into that certain Amended and Restated Lease Agreement (the
"Lease").
F. The Landlord has requested that the Manager execute and
deliver this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto agree as follows:
1. CONSENT TO LEASE. Manager acknowledges that the Landlord
has, under the Lease, (i) an interest in the Improvements and a potential right
to lease Tenant's Property pursuant to Section 5.3 of the Lease, (ii) certain
rights to moveable and immovable property under Sections 5 and 7 of the Lease
and (iii) certain rights with respect to the House Bank and the Capital
Replacement Fund under Sections 5, 7 and 19 of the Lease.
2. SUBORDINATION. The Manager hereby covenants and agrees that
the payment of any Base Fees, Incentive Fees and Termination Fees (each as
defined in the Management Agreement) owing by the Company to the Manager or an
Affiliate of Manager is hereby expressly subordinated to the prior payment in
full in cash of all Rent and Additional Charges under the Lease.
3. TRANSITION.
3.1. Transition Period and Transaction Period Commencement
Date. The "Transition Period" shall be that period of time during which
Transition Actions (as defined in Section 3.2 hereof) are to be taken. The
Transition Period shall begin on the date (the "Transition Period Commencement
Date") on which (i) the Landlord or its receiver or conservator is placed in
ownership, possession or control of the Casino or (ii) an Event of Default has
occurred pursuant to Section 21.l(n) of the Lease and all cure periods in favor
of Leasehold Mortgagees under Section 23.4 of the Lease have expired and, with
respect to either (i) or (ii) above, either (a) the Manager terminates or
breaches the Management Agreement by failing to comply with Section 17.02(a) of
the Management Agreement, (b) there is an inability to use the System Marks at
the Development for any reason, or (c) Manager terminates the use at the Casino
of the Proprietary Systems (as defined in the Management Agreement) at a time at
which there is not available for use at the Casino a replacement for such
systems from a third party; provided, however, the Transition Period
Commencement Date shall not occur during any period in which Landlord's right to
take ownership, possession or control of the Casino is delayed as a result of
any forbearance by Landlord pursuant to Section 8 hereof. Notwithstanding
anything herein to the contrary, the Transition Period shall terminate no later
than forty-five (45) days after the Transition Period Commencement Date.
3.2. Transition Actions. For purposes of this Agreement,
"Transition Actions" are:
(a) Manager shall remove Manager's Property from the
Casino and replace (except as set forth in Section 3.2(b) hereof) with items of
like kind and quality, any tangible Manager's Property which is essential to the
operations of the Casino and would not customarily be supplied by a new manager,
including, in the case of the appointment of a receiver or conservator, the
supplying of such items by such receiver or conservator.
(b) Manager shall remove Confidential and Proprietary
Information (as defined in Section 12.02(c) of the Casino Management Agreement)
from the Casino.
(c) Manager shall remove any System Marks from the
Improvements and Tenant's Property. In the event that System Marks are removed
by Manager from the
Improvements or Tenant Property and such act results in destruction of such
Improvements or Tenant's Property or material damage to such Improvements or
Tenant's Property which is not or cannot be repaired by Manager, then Manager
shall replace such Improvements or Tenant's Property with property of like kind
and quality, as the case may be.
3.3. Manager's Property Not Removed. If a Transition Period
has commenced and expired pursuant to Section 3.1 hereof or Manager has
surrendered possession of the Casino and Manager fails to remove any of
Manager's Property from the Casino, Landlord shall deliver to Manager written
notice of Landlord's demand that Manager remove any such Manager's Property and
shall give Manager fifteen (15) days to remove the property identified in such
notice and Landlord and Tenant shall provide Manager access to the Casino for
such purpose. If Manager then fails to remove the Manager's Property identified
in the notice or any remaining Manager's Property, Landlord shall have the right
to remove such property and to dispose of the same without incurring liability
to Manager, and Landlord may claim ownership to such property and use such
property as its own regardless of any Marks or System Marks; provided that
Landlord shall have no right to claim any ownership or, except as otherwise
provided in this Agreement, other rights with respect to any such Marks or
System Marks.
3.4. Transition Cooperation. If (i) Landlord gives to the
Company a notice of termination pursuant to Section 21.3 of the Lease or (ii)
Manager gives to the Company notice of termination pursuant to Section 17.02(a)
of the Management Agreement, Manager shall cooperate with the Landlord and any
successor manager to effect an orderly transition of the management of the
Casino without interruption of operations. Such transition cooperation shall be
furnished for a term not to exceed forty-five (45) days from the first to occur
of either the Landlord's notice of termination under the Lease or the Manager's
notice of termination under the Management Agreement; except that in no event
will the obligations under this Section 3.4 arise or continue to run if: (a)
Manager is not being paid on a current basis all amounts due to it under the
Management Agreement (excluding any amounts due prior to the date on which
Landlord or its receiver or conservator assume control of the Casino); or (b)
the Company, Landlord or Landlord's receiver or conservator is not paying on a
current basis the Company's other obligations with respect to the operation of
the Casino; or (c) Manager's performance of any transition cooperation would
require it to incur any out-of-pocket expenses or to take such action without
being compensated or at material risk of not being compensated.
3.5. Limitation on Rights of Landlord. This Manager
Subordination Agreement grants rights to Landlord only as specifically stated
herein. Nothing herein shall be construed to limit or modify the rights of
Manager to remove Manager's Property from the Casino which should be exercised
in good faith with a minimum of disruption to the Casino operations.
3.6. Limitation on Rights Against Landlord. The Manager's
right to receive or set off any monies or obligations owed or accruing or to be
performed by the Company shall not be enforceable against the Landlord (or its
nominee or designee), and the Landlord (or its nominee or designee) shall have
no obligation to remedy any act or omission of the Company or any default or
event of default on the part of the Company accruing, occurring or existing
under
the Management Agreement. Notwithstanding anything contained in this Manager
Subordination Agreement or any rights granted Manager hereunder, Manager shall
not be a third-party beneficiary to the Lease.
3.7. Remedies. The remedies available to the Landlord for the
enforcement of the provisions of this Section 3 shall include, without
limitation, the right of specific performance and the right to obtain an
injunction without posting a bond therefor; provided, however, that nothing
shall limit the Landlord's right to pursue any legal remedy for a breach of this
Agreement.
4. AMENDMENT. No modification, amendment, waiver or release of
any provision of this Agreement or of any right, obligation, claim or cause of
action arising hereunder shall be valid or binding for any purpose whatsoever
unless in writing and duly executed by the Manager and the Landlord.
5. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Louisiana as
applied to contracts made and performed entirely within the State of Louisiana
(without applying any provisions related to conflicts of laws). The Manager
hereby consents to the jurisdiction of the courts of the State of Louisiana and
consents to service of process by any means authorized by Louisiana law in any
action brought under or arising from this Agreement.
6. THIRD PARTY BENEFICIARIES. This Agreement is entered into
for the benefit of the Landlord and may not be amended or modified in any
respect, or terminated, without the consent of the Landlord. The provisions of
this Agreement are continuing provisions and all obligations to which they apply
shall conclusively be presumed to have been created in reliance thereon. Except
as otherwise expressly set forth herein, no provision of this Agreement shall be
deemed to modify, or release the Company from, any of the Management Agreement
obligations (except to the extent payment thereof is deferred or prohibited
pursuant to the Management Agreement or this Agreement), including, without
limitation, the obligation to pay the Termination Fee under the Management
Agreement or to grant the Company any additional rights under the Management
Agreement.
7. TERMINATION. This Agreement shall terminate on the first to
occur of (i) the termination of the Management Agreement and either (a)
completion of any Transition Actions required by this Agreement or (b)
completion of any transition obligations of the Manager under the Management
Agreement, whichever are applicable to the circumstances, and, with respect to
either (a) or (b), completion of the transition to a new manager as contemplated
in the Lease or (ii) the expiration of the Transition Period and satisfaction of
any of Manager's obligations pursuant to Sections 3.3 and 3.4 hereof.
8. MANAGEMENT AGREEMENT. Nothing in this Agreement shall
obligate Manager to breach or default under any of its obligations to the
Company under the Management Agreement or any agreement in favor of a Leasehold
Mortgagee. In the event of any conflict between this Agreement on the one hand
and either the Casino Management Agreement or any agreements including Leasehold
Mortgagees as parties on the other hand, the
Landlord shall forbear as to any rights or remedies under this Agreement which
are in conflict with the rights and remedies of any Leasehold Mortgagees or of
the Tenant so long as such parties have a right to cure or a right to a new
lease pursuant to the terms of the Lease.
9. NOTICES. Except as otherwise specified herein, all notices,
requests, demands or other communications to or upon the respective parties
hereto shall be deemed to have been duly given or made when delivered to the
party to which notice, request, demand or other communication is required or
permitted to be given or made under this Agreement, addressed as follows:
(a) if to the Manager, at
Xxxxxx'x New Orleans Management Company
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: General Counsel
(b) (b) if to the Landlord, as provided in the Lease,
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
[Signature page follows]
IN WITNESS WHEREOF, the Manager and the Landlord have caused
this Agreement to be duly executed and delivered as of the date first written
above.
Witnesses: XXXXXX'X NEW ORLEANS
MANAGEMENT COMPANY,
a Nevada corporation
/s/ Xxxx Xxxx By: /s/ X.X. Xxxxxxxx XX
--------------------------- -------------------------------
/s/ Xxxxxx Xxxxx Name: Xxxxxx X. Xxxxxxxx XX
--------------------------- -------------------------------
Title: Asst. Sec'y
-------------------------------
THE CITY OF NEW ORLEANS
By:
--------------------------- -------------------------------
Name:
-------------------------------
Title:
--------------------------- -------------------------------
RIVERGATE DEVELOPMENT CORPORATION
By:
--------------------------- -------------------------------
Name:
-------------------------------
Title:
--------------------------- -------------------------------
Acknowledged and accepted:
JAZZ CASINO COMPANY, L.L.C.,
a Louisiana limited liability company Witnesses:
By:
-------------------------------- ----------------------------------
Name:
--------------------------------
Title:
------------------------------- ----------------------------------
IN WITNESS WHEREOF, the Manager and the Landlord have caused
this Agreement to be duly executed and delivered as of the date first written
above.
Witnesses: XXXXXX'X NEW ORLEANS
MANAGEMENT COMPANY,
a Nevada corporation
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
THE CITY OF NEW ORLEANS
/s/ Xxxxxxxxx X. Xxxxxxx By: /s/ Xxxx X. Morial
--------------------------- -------------------------------
/s/ Xxxxxxx Xxxxxxx Name: Xxxx X. Morial
--------------------------- -------------------------------
Title: Mayor
-------------------------------
RIVERGATE DEVELOPMENT CORPORATION
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
Acknowledged and accepted:
JAZZ CASINO COMPANY, L.L.C.,
a Louisiana limited liability company Witnesses:
By:
---------------------------------- ----------------------------------
Name:
--------------------------------
Title: President
------------------------------- ----------------------------------
IN WITNESS WHEREOF, the Manager and the Landlord have caused
this Agreement to be duly executed and delivered as of the date first written
above.
Witnesses: XXXXXX'X NEW ORLEANS
MANAGEMENT COMPANY,
a Nevada corporation
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
THE CITY OF NEW ORLEANS
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title: Mayor
-------------------------------
RIVERGATE DEVELOPMENT CORPORATION
/s/ Xxxxxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
--------------------------- -------------------------------
/s/ Xxxxxxx Xxxxxxx Name: Xxxxx X. Xxxxxxx
--------------------------- -------------------------------
Title:
-------------------------------
Acknowledged and accepted:
JAZZ CASINO COMPANY, L.L.C.,
a Louisiana limited liability company Witnesses:
By:
---------------------------------- ----------------------------------
Name:
--------------------------------
Title: President
------------------------------- ----------------------------------
IN WITNESS WHEREOF, the Manager and the Landlord have caused
this Agreement to be duly executed and delivered as of the date first written
above.
Witnesses: XXXXXX'X NEW ORLEANS
MANAGEMENT COMPANY,
a Nevada corporation
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
THE CITY OF NEW ORLEANS
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
RIVERGATE DEVELOPMENT CORPORATION
By:
--------------------------- -------------------------------
Name:
--------------------------- -------------------------------
Title:
-------------------------------
Acknowledged and accepted:
JAZZ CASINO COMPANY, L.L.C.,
a Louisiana limited liability company Witnesses:
By: /s/ Xxxxxxxxx X. Xxxxxxx /s/ Xxxx Xxxx Hertz
---------------------------------- ----------------------------------
Name: Xxxxxxxxx X. Xxxxxxx
--------------------------------
Title: President [illegible]
------------------------------- ----------------------------------
Xxxxxx'x Las Vegas, Inc., a Nevada corporation, represents
that it is the owner of the System Marks (as defined in the Management
Agreement) and has licensed Manager's use of the System Marks pursuant to the
Management Agreement. Xxxxxx'x Las Vegas, Inc. acknowledges and consents to the
provisions of Section 3 of the foregoing Manager Subordination Agreement
(Landlord), and to the extent inconsistent with the terms of any license
agreement between Xxxxxx'x Las Vegas, Inc. and Manager, the terms of this
Agreement shall control. Xxxxxx'x Las Vegas, Inc. agrees to cooperate in good
faith in the implementation of the intent of this Agreement.
XXXXXX'X LAS VEGAS, INC.
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
--------------------------------
Title: Asst. Secretary
-------------------------------
ACKNOWLEDGMENT
STATE OF New York
COUNTY OF New York
BE IT KNOWN, that on this 28th day of October, 1998,
BEFORE ME, the undersigned authority, duly commissioned,
qualified and sworn within and for the State and County aforesaid,
PERSONALLY CAME AND APPEARED:
Xxxxxx X. Xxxxxxxx, XX, appearing in his capacity as Authorized
Representative of XXXXXX'X NEW ORLEANS MANAGEMENT COMPANY, a Nevada
corporation,
to me personally known to be the identical person whose name is subscribed to
the foregoing instrument; who declared and acknowledged to me, Notary, in the
presence of the undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority and that the said instrument is
the free act and deed of the said corporation and was executed for the uses,
purposes and benefits therein expressed.
WITNESSES:
/s/ W. Xxxx Xxxxxx /s/ X. X. Xxxxxxxx XX
-------------------------------- -----------------------------
/s/ Xxxxx X. Xxxxxxx
--------------------------------
/s/ Xxxxx Xxxxx Xxxx
----------------------------
NOTARY PUBLIC
XXXXX XXXXX XXXX
Notary Public, State of New York
No. 01j05069330
Qualified in New York County
Commission Expires Nov. 25, 1998
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 29th day of October, 1998,
BEFORE ME, the undersigned authority, duly commissioned,
qualified and sworn within and for the State and Parish aforesaid,
PERSONALLY CAME AND APPEARED:
Xxxx X. Morial, appearing in his capacity as Mayor of
THE CITY OF NEW ORLEANS,
to me personally known to be the identical person whose name is subscribed to
the foregoing instrument; who declared and acknowledged to me, Notary, in the
presence of the undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority and that the said instrument is
the free act and deed of the said corporation and was executed for the uses,
purposes and benefits therein expressed.
WITNESSES:
----------
/s/ Xxxxxxxxx X. Xxxxxxx /s/ Xxxx X. Morial
-------------------------------- --------------------------------
/s/ Xxxxxxx Xxxxxxx
--------------------------------
[illegible]
-------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 29th day of October, 1998,
BEFORE ME, the undersigned authority, duly commissioned,
qualified and sworn within and for the State and Parish aforesaid,
PERSONALLY CAME AND APPEARED:
Xxxxx X. Xxxxxxx, appearing in his capacity as the President of
RIVERGATE DEVELOPMENT CORPORATION,
to me personally known to be the identical person whose name is subscribed to
the foregoing instrument; who declared and acknowledged to me, Notary, in the
presence of the undersigned competent witnesses, that she executed the same on
behalf of said corporation with full authority and that the said instrument is
the free act and deed of the said corporation and was executed for the uses,
purposes and benefits therein expressed.
WITNESSES:
/s/ Xxxxxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxxx
----------------------------------- ----------------------------
/s/ Xxxxxxx Xxxxxxx
-----------------------------------
--------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 26th day of October, 1998,
BEFORE ME, the undersigned authority, duly commissioned,
qualified and sworn within and for the State and Parish aforesaid,
PERSONALLY CAME AND APPEARED:
Xxxxxxxxx X. Xxxxxxx, appearing in his capacity as the Authorized
Representative of JAZZ CASINO COMPANY, L.L.C., a Louisiana
limited liability company.
to me personally known to be the identical person whose name is subscribed to
the foregoing instrument; who declared and acknowledged to me, Notary, in the
presence of the undersigned competent witnesses, that he executed the same on
behalf of said limited liability company with full authority and that the said
instrument is the free act and deed of the said limited liability company and
was executed for the uses, purposes and benefits therein expressed.
WITNESSES:
/s/ Xxxx Xxxx Xxxxx /s/ Xxxxxxxxx X. Xxxxxxx
------------------------------ ------------------------------------
[illegible]
------------------------------
/s/ Xxxxxx X. Xxxxxxxxx
---------------------------------
NOTARY PUBLIC
XXXXXX X. XXXXXXXXX
NOTARY PUBLIC
State of Louisiana
My Commission Is Issued for Life.
ACKNOWLEDGMENT
STATE OF Tennessee
COUNTY OF Shelby
BE IT KNOWN, that on this 27th day of October, 1998,
BEFORE ME, the undersigned authority, duly commissioned,
qualified and sworn within and for the State and County aforesaid,
PERSONALLY CAME AND APPEARED:
Xxxx X. Xxxxx, appearing in his capacity as the Authorized
Representative of XXXXXX'X LAS VEGAS, INC., a Nevada corporation,
to me personally known to be the identical person whose name is subscribed to
the foregoing instrument; who declared and acknowledged to me, Notary, in the
presence of the undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority and that the said instrument is
the free act and deed of the said corporation and was executed for the uses,
purposes and benefits therein expressed.
WITNESSES:
Xxxx X. Xxxxxxx /s/ Xxxx X. Xxxxx
------------------------------ -----------------------------------
Xxxxxxx X. Xxxxxxx
------------------------------
Xxxxxx X. Xxxxx
--------------------------------
NOTARY PUBLIC
My Commission Expires Jan. 17, 2001
