EXECUTION COPY
DEVELOPMENT SERVICES AGREEMENT
THIS DEVELOPMENT SERVICES AGREEMENT (hereinafter referred to as the "Agreement") is
made as of he 20th day of March, 2001 by and among the Xxxxxxxxxxx-Xxxxxx Band of Mohican
Indians of Wisconsin, a federally recognized Indian tribe (hereafter referred to as the
"Tribe"), the Xxxxxxxxxxx-Xxxxxx Tribal Gaming Authority, an instrumentality of the Tribe,
(hereinafter referred to as the "Authority"), Trading Cove New York, LLC, a Delaware
Limited Liability Company (hereinafter referred to as the "Developer"), Sun International
North America, Inc., a Delaware corporation (hereinafter referred to as "SINA") and
Waterford Gaming Group, LLC, a Delaware limited liability company (hereinafter referred to
as "Waterford"). SINA and Waterford are hereinafter collectively referred to as the
"Developer Guarantors".
RECITALS
--------
A. The Tribe is an Indian Tribe recognized by the United States of America with a
reservation located in the State of Wisconsin. The Tribe currently owns and operates a
Class III gaming facility, as defined in the Indian Gaming Regulatory Act ("IGRA"), on its
reservation in Wisconsin. The Tribe also has a land claim pending in the State of New York,
as articulated in the action entitled The Xxxxxxxxxxx-Xxxxxx Community vs. The State of New
--------------------------------------------------------
York, et al., United States District Court, Northern District of New York, Docket No.
-------------
86-CV-1140 (the "Land Claim").
B. The Authority, on behalf of the Tribe, intends to develop and operate in the
State of New York a Class II and Class III gaming facility with slot machines and table
games of size and scope to be agreed upon by the parties (the "Gaming Facility"), together
with appropriate ancillary facilities including, a luxury hotel with customary amenities, a
convention/events center, food and beverage outlets, retail facilities, parking facilities
and other related infrastructure, and any modifications of the foregoing elements agreed to
by the parties during the Term of this Agreement (the "Ancillary Facilities"). (The Gaming
Facility and the Ancillary Facilities and any modifications or additions thereto whenever
constructed are collectively referred to herein as the "Facility" and/or the "Project").
The Project shall be constructed on property to be acquired by the Tribe in the State of New
York in furtherance of this Agreement (the "Property") to be put in trust for the benefit of
the Tribe by the United States of America, pursuant to the Tribe's recognized powers of
self-government and the statutes and ordinances of the Tribe. The Property will be acquired
by the Tribe through the "best interests" provisions of IGRA and/or through the settlement
of its Land Claim under IGRA (25 U.S.C.§.2719(b)(1)(A) and (B), respectively).
C. The Authority will operate the Project to improve the economic conditions of the
Tribe's members and in accordance with the Compact and related agreements to be negotiated
by the Tribe with the State of New York.
D. Developer is a Delaware limited liability company whose members consist of the
Sun Cove New York, Inc., a Delaware corporation and Waterford Development New York, LLC., a
Delaware limited liability company. The Developer, through its members, has experience and
expertise related to real estate acquisitions, financing, development, construction and
operation of gaming facilities and hotel resorts, including Native American Indian gaming
facilities and hotel resorts. The Developer has the requisite skill, resources and
experience to perform its obligations under this Agreement
E. The Tribe and the Developer entered into a Memorandum of Understanding (the "MOU")
on August 15, 2000.
F. Subject to the terms and conditions of this Agreement, the Developer will provide
to the Tribe and/or the Authority: (1) assistance in locating and acquiring the Property,
including certain funding towards the acquisition cost of the Property, (2) certain funding
of development costs associated with the Project, (3) assistance in arranging bank and/or
bond financing (the "Senior Financing", as defined below), (4) if necessary and required by
the Senior Lenders, subordinated debt financing (the "Junior Financing", as defined below)
and/or a completion guarantee (the "Completion Guarantee", as defined below), (5) exclusive
development services related to the Project and any expansion of the Project, (6) assistance
with settlement of the Tribe's New York land claim and the Tribe's BIA fee to trust
application, (7) assistance in negotiating a local government agreement, and (8) assistance
with negotiation of the Compact, all as more particularly described in this Agreement.
G. The Authority desires to grant the Developer the exclusive right and obligation
to provide development services in respect of the design, construction, equipping and
opening of the Project upon the terms and conditions set forth herein.
H. It is the intent of the parties that nothing in this Agreement or the "Financing
Agreements" (as hereinafter defined) shall place at risk any asset of a Tribal member or the
Tribe's assets located in the State of Wisconsin or any property or assets located in the
State of New York which are unrelated to the Project and this Agreement (or any income or
other funds generated from such assets).
I. The Developer Guarantors join in this Agreement for the sole purpose of
guaranteeing Developer's obligations as provided for in Section 13.21 of this Agreement.
NOW THEREFORE, in consideration of the mutual covenants, conditions and promises
herein contained, the receipt and sufficiency of which hereby are acknowledged, the
Authority, the Tribe and the Developer agree as follows:
ARTICLE 1
CERTAIN DEFINITIONS
1.1 Definitions. Capitalized terms used in this Agreement shall have the meanings
-----------
set forth below:
"Affiliate" means, with respect to the Person in question, any Person controlling,
controlled by or under common control with, such Person. For the purposes hereof, "control"
means the possession, directly or indirectly, or the power to direct or cause the direction
of the management or policies of the Person in question.
"Affiliate Transactions" has the meaning set forth in Section 10.2 below.
"Agreement" shall have the meaning ascribed to it in the first paragraph hereof and
means this Agreement including, without limitation, the Recitals, together with the
Exhibits, each of which is incorporated herein and made a part hereof, all as amended in
accordance with the terms hereof.
"Ancillary Facilities" has the meaning set forth in Recital B hereof.
"Architect" means, as applicable from time to time, the Design Architect and/or the
Architect of Record for the Project engaged pursuant to Section 4.2 below.
"Architect of Record" means the Architect selected by the Developer and the Authority
for the Project which Architect shall be licensed to practice by the State of New York.
"Authority" means the Xxxxxxxxxxx-Xxxxxx Tribal Gaming Authority, or any other
instrumentality of the Tribe with the authority to exercise the proprietary authority of the
Tribe over the gaming and/or non-gaming facilities located on the Property in accordance
with the Xxxxxxxxxxx-Xxxxxx Tribal Constitution, the Tribe's Gaming Ordinance, the Tribe's
ordinance establishing the Authority, the Compact, the IGRA or other applicable law, or any
successor and assignee thereto.
"Average Gaming Facility Revenues" means the average monthly Revenues of the Gaming
Facility for the twelve (12) months ending with (and including) the month immediately prior
to the month in which a Casualty Event occurs.
"Budget" means the Project Budget.
"Bureau of Indian Affairs" or "BIA" is the Bureau of Indian Affairs of the Department
of the Interior of the United States of America.
"Business Board" means the committee formed pursuant to Section 2.2 below.
"Capital Lease Obligation" means, at the time any determination thereof is to be
made, the amount of the liability in respect of a capital lease that would at such time be
required to be capitalized on a balance sheet prepared in accordance with GAAP.
"Casualty Event" means any casualty, event or occurrence that destroys or damages the
Gaming Facility.
"Class II Gaming" means Class II Gaming as that term is defined in IGRA.
"Class III Gaming" means Class III Gaming as that term is defined in IGRA.
"Compact" means the tribal-state Compact to be entered into between the Tribe and the
State of New York pursuant to the IGRA, as the same may be amended from time to time, or
such other Compact as may be substituted therefor.
"Comparative Month" has the meaning set forth in Section 9.1(f) below.
"Completion Date" means the date upon which the Authority receives, with respect to
each Phase of the Project: (i) a certificate from the Architect, as required pursuant to
the terms of the Architect's agreement with the Authority, certifying that the Project Phase
has been substantially completed in accordance with the Plans and Specifications therefor
and all applicable building, life/safety, environmental and other laws and regulations
applicable to the design and construction of the Project Phase; (ii) a certificate from the
Developer stating that it has completed all of its obligations hereunder; (iii) certificates
of such governmental authorities, professional designers, inspectors or consultants or
opinions of counsel as the Authority reasonably may determine to be appropriate verifying
completion of the Project Phase in compliance with all Legal Requirements; and (iv) the
Project Phase is fully stocked, staffed (including, without limitation, compliance with
Section 8.6 below) and ready to open to the public for business.
"Completion Guarantee" has the meaning set forth in Section 6.3 below.
"Concept Design" has the meaning set forth in Section 4.4 below.
"Contract Documents" has the meaning set forth in Section 5.4 below.
"Contractors" has the meaning set forth in Section 5.1 below.
"Construction Financing" means the financing to be obtained by, and/or committed to,
the Authority sufficient, as reasonably determined by the Authority, for the purposes of
acquiring the Property, and the design, construction, equipping and staffing of the Project.
"Construction Manager" means the professional employed pursuant to Section 5.1 below.
"Design Architect" shall mean the Designer selected by the Developer and the
Authority to design the Project.
"Design Consultants" shall mean the Architect and the Engineer and the other
consultants selected by the Developer and the Authority to design the Project.
"Design Development Documents" has the meaning set forth in Section 4.6 below.
"Developer" has the meaning set forth in the introductory paragraph hereof.
"Developer Fee" has the meaning set forth in Section 9.1 below.
"Developer's Financial Assistance" has the meaning set forth in Section 6.4 below.
"Director of Regulation" means the director of gaming operations appointed by the
Authority pursuant to the Tribe's Gaming Ordinance.
"Effective Date" means the later of (a) the date the Authority receives all Required
Approvals with respect to this Agreement, or (b) closing of the financing under the
Financing Agreements.
"Engineers" means professionals selected by the Developer and Authority to provide
services related to the engineering of the Project.
"Exhibits" means the exhibits attached to this Agreement.
"Facility" or "Facilities" means the Gaming Facility and the Ancillary Facilities, as
such may be modified, expanded, replaced, or reconstructed following a casualty loss in
whole or in part.
"Financing Agreements" has the meaning set forth in Section 6.1 below.
"Fiscal Year" means any fiscal year of the Authority.
"Fiscal Quarter" means any fiscal quarter of the Authority.
"Fiscal Month" means any fiscal month of the Authority.
"Force Majeure Causes" means causes beyond the reasonable control of a party to this
Agreement, including casualties, war, insurrection, strikes, lockouts and governmental
actions, excluding governmental actions of the Tribe or any instrumentality of the Tribe,
including the Authority, and causes which can be controlled by the expenditure of money in
accordance with good business practices.
"GAAP" means 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 such other statements by such other entity as have been approved by a
significant segment of the accounting profession.
"Gaming" means any and all activities defined as Class II Gaming and Class III Gaming
under the IGRA or authorized under the Compact or any other agreement entered into by the
Tribe or the Authority with the State of New York.
"Gaming Disputes Court" has the meaning set forth in Section 7.3 below.
"Gaming Facility" has the meaning set forth in Recital B hereof.
"Gross Gaming Revenue" shall mean the net win from Gaming which is the difference
between Gaming wins and losses before deducting promotional allowances, costs and expenses,
determined in accordance with GAAP consistently applied.
"Guarantee" means a guaranty, direct or indirect, in any manner, of all or any part
of any indebtedness or obligations of another Person.
"Hedging Obligations" means, with respect to any Person, the obligations of such
Person under (a) interest rate swap agreements, interest rate cap agreements and interest
rate collar agreements and (b) other agreements or arrangements designed to protect such
Person against fluctuations in interest rates.
"Indian Gaming Regulatory Act" or "IGRA" means the Indian Gaming Regulatory Act of
1988, 25 U.S.C. 2701, et seq., as amended from time to time.
------
"Indebtedness" means, with respect to any Person, any indebtedness of such Person,
whether or not contingent, in respect of borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement agreements in
respect thereof) or banker's acceptances or representing Capital Lease Obligations or the
balance deferred and unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes accrued expenses or trade
payables, if and to the extent any of the foregoing (other than letters of credit and
Hedging Obligations) would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP consistently applied.
"Independent Financial Advisor" means an accounting, appraisal or investment banking
firm of nationally recognized standing that is, in the reasonable judgment of the
Authority, (i) qualified to perform the task for which it has been engaged and (ii)
disinterested and independent with respect to the Authority and each Affiliate of the
Authority.
"Junior Financing" has the meaning set forth in Section 6.3 below.
"Key Personnel" means collectively the general manager of the Facility and the
managers of each major element of the Facilities (or the equivalent of the foregoing
positions).
"Land Claim" has the meaning set forth in Recital A hereof.
"Legal Requirements" means singularly and collectively all applicable laws,
including, without limitation, the Tribe's Gaming Ordinance, all other laws or regulations
of the Tribe, the IGRA, the Compact and applicable federal and New York statutes, laws and
regulations, and local ordinances, codes and rules.
"Master Plan" has the meaning set forth in Section 3.2.
"Memorandum of Understanding" has the meaning set forth in Recital E hereof.
"Minimum Priority Distribution" means payments to the Tribe from the operation of the
Facilities in the annual amount of Twenty Four Million ($24,000,000.00) Dollars.
"Monthly Financial Statement" has the meaning set forth in Section 9.1(b).
"National Indian Gaming Commission" or "NIGC" means the commission established
pursuant to 25 U.S.C.§.2704.
"Obligations" means any principal, interest, penalty, fees, indemnifications,
reimbursements and other liabilities or obligations payable under the documentation
governing any Indebtedness.
"Officer's Certificate" means a certificate signed on behalf of the Authority by two
officers of the Authority, one of whom must be the principal executive officer, the
principal financial officer, the treasurer or the principal accounting officer of the
Authority.
"Person" means any individual, sole proprietorship, corporation, general partnership,
limited partnership, limited liability company or partnership, joint venture, association,
joint stock company, unincorporated association, instrumentality or other form of entity.
"Phase" means a portion of the overall Project development as set forth in the Master
Plan.
"Plans and Specifications" means the detailed plans and specifications for the
construction of the Project prepared pursuant to Section 4.7 below.
"Principal Business" means the Class II and Class III Gaming Facility (as such terms
are defined in IGRA) and resort business and any activity or business incidental, directly
related or similar thereto, or any business or activity that is a reasonable extension,
development or expansion thereof or ancillary thereto, including any hotel, retail,
entertainment, recreation or other activity or business designated to promote, market,
support, develop, construct or enhance the gaming and resort business operated by the
Authority at the Property.
"Project" has the meaning set forth in Recital B hereof.
"Project Budget" means the budget approved by the Authority and the Developer that
includes the estimated Project Cost.
"Project Cost" means: all (1) costs of acquiring the Property and preparing the
Property for development of the Project, including costs and expenses for professional
services related thereto; (2) costs related to developing, designing, constructing,
equipping and furnishing the Project, including, costs related to professional services,
pre-opening costs, and initial operating capital; (3) start up and operating costs of the
Authority until the Completion Date; and (4) financing fees and expenses, interest payments
and any scheduled principal payments, prior to the Completion Date, allocated in accordance
with GAAP, consistently applied.
"Project Fund" has the meaning set forth in Section 6.1 below.
"Project Program" has the meaning set forth in Section 4.5 below, as modified in
accordance with the terms of this Agreement.
"Project Schedule" has the meaning set forth in Section 4.5 below.
"Promotional Allowances" means the retail value of hotel accommodations, food,
beverages, merchandise, chips, tokens and other services provided to customers for
promotional purposes without charge which retail value is included in the Revenues of the
Facility. For the purposes of this definition, "retail value" shall mean the usual and
customary charge for such service or item under the then existing circumstances.
"Property" has the meaning set forth in Recital B hereof, and any additions thereto.
"Proposed Financing" means the anticipated financing for the Project.
"Recitals" means the language set forth in Subparagraphs A through I of the first two
pages of this Agreement, which Recitals are incorporated herein and made a part hereof.
"Recommencement Month" means, following a Tolling Event, the earlier of the month in
which (i) the monthly Revenues of the Gaming Facility equal or exceed ninety percent (90%)
of the Average Gaming Facility Revenues, (ii) the date upon which the Authority has fully
complied with the requirements set forth in Section 10.6 below occurs, or (iii) the
Developer delivers written notice (which shall be irrevocable with respect to such Tolling
Event) to the Authority stating that the current month shall be deemed the "Recommencement
Month".
"Required Approvals" means (1) execution and approval of the Compact and related
agreements with the State of New York; (2) execution and approval of all applicable local
government agreements; (3) approval by the BIA and the final governmental authority of the
fee to trust application; (4) approval of this Agreement by the BIA, and/or the NIGC, to the
extent those agencies determine such approval may be required by law; (5) the entry of a
stipulated declaratory judgment by the Tribal Court upholding the validity and
enforceability of this Agreement and the Financing Agreements; (6) approval of a land
settlement agreement by the Federal Courts and the U.S. Congress (if applicable); (7)
approval of the Senior Financing and the Junior Financing documents, the Completion
Guarantee, the Financing Agreements and any related agreements by the Authority and any
other instrumentality of the Tribe having final approval authority.
"Revenues" means all revenues of any nature derived directly or indirectly from the
Project, including, without limitations, Gross Gaming Revenue, hotel revenues, room service,
catering, food and beverage sales, parking revenues, ticket revenues or other fees or
receipts from the convention/events center, other rental or other receipts from lessees,
sublessees, licensees and concessionaires (but not the gross receipts of such lessees,
sublessees, licensees or concessionaires) but excluding (i) any gratuities or service
charges added to a customer's xxxx, (ii) any credits or refunds made to customers, guests or
patrons, (iii) Promotional Allowances up to, but not to exceed, eight percent (8%) of
Revenues, (iv) any sales, excise, gross receipt, admission, entertainment, tourist or other
taxes or charges (or assessments equivalent thereto, or payments made in lieu thereof) which
are received from patrons and passed on to governmental or quasi-governmental entities
unrelated to the Tribe, (v) any federal, state or local taxes or impositions that relate to
the operation of the Facilities (other than any payment or fee in lieu of taxes on Gross
Gaming Revenues or pursuant to any agreements entered into by the Authority and/or the Tribe
with such entity), which may be implemented from time to time, (vi) any fire and extended
coverage insurance proceeds other than for business interruption, (vii) any condemnation
awards other than for temporary condemnation, and (viii) any proceeds of financings or
refinancings, all as determined in accordance with GAAP, consistently applied. For the
purposes hereof, all Revenues, except Gross Gaming Revenues, shall be computed and accounted
for at the greater of actual Revenue received or the usual and customary charge for such
service or item under the then existing circumstances.
"Schematic Design Documents" has the meaning set forth in Section 4.5 below.
"Senior Financing" has the meaning set forth in Section 6.2 below.
"Senior Lenders" has the meaning set forth in Section 6.3 below.
"Staffing Plan" has the meaning set forth in Section 8.6 below.
"Term" has the meaning set forth in Section 9.2 below.
"Tolling Event" means following a Casualty Event, the failure of the monthly Revenues
of the Gaming Facility to equal at least fifty percent (50%) of the Average Gaming Facility
Revenues for three (3) consecutive Fiscal Months.
"Tolling Period" has the meaning set forth in Section 13.20 below.
"Tribe" means the Xxxxxxxxxxx-Xxxxxx Band of Mohican Indians of Wisconsin, a
federally recognized Indian tribe and its permitted successors and assigns.
"Tribal Court" means the Xxxxxxxxxxx-Xxxxxx Tribal Court established by an ordinance
of the Xxxxxxxxxxx-Xxxxxx Tribal Council and approved by the BIA as more fully set forth in
Chapter One, Xxxxxxxxxxx-Xxxxxx Tribal Law, Tribal Court Code.
"Tribe's Preference Ordinance" means the Tribe's ordinance concerning preference in
hiring, "Tribal Laws, Chapter 54," and any replacements thereof or amendments thereto
adopted from time to time, and all related or implementing ordinances and policies of the
Authority to give preference in recruiting and hiring of employees.
"Tribe's Gaming Ordinance" means the Xxxxxxxxxxx-Xxxxxx Tribal Gaming Ordinance
enacted pursuant to Section 7.4 of this Agreement, and any replacements or amendments
thereto adopted from time to time, and all related or implementing ordinances, which are
enacted by the Tribe to authorize and regulate gaming on the Property in accordance with
IGRA and/or the Compact.
"Quarterly Financial Statement" has the meaning set forth in Section 9.1(c) below.
"Year-End Financial Statement" has the meaning set forth in Section 9.1(d) below.
ARTICLE 2
RETENTION OF DEVELOPER; CREATION OF THE BUSINESS BOARD
AND NON-COMPETE
2.1 Retention of Developer. The Authority hereby retains the Developer, as its
----------------------
exclusive developer for the Project, to perform all required development services relating to
the programming (including concept development), design, construction, equipping and staffing
(pursuant to Section 8.6 below) of the Project upon, and subject to, the terms and conditions,
and in consideration of the payments, hereinafter set forth. The Developer shall provide the
services as hereinafter set forth as necessary to facilitate the development of the Project and
shall furnish, at its cost, a sufficient number of trained personnel, with experience on
projects of a scope and magnitude similar to the Project, including a senior executive with
sufficient development, construction and project management experience in the gaming and resort
industry to be in charge of coordinating the development, design and construction of the
Project (the "Project Executive").
2.2 Creation of Business Board. Upon execution of this Agreement the Developer
---------------------------
and the Authority shall create the Business Board. The Business Board shall remain active
during the Term of this Agreement and shall consist of an equal number of representatives
from each of the Authority and the Developer, not to exceed six members in total. The
Business Board shall have authority to act for the Developer and the Authority with respect
to routine matters related to this Agreement and the development of the Project (provided no
dispute exists between members of the Business Board related to such routine matters),
subject to the terms and conditions set forth in this Agreement and any approvals of the
Authority, the Tribe (as applicable) or the Developer with respect to matters the Business
Board deems appropriate to bring to the attention of such persons for approval or which are
required to be brought to the attention of any such persons pursuant to this Agreement.
2.3 Non-Compete. During the Term of this Agreement, the Tribe, the Authority and
-----------
the Developer agree that no party (nor Affiliate of any party) shall own, operate, develop
or manage a Gaming Facility in the State of New York other than the Project unless each of
the parties consents in writing.
ARTICLE 3
ACQUISITION OF THE PROPERTY
3.1 Selection and Acquisition of the Property. The Developer shall research and
-------------------------------------------
review various options for the acquisition of the Property in the State of New York. The
Developer shall bring to the Tribe's and the Authority's attention property available for
purchase, together with available information related to such property, including the
property's size, location, availability, cost, environmental conditions, zoning, and
development potential, and the parties shall mutually agree upon the best available
development site for the Project. Nothing in this Agreement shall be construed so as to
require the Developer to contribute, acquire or expend funds on behalf of the Tribe and/or
the Authority for Property acquisition prior to the Effective Date.
3.2 Development of Master Plan for the Project. After selection of the Property,
-------------------------------------------
the Developer, with the assistance of the Business Board, shall develop for the Authority's
review and approval a master plan (the "Master Plan") for development of the Project in one
or more phases (the "Phases") on the Property selected. The Master Plan shall include the
size and location of the Facilities, proposed schedule for construction of the various
Phases of the Project (if applicable), and related information. The Master Plan approved by
the Authority shall serve as the blueprint for the Project's construction and financing,
subject to additions, deletions and alterations as may be made to the Master Plan from time
to time upon mutual agreement of the parties.
ARTICLE 4
DESIGN OF THE PROJECT
4.1 General Supervision. The Authority shall at all times have final authority to
--------------------
approve or disapprove all contracts and other matters related to the design, development and
construction of the Project consistent with the terms of this Agreement. The Developer
shall represent the Authority and act as the Authority's liaison with respect to the
selection, direction and management of the Architect selected pursuant to Section 4.2 and
the Contractors and/or the Construction Manager selected pursuant to Section 5.1, and any
other professionals engaged, in accordance with the terms of the Project Program, to perform
services in connection with the design and construction of any portion of the Project.
Subject to the limitations described herein, the Authority shall delegate and assign to the
Developer its rights under any construction management, architectural, engineering and other
agreements with development professionals to allow the Developer to supervise, direct and
administer the duties, activities and functions of the Architect, the Construction Manager,
the Design Consultants and other development professionals. The Architect and the
Contractors and/or the Construction Manager shall review and advise the Authority and the
Developer with respect to the Project Program.
4.2 Engagement of Architect. The Developer, with the approval of the Business
--------------------------
Board, shall select and the Authority shall engage an Architect(s) and/or Engineers
familiar with the design of gaming facilities and for the purpose of performing certain
services in connection with the construction of the Project, including site development. All
agreements with the Architect(s) and/or Engineers shall be in a form of contract prepared
and recommended by the Developer and approved by the Business Board for execution by the
Authority. The Authority shall compensate the Architect(s) and/or Engineers for services
rendered out of its proceeds from the Financing Agreements obtained in connection with the
Project, after approval of any payment by the Developer. The Authority shall designate the
Developer as its representative under any Architectural and/or Engineering Agreements in
order to allow the Developer to supervise, direct, control, and administer the duties and
activities and functions of the Architect(s) and/or Engineers.
4.3 Design and Construction Budget. The Developer, with the assistance and input
--------------------------------
of the Architect, shall establish the Budget for the design, construction and the furnishing
and equipping of the Project prior to the commencement of design of the Project by any
Architect. The Budget shall be reviewed by the Business Board and recommended to the
Authority to be approved in writing by the Authority within 15 days of receipt, or, absent
written notice of disapproval, they shall be deemed to have been approved.
The Developer may revise the Budget from time to time, as necessary, to reflect any
unpredicted significant changes, variables or events or to include significant, additional,
unanticipated items of expense. The Developer may, without the approval of the Authority,
reallocate part or all of the amount budgeted with respect to any line item to another line
item and to make such other modifications to the Budget as the Developer deems necessary
other than increases to the overall Budget amount or which require allocation of the Budget
contingency or which materially alter the Plans and Specifications which have been approved
by the Authority. In addition, the Developer may approve change orders provided Developer
gives the Authority prior written notice of any proposed change order together with a copy
of such order and a statement as to whether the change order will result in a budget
increase and the Authority does not disapprove such change order in writing within fifteen
(15) days of receipt of such notice.
Budget adjustments which otherwise vary from the terms of this Agreement shall, upon
the request of the Developer and evaluation of the Business Board, require the written
approval of the Authority. The Authority acknowledges that the Budget is intended only to be
a reasonable estimate of the Project's construction and development costs and expenses. The
Developer shall not be deemed to have made any guarantee, warranty or representation
whatsoever in connection with the Budget.
4.4 Concept Design and Engineering. The Authority, based upon the
-------------------------------------
recommendations of the Developer and the Business Board shall designate its requirements for
the Project, including, but not limited to, a program which shall set forth the Developer's
and the Authority's objectives, schedule requirements, design criteria, including
assumptions regarding HVAC demands, space requirements and relationships, special equipment
and site requirements (the "Concept Design"). The Architect shall review the Concept Design
for the Project.
4.5 Preliminary Program Evaluation. The Developer shall cause to be prepared for
-----------------------------------
the approval of the Authority, a preliminary evaluation of the proposed Project's program
schedule (the "Project Schedule"), budget requirements and alternative approaches to design
and construction of the Project (the "Project Program"). Based upon the agreed upon Program
Schedule, budget requirements and design, the Architect shall prepare schematic design
documents consisting of drawings and other documents illustrating the scale and relationship
of the proposed Project and its components (the "Schematic Design Documents"), as well as a
preliminary estimate of construction costs based upon the proposed area, size and scope of
the Project.
4.6 Design Development. Upon final approval of the Schematic Design Drawings for
--------------------
the Project by the Authority, the Architect shall prepare for the Developer and the
Authority design development documents consisting of drawings and other documents to fix
and describe the size and character of the Project as to architectural, structural,
mechanical and electrical systems, materials and such other elements as may be appropriate
(the "Design Development Documents"). Further, the Architect shall advise the Developer and
update any preliminary estimate of construction costs and any budgets for furnishing
equipment to the Project. The Developer shall submit to the Business Board for review and
recommendation and to the Authority, for its review and approval, finalized versions of the
Design Development Documents prepared by the Architect and agreed to by the Developer.
4.7 Construction. Based upon the approved Design Development Documents and any
---------------
further adjustments in the scope and quality of the Project, or in the Budget approved by
the Authority, the Architect shall prepare for review by the Developer and the Business
Board and approval by the Authority, construction documents consisting of preliminary
drawings and specifications setting forth the general requirements for construction of the
Gaming Facility. It is likely that construction will commence before final detailed plans
and specifications ("Plans and Specifications") have been completed. The Architect shall
proceed with completion of the Plans and Specifications as they relate to the construction
of portions of the Project in the order such portions are to be completed or in the order
required for sequential completion, and shall proceed with completion of all Plans and
Specifications as soon as reasonably possible given construction scheduling and progress of
the work. The Architect shall advise the Developer and the Business Board of any
adjustments to previous estimates of construction cost, schedules, and/or budgets.
4.8 Plans and Specifications. As portions of the detailed Plans and
-----------------------------
Specifications are completed for segments of the construction of the Project, the Architect
shall be required to submit duplicate copies of those portions of the Plans and
Specifications to the Developer, Business Board and the Authority periodically for their
prompt review and approval.
4.9 Compliance with Construction Standards, Environmental Laws and Regulations.
-------------------------------------------------------------------------------
The Project shall be designed and constructed so as to adequately protect the environment
and the public health and safety. The design, construction and maintenance of the Project
shall, except to the extent a particular requirement or requirements may be waived in
writing by the Authority, meet or exceed all reasonable minimum standards pertaining to
Tribal, state or local building codes, fire codes and safety and traffic requirements (but
excluding planning, zoning and land use laws, ordinances, regulations and requirements
unless applicable) which would be imposed on the Project by applicable New York or Federal
statutes or regulations or local ordinances or codes which would be applicable if the
Project were located outside of the jurisdictional boundaries of the Tribe, even though
those requirements may not apply within the Tribe's jurisdictional boundaries. In addition,
those mitigation steps specified in the environmental assessment and the National
Environmental Policy Act ("NEPA") documents shall be taken. To the extent that the Tribe may
adopt more stringent requirements, those requirements shall govern. The Architect's contract
shall provide that the Architect shall certify to the Authority compliance with the NEPA and
all other applicable environmental and cultural resource laws and regulations. The Authority
shall be responsible for and shall certify to appropriate governmental agencies compliance
with the NEPA and all other applicable environmental and cultural resource laws and
regulations. Nothing in this Section 4.9 shall grant to the State of New York or any
political subdivision thereof any jurisdiction (including but not limited to jurisdiction
regarding zoning or land use) over the Property or the development and management of the
Project.
ARTICLE 5
CONSTRUCTION OF THE PROJECT
5.1 Selection of Contractors. The Developer shall, in consultation with the
---------------------------
Business Board, initiate a selection process in order to prequalify prospective contractors
(the "Contractors") and/or a Construction Manager (the "Construction Manager") in connection
with the construction of the Project. The Developer shall submit the list of prequalified
contractors and/or construction managers to the Business Board for its review and comment.
5.2 Proposal Review and Bid Process. Subsequent to the pre-qualification of
-----------------------------------
prospective contractors and/or construction managers, the Developer shall conduct a review
of proposals for the construction of the Project, and the Developer shall negotiate and the
Authority shall award a construction contract or contracts to the most well-qualified
Contractor or Contractors and/or Construction Manager. The Developer shall attempt to
secure at least three competitive bids for each contract (subject to the availability of
contractors willing to bid on such contract), analyze and compare the bids and present its
review and recommendations to the Authority and/or Business Board (as applicable) for
approval. The successful Contractors and/or Construction Manager shall be properly licensed
in the State of New York and shall be capable of furnishing a payment and performance bond
satisfactory to the Business Board to cover the construction for which the Contractor or
Construction Manager was retained.
5.3 Contracts; Developer Prohibition. The Business Board shall select the
------------------------------------
successful Contractors and/or Construction Manager and the Authority shall enter into a
construction management agreement and related contracts, or a general contract for the
construction of the Project and in compliance with the Tribe's Preference Ordinance. The
Developer shall prepare, for review and approval by the Authority, all required contract
documents and agreements necessary for construction of the Project. The Authority shall
compensate any Contractors and Construction Manager selected by the Developer for
construction of the Project from its proceeds from the Financing Agreements and, if
applicable, other construction financing obtained in connection with the Project. The
Developer, its members and their respective Affiliates shall not bid on any aspect of the
Project or be awarded any contracts without the express written consent of the Authority
(and subject to the disclosure requirements of Section 8.3 of this Agreement).
5.4 Contract Documents. The contract documents ("Contract Documents") shall
--------------------
require the successful Construction Manager or general contractor and all Contractors to be
responsible for providing all materials, equipment and labor necessary to construct and
equip the Project as necessary, including site development. The scope of the Contract
Documents shall require the Contractors and/or the Construction Manager to construct the
Project in accordance with the Plans and Specifications prepared by the Architect, including
any changes or modifications thereto approved by the Business Board and the Developer. The
Contract Documents shall provide for adequate insurance, appropriate lien waivers, and
construction schedules by which milestones, progress payments and late penalties may be
calculated.
5.5 Construction Administration. The Authority hereby assigns to the Developer,
-----------------------------
prior to the commencement of construction, and the Developer shall be responsible for, all
construction contract and construction management administration during the construction
phase of the Project. The Developer shall act as the Authority's designated representative
and shall have full power and complete authority to act on behalf of the Authority in
accordance with the terms of this Agreement in connection with any construction contracts
and/or construction management agreements. The Developer shall have control and charge of
any persons performing work on the site of the Project. The Developer shall interpret and
decide on matters concerning the performance of any contractor, and/or construction manager
and the requirements of the Contract Documents. The Developer shall have the authority to
reject work which does not conform to the Contract Documents. The Developer shall conduct
inspections to determine the date or dates of substantial completion and the date of final
completion of each Phase of the Project. The Developer shall observe and evaluate or
authorize the evaluation of work performed, the review of applications for payment for
submission to the Authority and the review and certification of the amounts due the
Contractors and/or Construction Manager.
5.6 Progress Payments. The Authority shall make progress payments for
--------------------
construction performed by the Contractors on a periodic basis as directed and approved by
the Business Board and the Developer. Progress payments for construction shall be funded by
the Authority from Construction Financing proceeds. The Authority shall not be required to
make progress payments unless the Contractors certify that the work has been performed in
accordance with the Plans and Specifications and that the Contractor has satisfied all
other conditions for payment set forth in the applicable Contract Documents.
5.7 Selection of Furniture, Trade-Fixtures and Equipment. The Business Board
---------------------------------------------------------
shall select and recommend to the Authority vendors for purchase by the Authority, of
furniture, trade fixtures and equipment required to operate the Facilities at the Project.
Alternatively, the Developer may arrange for the procurement of furniture, trade fixtures
and equipment on lease terms as may be approved by the Business Board. The Developer
agrees to employ good business practices and competitive bidding.
ARTICLE 6
FUNDING REQUIREMENTS OF THE PROJECT
6.1 Authority's Funding Obligations. Subject to the terms of this Agreement, the
---------------------------------
Developer agrees to use its best efforts to assist the Authority in the arrangement of the
financing for the design, construction, equipping, start-up and working capital for the
Project, including the Senior Financing and the Junior Financing as set forth below
(collectively, the "Financing Agreements"). The Financing Agreements shall contain provisions
consistent with Section 12.4 of this Agreement limiting the recourse of lenders to certain
assets of the Authority. The Authority shall, after the closing of the Senior Financing and
prior to commencement of construction of the Project, make available or otherwise cause to be
established a development fund pursuant to the Financing Agreements into which will be
deposited all of the proceeds of the financing (the "Project Fund"). The Project Fund shall be
designated exclusively for performing the Authority's obligations under this Agreement, and for
costs for any design and construction agreements entered into, as well as any agreements for
the lease or purchase of furniture, trade fixtures and equipment for the construction of the
Project and for start-up costs and expenses of the Facilities, all in accordance with this
Agreement and the Financing Agreements. The Project Fund shall be used to discharge the
Authority's obligations under this Agreement, any and all design, construction or related
agreements entered into for the development of the Project, including but not limited to,
reimbursement to the Developer of the Developer's Financial Assistance provided to the Tribe
and/or the Authority in accordance with Section 6.4 (a) below, acquisition of the Property,
consulting and other professional fees, supplies, utility costs, total cost of the development
and construction of the Project, landscaping, parking, curb cuts, access enhancement, off-site
road improvement, architectural, engineering, contractors fees and costs, furniture, signs,
trade fixtures and equipment necessary for implementing the operation of the Project, closing
and financing related costs, and interest as provided in the Financing Agreements.
Additionally, the initial working capital for the Facilities operations shall be provided from
the proceeds of the Financing Agreements. The Tribe and/or the Authority have no obligation to
fund any activities related to the Project, including without limitation, Project Costs, except
from the proceeds of Developer's Financial Assistance and/or the Financing Agreements.
6.2 The Senior Financing. The Developer agrees to assist the Authority with the
---------------------
Authority's efforts to obtain Bank and/or Bond Financing for the Project (the "Senior
Financing") in amounts consistent with the Project Budgets.
In connection with Senior Financing, the Developer will:
(i) Assist and advise in developing a strategy for the Senior Financing;
(ii)Identify possible financial sources;
(iii) Finalize a financing term sheet;
(iv)As applicable, assist in the preparation of a private placement
memorandum or information memorandum to be distributed to a short list of
financiers;
(v) As applicable, distribute the private placement memorandum or
information memorandum to a short list of financiers;
(vi)Assist and advise in making presentations with respect to the financing
to potential financiers;
(vii) Review and assist in evaluating commercial and financial
sections of various contracts and agreements and terms of financing with
financiers;
(viii) Advise and assist in selecting the final terms and conditions with
financiers and in completing appropriate definitive financing
documentation; and provide such other non-financial assistance as the
parties deem appropriate.
In connection with the Senior Financing, the Tribe and the Authority will
cooperate with the Developer's efforts. Such cooperation shall include: (a) direct contact
between the Tribe and the Authority's senior officials, management and advisors and
prospective lenders, (b) cooperation in the preparation of an information memorandum or
private placement memorandum and other marketing materials, and (c) the hosting, with the
Developer, of one or more meetings with prospective lenders. In addition, it is understood
and agreed that, upon advice and recommendation of the Developer and with the approval of
the Authority, or at the Authority's discretion, the Authority may retain (at the
Authority's cost and expense) the services of an investment banker and such other
professional advisors as may be necessary for the placement of the Senior Financing.
6.3 The Junior Financing and/or Completion Guarantee. In addition
------------------------------------------------
to the Senior Financing, if required by lenders of the Senior Financing (the "Senior
Lenders") in order to secure the Senior Financing, on the Effective Date, the Developer will
provide or will cause an Affiliate or Affiliates of the Developer to provide up to One
Hundred Million ($100,000,000.00) Dollars of subordinated debt financing (the "Junior
Financing") and/or a completion guarantee (the "Completion Guarantee") on the Project
subject to terms and conditions acceptable to the Developer. The Junior Financing shall
bear an interest rate of Twelve Percent (12%) per annum with interest payments only payable
monthly in arrears, for a period of five (5) years, and repayment of the principal balance
at the end of the fifth year. The Completion Guarantee (if any) shall be in the form
negotiated by Developer with the Senior Lender and may be in the form, for example, of the
completion guarantee entered into by the Developer's Affiliate for Phase I of the Mohegan
Sun Casino development in Connecticut.
Except as set forth in this Section 6.3 and in Section 13.21, the Tribe, the
Authority and the Developer agree that this Agreement shall not be construed as implying,
any form of commitment by the Developer or any of its Affiliates to participate in or
provide any financing (other than the Junior Financing), guarantees (other than the
Completion Guarantee) or credit support or to underwrite or publicly distribute securities
on behalf of the Tribe or the Authority, or any assurance that any placement efforts will be
successful. Notwithstanding anything to the contrary herein, it is understood that the
Developer is not undertaking to provide any legal, accounting, or tax advice in connection
with its obligations hereunder, and the Tribe and the Authority shall rely solely upon its
own experts therefor.
6.4 Developer's Other Funding Obligation. (a) Financial Assistance. The
--------------------------------------- ---------------------
Developer will provide, in accordance with the terms and conditions of this Agreement and as
reasonably determined by the parties, financial assistance of up to Ten Million
($10,000,000.00) Dollars (the "Developer Financial Assistance") as is reasonably necessary
to assist the Authority and the Tribe with (i) locating, assessing, negotiating and
acquiring the Property, (ii) settlement of the Tribe's New York land claims, (iii) having
the Property taken into trust, (iv) negotiation of a Tribal/State Compact, (v) negotiation
of a local government agreement, (vii) obtaining federal, state and local approvals and
(viii) preliminary preparation of the Property for Project development. The Tribe and the
Authority acknowledge that the Developer has incurred and/or accrued expenses of
approximately $800,000 under this Section 6.4 through December 31, 2000. In addition, the
Developer will reimburse the Tribe for documented expenses incurred or accrued by the Tribe
through January 31, 2001 in the approximate amount of $125,000.The above amounts (together
with such other additional amounts agreed to by the parties and incurred prior to the
execution of this Agreement) shall be included in the total Developer Financial Assistance
expended under this Section 6.4. The Developer agrees to provide a portion of Developer's
Financial Assistance to the Tribe and/or the Authority to be utilized by them solely for the
purposes set forth in this Section 6.4 based upon an approved budget and accounting controls
to be negotiated and agreed to by the parties. The Developer Financial Assistance budget
and accounting procedures shall be administered by the Business Board or its appointed
representatives. Except as set forth in Section 6.4(b) below related to the acquisition of
the Property, the Developer's Financial Assistance shall be reimbursed out of the proceeds
of the Project financing in accordance with the terms and conditions set forth in the
Financing Agreements. The provisions of the previous sentence shall survive any termination
of this Agreement. Notwithstanding the above, in the event the Authority does not receive
Project financing or the Required Approvals, as contemplated herein, then the Developer's
Financial Assistance shall be nonreimbursable. In addition, the Developer may suspend its
obligations under this Section 6.4 in the event the Tribe fails to materially perform its
obligations set forth in Article 7 of this Agreement.
(b) The Property. As part of the Developer's Financial Assistance to the
------------
Authority and the Tribe set forth in Section 6.4 (a) above, the Developer on the Effective
Date (or such earlier time as the Developer, in its sole discretion, deems appropriate) will
contribute the Property at Developer's actual cost and/or funds necessary to acquire the
Property in an amount not to exceed Three Million ($3,000,000.00) Dollars. The amount
contributed by the Developer toward the purchase price of the Property will not be
reimbursable to the Developer from the proceeds of the financing or otherwise.
ARTICLE 7
OBLIGATIONS OF THE TRIBE
7.1 Land Claim and Project Development. As a condition to the Developer's
--------------------------------------
performance of its obligations hereunder, the Tribe agrees, upon execution of this
Agreement, to utilize its best efforts, upon terms and conditions acceptable to the Tribe,
to: (a) settle its Land Claims with the State of New York and obtain, as part of that
settlement, a Compact containing the right to develop and operate the Facilities on the
Property, (b) make application to the United States Department of the Interior for the
Property to be taken into trust by the United States for the purposes of permitting the
Tribe to develop and operate the Facilities, (c) enter into an agreement with applicable
local governing bodies providing for appropriate incentives to permit development of the
Project and (d) such other agreements relating to the Project as may be in the Developer's
and the Tribe's best interests.
7.2 Establishment of the Authority. Within thirty (30) days of execution of this
--------------------------------
Agreement, the Tribe shall, in accordance with the Tribe's Constitution and laws, establish
the Authority (or such similar instrumentality), which Authority shall remain in existence
during the Term of this Agreement. Prior to the establishment of the Authority, or upon
abolishment of the Authority without a successor, the Tribe shall have all of the rights and
obligations set forth in this Agreement pertaining to the Authority. Upon its
establishment, the Authority shall execute and become a party to this Agreement.
7.3 Gaming Disputes Court. Prior to the Effective Date (and in such time so as to
----------------------
effectuate the Required Approvals), the Tribe shall, in accordance with the Tribe's
Constitution and laws, establish a Gaming Disputes Court with jurisdiction to hear disputes
related to Gaming at the Facility as well as other disputes related to the operation of the
Facility by the Authority and to Gaming generally. In addition, the Gaming Disputes Court
shall have jurisdiction to enter orders prohibiting the impairment of contracts and
requiring due notice of any proposed changes of any such contracts including, but not
limited to, this Agreement and the Financing Agreements. The Gaming Disputes Court shall
remain in existence during the Term of this Agreement.
7.4 Tribal Gaming Ordinance. Prior to the Effective Date and continuing during
------------------------
the Term hereof, the Tribe shall adopt and maintain a Tribal Gaming Ordinance to enable the
Tribe and the Authority to fulfill its obligations under this Agreement, the Compact and any
other applicable law as required by the IGRA, which Ordinance shall be approved by the
NIGC. Nothing contained in such Tribal Gaming Ordinance, or actions taken pursuant thereto,
shall prejudice or have a material adverse effect upon Developer's rights set forth in this
Agreement; including but not limited to, the tribal gaming license requirements of said
ordinance applicable to the Developer. This provision is not intended to relieve Developer
of its obligations under Section 8.8.
7.5 Approval of this Agreement; Stipulated Declaratory Judgment. (a) The Tribe
---------------------------------------------------------------
shall adopt a resolution approving this Agreement and authorizing its execution by the
Tribal Council President.
(b) Upon execution of this Agreement by all the parties, the Tribe and the
Authority shall file a Complaint with the Tribal Court seeking the entry of a stipulated
declaratory judgment upholding the validity and enforceability of this Agreement, the form
of which will be mutually agreed to by the Tribe, the Authority and the Developer. The
Tribe represents and warrants that the Tribal Court has full authority under the Tribe's
Constitution and laws to enter an order upholding the validity and enforceability of this
Agreement and the Financing Agreements, and to enter orders prohibiting the impairment of
contracts and requiring due notice of any proposed changes of any such contracts including,
but not limited to, this Agreement and the Financing Agreements.
ARTICLE 8
ADDITIONAL DUTIES AND OBLIGATIONS OF THE
AUTHORITY AND THE DEVELOPER
8.1 Employment of Other Professionals. The Authority, in consultation with the
----------------------------------
Developer, shall select and employ other professionals, including, without limitation,
surveyors, attorneys, accountants and public relations or advertising firms, to perform
services required for the Project.
8.2 Progress Reports and Meetings. The Business Board shall have monthly meetings
------------------------------
(and other meetings as may be needed) to discuss the progress of the Project, including,
without limitation, updates to the Project Schedule and Budget, any claims or disputes, the
status of the work, the administration of the Developer's Financial Assistance budget and
accounting procedures and all other relevant items. The Developer shall submit to the
Authority monthly progress reports showing the then present status of design and/or
construction of the Project and shall meet with the Authority on a regular basis to review
the status of the Project.
8.3 Submission of Contracts. The Developer agrees promptly to submit to the
-------------------------
Authority copies of all contracts and subcontracts relating to the Project from time to time
received by the Developer and all other documents related to the Project. The Developer,
with the assistance of the general contractor and/or the Construction Manager, shall assist
the Authority in complying with the terms of, and maintain in full force, all contracts for
design or construction of the Project and any surety bonds issued in connection
therewith. The Developer shall give the Authority immediate notice of: (i) any fault or
defect relating to construction of any Facility; (ii) any known failure of any party to
comply with the terms of any contract or bond relating to any Facility, and shall submit to
the Authority copies of any correspondence regarding an alleged claim, fault, defect or
default by any Person in relation to any contract or agreement relating to any Facility,
together with an explanation thereof and proposed corrective steps of nonconformance with
the Plans and Specifications. All Contractors that are members or Affiliates of the
Developer must disclose said affiliation prior to its execution of any contract related to
the Project.
8.4 Permits and Licenses. Except for permitting and licensing requirements of the
--------------------
Tribe, the Developer shall advise the Authority as to all permitting and licensing
requirements for the Project, and the Authority, in consultation with the Developer, shall
obtain or cause to be obtained all permits and licenses required for the design,
construction, equipping and opening of the Project.
8.5 Maintenance of Records. The Developer, the general contractor and/or the
------------------------
Construction Manager and the Architect, shall maintain on the Property (or at the
Developer's offices in Waterford, Connecticut) all books and records in connection with the
design, construction, equipping and opening of the Project, together with all documents and
papers pertaining to the Project, including, without limitation, general maintenance of such
full and detailed accounts as may be necessary for proper financial management of the
Project. All such documents shall at all times be open to the inspection of the Authority.
Copies of such documents shall be provided to the Authority or the Authority's
representative, and the Developer shall cooperate with any audit of such books and records.
After the expiration or termination of this Agreement, the Developer shall deliver all such
books and records together with all such related documents and papers to the Authority, and
the Developer shall be entitled to retain a copy.
8.6 Staffing of Project. (a) The Developer shall have the responsibility to
---------------------
provide direction to the Authority concerning the Authority's selection, retention and
training of all initial employees performing regular services in connection with the
management, operation and maintenance of the Project on the Completion Date. No later than
sixty (60) days prior to the anticipated Completion Date of the Project (or any portion
thereof that will be opened for business), the Developer shall submit to the Authority, for
its approval, a detailed staffing plan for all personnel necessary to operate the Project
(or portion thereof) in a first class manner, which staffing plan shall include, without
limitation, organizational charts, a job classification system with job descriptions, salary
levels and wage scales (the "Staffing Plan"). The Staffing Plan shall be subject to the
Authority's review and approval (which approval may be withheld in its sole and absolute
discretion) and to compliance with the Tribe's Preference Ordinance.
(b) All prospective employees shall be subject to the Authority's approval, which
approval may be withheld in the Authority's sole and absolute discretion. All Key Personnel
and any and all other employees as required by the Director of Regulation of the Authority
shall be subject to background checks to be performed by the Authority (and the Authority
shall have the right to reject any candidate for any position based on the results
thereof). In order to maximize the benefits of the Project to the Tribe and the Authority,
the Developer shall act in compliance with the Tribe's Preference Ordinance in recruiting,
training and recommending candidates for employment to the Authority, to the extent such
preference is consistent with applicable law in all job categories of the Project,
including, without limitation, management positions. The Developer shall supervise all
activities determined necessary by the Authority to recruit and train Tribal members, and
other qualified persons who meet the tribal preference, including, without limitation,
providing job fairs for members of the Tribe and clearly specifying the tribal preference in
all job advertisements.
(c) Notwithstanding anything contained herein to the contrary, from and after the
Completion Date of the Project (or any portion thereof which is sooner opened for business),
all decisions with respect to the management, operation and maintenance of the Project (or
portion thereof) shall be made exclusively by the Authority.
8.8 Suitability/Licensing Requirements. Subject to the provisions of this Section
------------------------------------
8.8 and Section 7.4 of this Agreement, the Developer and any successors or assigns of the
Developer shall: (i) be subject to the regulatory power of the Authority as set forth in
the Tribal Gaming Ordinance, (ii) demonstrate its suitability for a gaming license from the
Authority and (iii) maintain that suitability throughout the term of this Agreement. At the
time of execution of this Agreement, Developer has demonstrated to the satisfaction of the
Tribe and the Authority that Developer's affiliates, including Trading Cove Associates, and
their respective principals hold Gaming Services Registrations issued by the Division of
Special Revenue for the State of Connecticut (the "Gaming Registrations"), and that SINA and
certain of its affiliates, and their respective principals have been qualified for licensure
in conjunction with casino gaming licenses issued by the State of New Jersey and/or the
Commonwealth of The Bahamas (the "Gaming Licenses"). Since the principals of Developer and
Developer's affiliated entities have successfully completed background checks and have been
qualified for licensure as part of the process for granting the above Gaming Registrations
and Gaming Licenses, the Tribe and the Authority acknowledge and agree, at the time of
execution of this Agreement, that Developer is a suitable company with whom to engage in
gaming related activities under the Tribe's current gaming regulations applicable to the
Tribe's gaming operations in the State of Wisconsin, and is deemed eligible for a tribal
gaming license when the Tribal Gaming Ordinance licensing process is in place. The
licensing process set forth in the Tribal Gaming Ordinance shall not be stricter than the
certification requirements currently in effect under the Tribe's Wisconsin licensing
process. Continued suitability for a tribal gaming license under the Tribal Gaming
Ordinance during the term of this Agreement is a material condition of this Agreement.
ARTICLE 9
COMPENSATION TO THE DEVELOPER & TERM OF AGREEMENT
9.1 Developer Fee. As compensation to the Developer for the Developer's services
-------------
performed hereunder related to the Project, the Authority shall make certain payments to
the Developer ("the Developer Fee," as defined below in Section 9.1(a)), without set-off,
deduction or counter claim (except as may be required to satisfy an arbitration award in
favor of the Tribe and/or the Authority against the Developer entered pursuant to the
provisions of Section 12.2 of this Agreement). The Developer Fee shall be paid and consist
of those amounts computed in accordance with paragraph (a) as set forth below:
(a) Within fifteen (15) days following the end of the calendar month in which the
Gaming Facility opens and thereafter within fifteen (15) days following the end of each
successive calendar month during the Term hereof the Authority shall pay the Developer an
amount equal to five percent (5.0%) of Revenues from the Facilities received during the
preceding month (the "Developer Fee").
(b) Within fifteen (15) days following the end of each Fiscal Month during the
Term hereof, the Authority shall provide to the Developer operating financial statements
derived from the preceding Fiscal Month which include, without limitation, all Revenues
generated by the Facilities and the amount of the Developer Fee paid or payable to the
Developer pursuant to Section 9.1(a) (the "Monthly Financial Statements"). Such statements
shall be prepared in accordance with GAAP, consistently applied, and shall be certified as
true and complete by the Authority. Upon reasonable notice and at reasonable times, the
Developer, or its duly authorized representatives, shall have on-site access to, and be
entitled to photocopy, the books and records of the Authority relating to the Facilities for
the purpose of verifying the Monthly Financial Statements. In addition, the Developer shall
have the right, at the Developer's expense, to audit these financial statements by
examination of all or any part of the books and records of the Authority or the Facility, as
the Developer, in its sole discretion, may require.
(c) Within forty-five (45) days following the end of each Fiscal Quarter during
the Term, the Authority shall provide to the Developer operating financial statements for
the preceding Fiscal Quarter which have been reviewed by nationally recognized independent
auditors selected by the Authority which include, without limitation, all Revenues generated
by the Facilities and the amount of the Developer Fee paid or payable to the Developer
pursuant to Section 9.1(a) (the "Quarterly Financial Statements"). Such statements shall be
prepared in accordance with GAAP, consistently applied, and shall be certified as true and
complete by the Authority. Upon reasonable notice and at reasonable times, the Developer,
or its duly authorized representatives, shall have on-site access to, and be entitled to
photocopy, the books and records of the Authority relating to the Facilities for the purpose
of verifying the Quarterly Financial Statements. In addition, the Developer shall have the
right, at the Developer's expense, to audit these financial statements by examination of all
or any part of the books and records of the Authority or the Facility, as the Developer, in
its sole discretion, may require.
(d) Within ninety (90) days following the end of each Fiscal Year (or portion
thereof) during the Term, the Authority shall provide to the Developer operating statements
derived from audited financials for the preceding Fiscal Year which include, without
limitation, all Revenues generated by the Facilities and the amount of the Developer Fee
paid or payable to the Developer pursuant to Sections 9. 1 (a) (the "Year End Financial
Statements"). Such statements shall be prepared in accordance with GAAP, consistently
applied, and shall be certified as true and complete by the Authority and by nationally
recognized independent auditors selected by the Authority. Upon reasonable notice and at
reasonable times, the Developer, or its duly authorized representatives, shall have on-site
access to, and be entitled to photocopy, the books and records of the Authority relating to
the Facilities for the purpose of verifying the Year End Financial Statements. In
addition, the Developer shall have the right, at the Developer's expense, to audit the
financial statements by examination of all or any part of the books and records of the
Authority or the Facility, as the Developer, in its sole discretion, may require.
(e) To the extent that the Developer Fee (or portion thereof) is not paid when
due, such amounts shall earn interest at a rate of twelve percent (12%) per annum from the
due date thereof until the date payment is made (or if such rate of interest is not lawful,
at the maximum lawful rate of interest). This Section 9.1(e) shall not apply to any
payment of the Developer Fee which has been delayed on account of the payment of any
Minimum Priority Distribution under Section 10.1 of this Agreement.
(f) In the event that (i) a Casualty Event shall have occurred, (ii) the Developer
has not elected to declare a Tolling Event pursuant to Section 13.20 hereof, and (iii)
Revenues for any month in which a Casualty Event continues are less than the Gaming
Facility Revenues for the same month of the preceding year (the "Comparative Month"), then
all proceeds from business interruption insurance shall be paid to Developer by the
Authority until the entire amount of the Developer Fee (based on the Comparative Month) due
each month during the period of the Casualty Event is paid.
(g) The Authority shall provide to the Developer annual capital and operating
budgets for the Project and any revisions thereto. Such budgets shall be provided to the
Developer within five (5) days of the Authority's approval of same, but in no event later
than December 1st of the preceding year.
9.2 Term. The term of this Agreement shall commence on the date first above
----
written, and shall continue for a period of twenty (20) years after the opening of the
Gaming Facility to the general public (the "Term"); provided, however, that this Agreement
shall remain in full force and effect until all Developer Fees have been paid in accordance
with this Article 9.
ARTICLE 10
CERTAIN COVENANTS OF THE AUTHORITY
10.1 Payments to the Tribe. (a) Other than the Minimum Priority Distribution set
---------------------
forth in Section 10.1(b) below, the Authority shall not make any payment or distribution to
or for the benefit of the Tribe, any Affiliate of the Tribe, or make any distribution to
members of the Tribe (i) prior to the payment in full of the Developer Fees then due, or
(ii) at anytime if any Developer Fees are outstanding.
(b) Minimum Priority Distribution. Within fifteen (15) days following the end
-------------------------------
of the calendar month in which the Gaming Facility opens and thereafter within fifteen (15)
days following the end of each successive month during the Term hereof, the Authority shall
pay to the Tribe one twelfth (1/12) of the Minimum Priority Distribution from the Revenues
of the Facilities, to the extent available. Any underpayment of the Minimum Priority
Distribution in any calendar month shall be added to the Minimum Priority Distribution due
the following calendar month. The Developer Fee shall be subordinate in all respects to the
payment of the Minimum Priority Distribution.
10.2 Affiliate Transactions. The Authority shall not sell, lease, transfer or
-----------------------
otherwise dispose of any of its properties or assets to, or purchase any property or assets
from, or enter into or make any contract, agreement, understanding, loan, advance or
Guarantee with, or for the benefit of the Tribe, an Affiliate of the Tribe or an Affiliate
of the Authority (each of the foregoing, an "Affiliate Transaction"), unless (i) such
Affiliate Transaction is on terms that are no less favorable to the Authority than those
that would have been obtained in a comparable transaction by the Authority with an unrelated
Person, and (ii) the Authority delivers to the Developer (a) with respect to any Affiliate
Transaction involving aggregate payments in excess of Two Million Dollars ($2,000,000), a
resolution adopted by the Authority approving such Affiliate Transaction and set forth in an
Officer's Certificate a certification that such Affiliate Transaction complies with clause
(i) above, and (b) with respect to any Affiliate Transaction involving aggregate payments in
excess of Ten Million Dollars ($10,000,000), a written opinion as to the fairness to the
Authority from a financial point of view issued by an Independent Financial Advisor.
10.3 Subsidiaries. The Authority will not create, acquire or own any
------------
instrumentality, subdivisions or subunits unless the actions and assets of such
instrumentalities, subdivisions or subunits are subject to or bound by the terms of this
Agreement.
10.4 Business Purpose. During the Term, the Authority (or any assignee of the
-----------------
Authority permitted under this Agreement), directly or indirectly, shall not engage in any
business or activity other than the Principal Business.
10.5 Operation of Gaming Facility. During the Term, the Authority shall operate the
----------------------------
Gaming Facility for the primary purpose of conducting Gaming, in accordance with all
applicable Compact provisions, related agreements and regulations.
10.6 Replacement or Restoration Following Casualty. If all or a portion of the
-------------------------------------------------
Facilities are damaged by fire or other casualty, the Authority promptly shall cause the
Facilities to be replaced or restored to substantially the same condition (or better) as
immediately prior to the occurrence of such fire or other casualty; provided, however, that
in no event shall the Authority be obligated to expend for any replacement or restoration an
amount in excess of the insurance proceeds recovered by the Authority and allocable to the
damage to the Facilities after deduction of any amounts required to be paid to any holder of
Indebtedness. If insurance proceeds are not available to the Authority for such replacement
or restoration, the Authority shall use reasonable efforts to obtain financing on
commercially reasonable terms (including terms which provide recourse only to cash of the
Authority and undistributed and future revenues of the Authority) to undertake such
replacement or restoration of the Facilities.
ARTICLE 11
TERMINATION
11.1 Material Breach. This Agreement may only be terminated by the Authority or
----------------
the Developer if the other party commits any material breach or fails to perform any
material duty or obligation of this Agreement. Upon learning of a material breach or
default, the non-breaching party shall send written notice of: (i) any monetary material
breach or default to the breaching party within ten (10) days of learning of the breach, and
(ii) any nonmonetary material breach within thirty (30) days of learning of the breach. If
the breaching party fails to cure the material breach or default within forty-five (45) days
of receipt of such written notice from the non-breaching party, the non-breaching party may
terminate this Agreement by providing the defaulting party with a notice of termination
(which shall be immediately effective). Notwithstanding the above, the Tribe and the
Authority shall have no right to terminate this Agreement for any reason after the
Completion Date of the first Phase of the Gaming Facility; provided, however, that if the
Developer acts in bad faith or is grossly negligent with respect to Developer's obligations
to perform development services related to expansions of the Project after the Completion
Date of the first Phase of the Project, unreasonably refuses to perform any material
development services related to future Phases of the Project after being reasonably directed
to do so by the Authority or fails to continue to meet the suitability requirements for
licensure pursuant to Section 8.8 of this Agreement: then (i) the Authority, subject to the
provisions of Article 12 of this Agreement, as its sole remedy under this Agreement, may
terminate Developer's exclusive rights to perform development services related to expansions
of the Project as set forth in Recital F, and (ii) Developer shall be paid a Developer Fee
for the remainder of the Term of this Agreement in an annual amount equal to the amount
earned by Developer under this Agreement in the calendar year immediately preceding the
termination of Developer's future services (e.g., if Developer's annual Developer Fee in the
calendar year immediately preceding the termination of Developer's exclusive development
rights is $20 million, the annual Developer Fee payable to Developer for each year (or
portion thereof) of the remainder of the Term of the Agreement would be $20 million,
prorated for any partial year).
11.2 Failure of Tribe to Obtain Required Approvals. The failure of the Tribe
--------------------------------------------------
and/or the Authority to obtain the Required Approvals by December 31, 2002 shall be grounds
for termination of this Agreement by the Developer upon written notice to the Tribe and/or
the Authority. Neither the Tribe nor the Authority has any liability for any funds expended
or committed by the Developer under this Agreement in the event of termination under this
Section 11.2.
11.3 Failure to Secure Agreements Under Article 6. The failure to secure the
-------------------------------------------------
Financing Agreements and/or Completion Guaranty in accordance with Sections 6.2 and 6.3 of
this Agreement, or any one of them, by December 31, 2004, shall be grounds for termination
of this Agreement by the Authority upon written notice to the Developer. Neither the Tribe
nor the Authority has any liability for any funds expended or committed by the Developer
under this Agreement in the event of termination under this Section 11.3.
11.4 Stay of Termination Pending Arbitration. If a party shall exercise its right
-----------------------------------------
to terminate pursuant to Sections 11.1, 11.2 or 11.3 above, and there is a material dispute
in arbitration with respect to the terms of this Agreement or circumstances regarding such
termination pending, then the termination shall be stayed until such time as the issue is
resolved.
ARTICLE 12
DISPUTE RESOLUTION
12.1 Authority's Limited Consent to Suit. (a) The Authority, a subordinate economic
-----------------------------------
entity chartered by the Tribe pursuant to the Tribal Council's power under Article VII,
Section 1(g) of the Tribe's Constitution, shares the Tribe's sovereign immunity. Subject to
Section 12.4 below, the Authority (and the Tribe on behalf of the Authority) expressly
waives the Authority's immunity from unconsented suit, solely for the purpose of permitting
the Developer to seek the following actions and remedies: (i) the enforcement of an award
of actual damages by arbitration; provided, however, that the arbitrator(s) and/or the court
shall have no authority or jurisdiction to order execution against any assets or revenues of
the Authority except those set forth in Section 12.4 below, (ii) the enforcement of a
determination by an arbitrator that prohibits the Authority from taking an action that would
prevent the operation of this Agreement or the Developer from performing this Agreement
pursuant to its terms, or that requires the Authority to specifically perform any obligation
under this Agreement, (iii) an action to compel arbitration pursuant to Section 12.3 and/or
to preserve the status quo for forty-five (45) days during disputes as required by Section
12.6 for which a demand notice for arbitration has been given pursuant to Section 12.3, and
(iv) an action to enforce the provisions of Sections 13.15 and 13.18 of this Agreement
during a pending dispute for which a demand notice for arbitration has been given pursuant
to Section 12.3, in the event the Authority breaches Section 13.15 or 13.18 prior to the
entry of an arbitrator's order under Section 12.3, or if the arbitrator has refused to issue
an order under Section 12.3 regarding the enforcement of the provisions of Section 13.15 or
13.18. The parties agree that any suit commenced pursuant to this Section 12.1 shall be
brought in: (a) the United States District Court for the Southern District of New York (and
appeals therefrom shall be brought in the United States Circuit Court of Appeals for the
Second Circuit and the United States Supreme Court) or (b) if the United States Federal
Courts lack jurisdiction, in the Supreme Court of New York (and appeals therefrom shall be
brought in the New York State Appellate Courts) or, (c) if none of the foregoing courts have
jurisdiction, then in any court of competent jurisdiction including, but not limited to, the
Gaming Disputes Court or Tribal Court. The Authority, subject to the provisions of this
Section 12.1, hereby: (i) accepts the exclusive jurisdiction of the aforesaid courts, (ii)
irrevocably agrees to be bound by any final judgment (after any and all appeals) of any such
court, and (iii) irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of venue of any suit, action or proceedings
brought in any such court, and further irrevocably waives, to the fullest extent permitted
by law, any claim that any suit, action or proceedings brought in any such court has been
brought in any inconvenient forum, and (iv) with respect to the enforcement of an award
rendered in an arbitration conducted pursuant to Section 12.3, the Authority hereby
irrevocably accepts and submits to the exclusive jurisdiction of such Court with respect to
any such action, suit or proceeding. The Authority and the Tribe, on behalf of the
Authority, expressly waive any requirement of exhaustion of tribal remedies, and agree that
they will not present any affirmative defense based on any alleged failure to exhaust such
remedies. The limited waiver contained in this Section 12.1 shall be strictly construed as
limited to the actions and remedies contained herein against the Authority, and shall not be
construed as limiting the power of the arbitrator or the court to award remedies provided
for in this Agreement against any other Parties to this Agreement.
(b) Service of Process. The Authority hereby appoints CSC The United States
-------------------
Corporation Company, 00 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxx, Xxx Xxxx 00000, as its
authorized agent on which any and all legal process may be served in any action, suit or
proceeding which is brought in any Court referenced above. The Authority agrees that
service of process upon such agent, together with notice of such service given as provided
in Section 13.6, shall be deemed to be effective service of process upon it in any action,
suit or proceeding referred to in this Section 12.1. If for any reason such agent shall
cease to be available to act as such, the Authority agrees to designate a new agent in New
York, on the terms and for the purposes of this Section 12.1, and the Authority shall, as
soon as practicable, give notice to the other Parties of such new agent. Nothing herein
shall be deemed to limit the ability of any party hereto to serve any such legal process in
any other manner permitted by applicable law.
12.2 Tribe's Limited Consent to Suit. (a) If: (a) the Authority, or a successor
---------------------------------
entity formed pursuant to Section 13.8 of this Agreement, is no longer in existence, or has
had its authority to perform the Authority's obligations and responsibilities under this
Agreement diminished or abolished, or (b) the arbitrator or a court compelling arbitration
or enforcing an arbitrator's award finds that the Tribe is an indispensable party (as that
term is defined in the rules of the American Arbitration Association, the Federal Rules of
Civil Procedure or the New York Rules of Civil Procedure), so that arbitration cannot
proceed unless the Tribe is joined, or (c) the Tribe breaches the provisions of Section
13.15 or 13.18 of this Agreement, then the Tribe expressly agrees (subject to the
limitations set forth in Section 12.4 of this Agreement) to a limited waiver of its immunity
from unconsented suit, solely for the purpose of permitting the Developer to seek the
following actions and remedies: (i) the enforcement of an award of actual damages by
arbitration; provided, however, that the arbitrator and/or the court shall have no authority
or jurisdiction to order execution against any assets or revenues of the Tribe except those
set forth in Section 12.4 below, (ii) the enforcement of a determination by an arbitrator
that prohibits the Tribe from taking an action that would prevent the operation of this
Agreement pursuant to its terms, or that requires the Tribe to specifically perform any
obligation under this Agreement, (iii) an action to compel arbitration pursuant to Section
12.3 and/or to preserve the status quo for forty-five (45) days during disputes as required
by Section 12.6 for which a demand notice for arbitration has been given pursuant to Section
12.3, and (iv) an action to enforce the provisions of Sections 13.15 and 13.18 of this
Agreement during a pending dispute for which a demand notice for arbitration has been given
pursuant to Section 12.3, in the event the Tribe breaches Section 13.15 or 13.18 prior to
the entry of an arbitrator's order under Section 12.3 or if the arbitrator has refused to
issue an order under Section 12.3 enforcing the provisions of Section 13.15 or 13.18. Any
action brought under this Section 12.2 shall be brought in the courts set forth in Section
12.1. The Tribe, subject to the provisions of this Section 12.2, hereby: (i) accepts the
exclusive jurisdiction of the aforesaid courts, (ii) irrevocably agrees to be bound by any
final judgment (after any and all appeals) of any such court, and (iii) irrevocably waives,
to the fullest extent permitted by law, any objection which it may now or hereafter have to
the laying of venue of any suit, action or proceedings brought in any such court, and
further irrevocably waives, to the fullest extent permitted by law, any claim that any suit,
action or proceedings brought in any such court has been brought in any inconvenient forum,
and (iv) with respect to the enforcement of any award rendered in an arbitration conducted
pursuant to Section 12.3, the Tribe hereby irrevocably accepts and submits to the exclusive
jurisdiction of such Court with respect to any such action, suit or proceeding. The Tribe
expressly waives any requirement of exhaustion of tribal remedies, and agrees that it will
not present any affirmative defense based on any alleged failure to exhaust such remedies.
The Tribe's limited consent to suit is expressed by a resolution of the Tribal Council (the
"Resolution") which Resolution is attached as Exhibit A to this Agreement and incorporated
herein solely for the purpose of referencing this Section 12.2. To the extent any
inconsistency exists between the provisions of this Section 12.2 and the Resolution, the
provisions of this Section 12.2 shall prevail. The limited waiver contained in this Section
12.2 shall be strictly construed as limited to the actions and remedies contained herein
against the Tribe, and shall not be construed as limiting the power of the arbitrator or the
court to award remedies provided for in this Agreement against any other Parties to this
Agreement.
(b) Service of Process. The Tribe hereby appoints CSC The United States
--------------------
Corporation Company, 00 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxx, Xxx Xxxx 00000, as its
authorized agent on which any and all legal process may be served in any action, suit or
proceeding which is brought in any Court referenced to above. The Tribe agrees that service
of process upon such agent, together with notice of such service given as provided in
Section 13.6, shall be deemed to be effective service of process upon it in any action, suit
or proceeding referred to in this Section 12.2. If for any reason such agent shall cease to
be available to act as such, the Tribe agrees to designate a new agent in New York, on the
terms and for the purposes of this Section 12.2, and the Tribe shall, as soon as
practicable, give notice to the other parties of such new agent. Nothing herein shall be
deemed to limit the ability of any party hereto to serve any such legal process in any other
manner permitted by applicable law.
12.3 Arbitration. All disputes, controversies, or claims arising out of or
-----------
relating to this Agreement or the termination of this Agreement shall be settled by binding
arbitration in accordance with the commercial arbitration rules of the American Arbitration
Association and the Federal Arbitration Act. The parties agree that binding arbitration
shall be the sole remedy as to all disputes, controversies, or claims arising out of or
relating to this Agreement, unless the parties mutually agree in writing otherwise. The
arbitrator(s) shall have no authority to award consequential, incidental or punitive
damages, or attorney's fees or costs but, shall have the authority to award actual damages
and/or equitable relief, including, but not limited to, an emergency order for temporary or
preliminary injunctive relief entered on short notice to preserve the status quo for 45 days
during disputes as required by Section 12.6 of this Agreement, and an emergency order for
temporary or preliminary injunctive relief entered on short notice enforcing the provisions
of Sections 13.15 and 13.18 of this Agreement. In determining any matter, the arbitrator(s)
shall apply the terms of this Agreement, including, without limitation, Sections 12.4 and
12.5, without adding to, modifying or changing the terms in any respect, and shall apply the
laws of the State of New York. All arbitration hearings shall be held at a place designated
by the arbitrator(s) in New York, New York. Arbitration shall be initiated by the Party
making the claim by service of a demand notice for arbitration pursuant to Section 13.6 of
this Agreement within one-hundred eighty (180) days of actual notice of the claim.
12.4 Limited Liability of the Tribe; Authority's or Tribe's Assets. Nothing in
--------------------------------- -------------------------------
this Agreement shall obligate or authorize the payment or encumbrance of any assets or
revenues of the Authority or the Tribe other than cash of the Authority (except to the
extent the Authority can demonstrate such cash was derived from a source other than the
Facilities) and undistributed and future revenues of the Facilities. No director, officer or
office holder, employee, agent, representative or member of the Authority or the Tribe shall
have any personal liability for any obligations of either the Tribe or the Authority under
this Agreement or for any claim based upon, in respect of, or by reason of such Agreement,
or related in any manner whatsoever to this Agreement. Except as set forth in Section 12.2
of this Agreement, the Tribe shall not have any liability for any obligations of the
Authority under this Agreement or for any claim based upon, in respect of, or by reason of
such obligations or their creation.
12.5 Limit of Damages Payable by Developer. Notwithstanding anything in this
------------------------------------------
Agreement to the contrary, the Developer shall not be liable hereunder for the payment of
damages to the Authority in excess of the amount of Ten Million ($10,000,000.00) Dollars.
12.6 Performance During Disputes. The parties mutually agree that during any kind
-----------------------------
of controversy, claim, disagreement or dispute, including, without limitation, a dispute as
to the validity of this Agreement, the Authority and the Developer shall continue their
performance of the provisions of this Agreement for a period of forty-five (45) days from
receipt of a notice of material breach pursuant to Section 11.1, provided funds necessary to
pay Project costs which continue to be incurred (other than amounts in dispute) continue to
be available.
ARTICLE 13
MISCELLANEOUS PROVISIONS
13.1 Force Majeure Events. Notwithstanding anything in this Agreement to the
----------------------
contrary, the parties hereto shall be excused from their obligations hereunder to the extent
and for so long as such party shall be prevented from compliance by reason of "Force Majeure
Causes," provided notice of such inability to comply is given to the other party to this
Agreement within ten (10) days after actual knowledge of the occurrence by the party giving
notice of the applicable Force Majeure Cause.
13.2 Authorization. The Parties represent and warrant to each other that each has
-------------
full power and authority to execute this Agreement and to be bound by and perform the terms
hereof. Each party shall furnish evidence of such authority to the other. The parties each
represent and warrant to the other that the execution, delivery and performance of this
Agreement shall not conflict with the terms of their organizational documents, any agreement
to which it is a party or by which it is bound or any law, rule or regulation to which it is
subject.
13.3 Relationship. The Tribe, the Developer and the Authority shall not be
------------
construed as joint venturers or partners of each other by reason of this Agreement, and
neither shall have the power to bind or obligate the other except as set forth in this
Agreement. The Developer is retained by the Tribe and the Authority only for the purposes
and to the extent set forth in this Agreement, and the Developer's relationship to the Tribe
and the Authority shall be that of an independent contractor.
13.4 Governing Law. The rights and obligations of the parties and the
---------------
interpretation and performance of this Agreement shall be governed by the laws of the State
of New York.
13.5 Amendment. No modification or amendment to this Agreement shall be effective
---------
unless mutually agreed upon by the parties in writing and unless such modification or
amendment has received any required regulatory approval.
13.6 Notices. All notices, demands, requests or other communications which may be
-------
or are required to be given, served or sent to any party in connection with the matters
which are the subject of this Agreement shall be in writing and shall be personally
delivered to such party or mailed first class, certified mail, return receipt requested,
postage prepaid, or transmitted by a major overnight commercial courier or by facsimile to
the address for such party as set forth below, or to such other address furnished by such
parties for such purpose by means of notice pursuant to this Section 13.6:
If to Developer or Developer Guarantors:
c/o Trading Cove
000 Xxxxxxxx Xxxxxxxx
X.X. Xxx 00
Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxx, Chief Executive Officer
Phone: (000) 000-0000
Facsimile: (000) 000-0000
With copies to:
x/x Xxx Xxxxxxxxxxxxx
Xxxxx Xxxxxx
X.X. Xxx X-0000
Paradise Island
Nassau, The Bahamas
Attn: Xxxxxxx Xxxxx
Phone: (000) 000-0000
Facsimile: (000) 000-0000
And to:
Xxxxx, Xxxxxxxx & Flexner LLP
00 Xxxxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxxx, Esq.
Phone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Tribe or the Authority:
c/o Xxxxxxxxxxx-Xxxxxx Band of Mohican Indians
N8476 MohHeCon Xxxx Xxxx
X. X. Xxx 00
Xxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx Chicks, Tribal President
Phone: (000) 000-0000
Facsimile: (000) 000-0000
With copy to:
Xxxxxxxxxxx-Xxxxxx Band of Mohican Indians
N8476 MohHeCon Xxxx Xxxx
X. X. Xxx 00
Xxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx Xxxxxx-Xxxxxxxxxx, Tribal Attorney
Phone: (000) 000-0000
Facsimile: (000) 000-0000
And to:
Xxxxxxxx X. Arts, Esq.
Xxxxxxx & Xxxxx LLP
Firstar Plaza
Xxx Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxx 00000-0000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Notices delivered by mail shall be deemed given five (5) days after such mailing.
Notices given by hand delivery shall be deemed given on the date of delivery. Notices given
by overnight commercial courier shall be deemed given on the business day immediately
following transmittal, and notices delivered by facsimile shall be deemed given on the date
of transmission if the transmission is confirmed.
13.7 Third Party Beneficiary. This Agreement is exclusively for the benefit of the
------------------------
parties hereto, and it may not be enforced by any party other than the parties to this
Agreement and shall not give rise to liability to any third party other than the authorized
successors and assigns of the parties pursuant to Section 13.8.
13.8 Successors and Assigns. The benefits and obligations of this Agreement shall
----------------------
inure to and be binding upon the parties hereto and their respective successors and
assigns. This Agreement shall not be assigned by the Developer or the Developer Guarantors
without the prior written consent of the Authority (which consent shall not be unreasonably
withheld) and any required approvals by the Bureau of Indian Affairs or its authorized
representatives; provided, however, that Developer shall (i) have the right to assign the
receipt of Developer Fee payments at any time without the consent of the Authority and (ii)
shall have the right to assign this Agreement after the completion of the Project without
the consent of the Authority provided the assignee complies with the licensing provisions of
Section 8.8 of this Agreement. This Agreement shall not be assigned by the Authority
without the prior written consent of the Developer (which consent shall not be unreasonably
withheld), provided, however, that the Authority may, without the consent of the Developer,
but subject to any required approvals of the Bureau of Indian Affairs or its authorized
representative, assign this Agreement to the Tribe, another instrumentality of the Tribe or
an entity wholly owned by the Tribe organized to conduct the Authority's gaming enterprise
and the business of the Facility if such assignment is made after the Effective Date,
provided such entity has credit worthiness equal to or greater than the Authority. In the
event of any such permitted assignment by the Authority, the Authority's authorized
assignee, or the Developer, the assigning party shall be relieved of its obligations under
this Agreement which accrue from and after the date of the assignment, provided that the
assignee shall assume in writing the obligations of the assignor under this Agreement and
agree to perform and be bound by the terms and provisions hereof effective from and after
the date of such assignment.
13.9 Severability. The invalidity of any one or more provisions hereof or of any
------------
other agreement or instrument given pursuant to or in connection with this Agreement shall
not affect the remaining portions of this Agreement or any such other agreement or
instrument or any part thereof, all of which are inserted conditionally on their being held
valid in law; and in the event that one or more of the provisions contained herein or
therein should be invalid, or should operate to render this Agreement or any such other
agreement or instrument invalid, the parties agree to negotiate, in good faith, to modify or
amend such invalid provision to obtain for the parties the intended benefits of such
provision (or this Agreement and such other agreements and instruments shall be construed as
if such invalid provision had not been inserted).
13.10 Entire Agreement. This Agreement (including any exhibits referred to herein)
-----------------
represents the entire agreement between the parties hereto with respect to the subject
matter hereof. No other representations, warranties, promises or agreements, express or
implied, shall exist between the parties unless such representations, warranties, promises
or agreements are in writing and bear a date subsequent to the date of this Agreement.
13.11 Headings. The headings used in this Agreement are for the convenience of the
--------
parties only and shall not modify nor restrict any of the terms or provisions hereof.
13.12 Waivers. No failure or delay by the Developer, the Tribe or the Authority to
-------
insist upon the strict performance of any covenant, agreement, term or condition of this
Agreement, or to exercise any right or remedy consequent upon the breach thereof, shall
constitute a waiver of any such breach or any subsequent breach of such covenant, agreement,
term, or condition. No covenant, agreement, term or condition of this Agreement and no
breach thereof shall be waived, altered or modified except by written instrument. No waiver
of any breach shall affect or alter this Agreement, but each and every covenant, agreement,
term and condition of this Agreement shall continue in full force and effect with respect to
any other then existing or subsequent breach thereof.
13.13 Periods of Time. Unless otherwise specified herein, all references to "days"
---------------
shall mean calendar days. Whenever any determination is to be made or action is to be taken
on a date specified in this Agreement, if such date shall fall on a Saturday, Sunday or
legal holiday under Rule 6(a), Federal Rules of Civil Procedures, then in such event said
date shall be extended to the next day which is not a Saturday, Sunday or legal holiday.
13.14 Consents and Approvals. Where approval or consent or other action of the
------------------------
Tribe or the Authority, or any agent or political subdivision of the Tribe or the Authority,
is required, such approval shall not be unreasonably withheld and shall mean the written
approval of the Tribe or the Authority evidenced by a duly enacted resolution thereof, or,
if not provided by resolution of the Tribe or the Authority, the written approval of the
Tribal President or the Authority Chairperson (to the extent authorized by such entity) or
such other person or entity designated by resolution of the Tribe or the Authority. Where
approval or consent or other action of the Developer is required, such approval shall not be
unreasonably withheld and shall mean the written approval of the members of the Developer
evidenced by a duly enacted resolution thereof, or, if not provided by resolution of the
Developer, the written approval of the managing member (to the extent authorized by such
entity) or such other person or entity designated by resolution of the Developer. If the
approval of the Developer, the Tribe or the Authority is required hereunder, the Developer,
the Tribe or the Authority, as the case may be, shall request such approval in writing,
which request shall specify the matter as to which such approval is requested and provide
reasonable detail regarding such matter.
13.15 Government Savings Clause. This Agreement shall be submitted to the Bureau of
--------------------------
Indian Affairs for its approval pursuant to its authority under 25 U.S.C. 81 and the NIGC,
to the extent required by law. In addition, each party agrees to pursue such approval and
execute, deliver, and if necessary, record any and all additional instruments,
certifications, amendments, modifications and other documents as may be required by the
United States Department of the Interior, the BIA, the Office of the Field Solicitor, or any
applicable statute, rule or regulation in order to effectuate, complete, perfect, continue
or preserve the respective rights, obligations and interest of the parties to the fullest
extent permitted by law; provided that any such instrument, certification, amendment,
modification or other document shall not materially change the respective rights, remedies
or obligations of the parties under this Agreement or related agreements or documents.
13.16 Termination of Prior Agreements. As of the date hereof, the Tribe, the
----------------------------------
Authority and the Developer terminate all prior agreements, arrangements or understandings
and all covenants, terms and provisions contained therein with respect to the Project and
development and construction of facilities on the Property, including, without limitation,
the MOU.
13.17 Representation before Public Bodies. Without the prior written consent of the
------------------------------------
Tribe or the Authority, the Developer shall have no right or authority to represent the
Authority before public and governmental bodies in connection with any zoning,
environmental, site, easement, title, design, construction or other matter related to the
Project.
13.18 Non-Impairment of Agreement. The Tribe and the Authority (as applicable),
-----------------------------
directly or indirectly, shall not impose any tax, levy or, other monetary payment obligation
on the Authority or on any activity at the Facilities during the term of this Agreement.
The Tribe and the Authority (as applicable) shall not, directly or indirectly, take any
action, enter into any agreement, amend its Constitution or enact or amend any ordinance,
law, rule or regulation that would prejudice or have a material adverse affect on the rights
of the Developer under this Agreement. Neither the Tribe nor the Authority nor any
committee, agency, board or other official body of the Tribe shall, by exercise of executive
action, police power, eminent domain or otherwise, act to modify, amend or in any manner
impair the obligations of the parties under this Agreement without the written consent of
the Developer. Any such action or attempted action shall be void ab initio. The Tribe and
the Authority acknowledge that the arbitrator specified in Section 12.3 of this Agreement
and the courts specified in Sections 12.1 and 12.2 of this Agreement have the authority to
provide equitable relief to enforce the provisions of this Section 13.18.
13.19 Confidential Proprietary Information. Each party agrees to treat as
-----------------------------------------
confidential all non-public information received during the performance of this Agreement
regarding the other party, its organization, financial matters, marketing plans or other
affairs. Except as may be required by law, no such information will be disclosed to any
person, firm or organization without the prior written approval of the other party. Except
as may be required by law or regulation, the parties to this Agreement shall not issue or
make any press release or public announcement regarding the subject matter of this Agreement
or the Project without the prior written approval of the other parties. The parties agree
that the sole spokespersons under this Agreement shall be Xxxxxx Chicks, Tribal President
for the Tribe, and Xxx Xxxxxx or X. X. Xxxxxxx, Managing Members for the Developer, or their
authorized successor or representative.
13.20 Tolling of this Agreement. If any Casualty Event occurs prior to completion
-------------------------
of the Gaming Facility, the Developer shall give prompt notice thereof to the Authority.
After the Completion Date, the Authority shall give prompt notice thereof to the Developer.
If, within thirty (30) days following receipt of such notice, the Developer delivers written
notice to the Authority electing to implement this Section 13.20, then the Term shall be
tolled for such number of full calendar months commencing with the calendar month
immediately following such Tolling Event and ending with (and including) the calendar month
immediately prior to the Recommencement Month (the "Tolling Period"). The expiration of
this Agreement (and the obligations of the Authority to make payments of the Developer Fees
hereunder) shall be extended for such number of full calendar months included in the Tolling
Period. During the Tolling Period, the Authority shall have no obligation to make payments
of any Developer Fee.
13.21 Developer Guarantee. The Developer Guarantors hereby join in this Agreement
--------------------
for the sole purpose of guaranteeing Developer's obligations set forth in Section 6.3 and
6.4 of this Agreement. Any action of the Authority or the Tribe seeking to enforce the
provisions of this Section 13.21 shall be brought solely pursuant to the arbitration
provisions of Section 12.3, and the Developer Guarantors hereby consent to such arbitration
proceeding.
13.22 Service of Process on Developer or the Developer Guarantors. The Developer and
-----------------------------------------------------------
the Developer Guarantors hereby appoint CSC The United States Corporation Company, 00 Xxxxx
Xxxxxx, Xxxxx Xxxxx, Xxxxxx, Xxx Xxxx 00000, as their authorized agent on which any and all
legal process may be served in any action, suit or proceeding arising out of this
Agreement. The Developer and the Developer Guarantors agree that service of process in
respect of them upon such agent, together with notice of such service given as provided in
Section 13.6, shall be deemed to be effective service of process upon them in any action,
suit or proceeding arising out of this Agreement. If for any reason such agent shall cease
to be available to act as such, the Developer and the Developer Guarantors agree to
designate a new agent in New York, on the terms and for the purposes of this Agreement, and
the Developer and the Developer Guarantors shall, as soon as practicable, give notice to the
other parties of such new agent. Nothing herein shall be deemed to limit the ability of any
party hereto to serve any such legal process in any other manner permitted by applicable law.
13.23 Copies. All parties to this Agreement acknowledge that they have received two
------
duplicate copies of the fully executed Agreement.
13.24 Federal Approval. This Agreement will not be enforceable unless and until
-----------------
approved by the appropriate federal authorities pursuant to §.25 U.S.C.§. 81 (if such
approval is required), and the signature of the approving official is affixed to this
Agreement.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the Tribe, the Developer and the Developer Guarantors have
executed this Agreement on and as of the date first written above, and the Authority has
executed this Agreement on the date set forth below.
THE TRIBE:
XXXXXXXXXXX-XXXXXX BAND OF MOHICAN
INDIANS
By: ___________________________
Name: Xxxxxx Chicks
Its: Tribal Council President
DEVELOPER:
TRADING COVE NEW YORK, L.L.C.
By: Waterford Development New York, L.L.C.,
Member
By: ___________________________
Name: Xxx Xxxxxx
Its: Chief Executive Officer
By: Sun Cove New York, Inc.,
Member
By: ___________________________
Name: X.X. Xxxxxxx
Its: President
DEVELOPER GUARANTORS:
SUN INTERNATIONAL NORTH AMERICA, INC.
By:__________________________________
Name: Xxxxxxx X. Xxxxxx
Its: Senior Vice President & Corporate Counsel
WATERFORD GAMING GROUP, LLC
By:___________________________________
Name: Xxx Xxxxxx
Its: Chief Executive Officer
Accepted and Agreed to as of this
____ day of _________, 2001 by:
THE AUTHORITY
XXXXXXXXXXX-XXXXXX TRIBAL GAMING
AUTHORITY
By: _________________________________
Name: Xxxxxx Chicks
Its: Chairperson
Date:____________ Approved Pursuant to 25 U.S.C.§.81
United States Department of Interior
Bureau of Indian Affairs:
By: ___________________________
Name:___________________________
Title:__________________________
