Exhibit 10.9J
NINTH AMENDMENT TO OPERATING AGREEMENT
This NINTH AMENDMENT TO OPERATING AGREEMENT is made and entered into this
______ day of July, 1995, between DUBUQUE RACING ASSOCIATION, LTD., an Iowa
nonprofit corporation, (hereinafter referred to as "DRA") and GREATER DUBUQUE
RIVERBOAT ENTERTAINMENT COMPANY, L.C., an Iowa limited liability company,
(hereinafter referred to as "Greater Dubuque").
RECITALS:
A. On February 22, 1993, DRA and Greater Dubuque signed an Operating
Agreement setting forth their respective rights, duties and obligations with
regard to excursion gambling boat operations under Chapter 99F of the Iowa Code.
Amendments to said Operating Agreement were signed on February 22, 1993, March
4, 1993, March 11, 1993 (two amendments signed on 3/11/93), April 9, 1993,
November 29, 1993, April 6, 1994, and April 29, 1994, amending said Operating
Agreement. (The term "Operating Agreement" as used hereafter shall refer to the
original Operating Agreement as amended by all prior amendments and by this
Ninth Amendment, except where reference is made to the "original" Operating
Agreement, or to the Operating Agreement as amended previous to this Ninth
Amendment.)
B. Subsequent to the adoption of the original Operating Agreement, the
Iowa legislature amended Chapter 99F, providing for the licensing of pari-mutuel
racing licensees to conduct gambling games within their racetrack enclosures,
and providing certain requirements for the ownership and control of such
operations by the pari-mutuel racing licensee.
C. Greater Dubuque has submitted an application dated May 18, 1995 to the
Iowa Racing and Gaming Commission to bring a new and substantially larger
excursion gambling riverboat to Dubuque.
D. DRA plans to operate gambling games at a racetrack enclosure at
Dubuque Greyhound Park upon approval of the Iowa Racing and Gaming Commission.
E. The respective plans of both parties have substantial financial effects
upon the other parties.
F. DRA and Greater Dubuque have entered into negotiations for the purposes
of adjusting their relationship in order to accomplish their respective goals
over the remaining term of the
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Operating Agreement and extensions thereof, and to resolve the major outstanding
issues between them.
G. DRA and Greater Dubuque have jointly agreed to further amend the terms
of the Operating Agreement, as previously amended.
NOW, THEREFORE, IT IS AGREED that the February 22, 1993 Operating
Agreement, as previously amended, is further amended as follows:
1. For purposes of this Ninth Amendment to Operating Agreement:
(a) the term "New Boat" shall mean one or more of the following as
specified elsewhere in this Ninth Amendment:
(1) The excursion gambling riverboat(1), identified and equipped as
described in Greater Dubuque's application dated May 18, 1995 to the
Iowa Racing and Gaming Commission; OR
(2) An excursion gambling riverboat, approved by the Iowa Racing and
Gaming Commission, that is operated under the Operating Agreement,
as a replacement of the boat described in subparagraph 1(a)(1) above
and which is of equal or greater size than the boat described in
subparagraph 1(a)(1) above. "Size" for purposes of this provision
shall mean: (1) total passenger capacity or (2) total gaming
positions. This definition is not a consent by DRA to any such
replacement boat, which shall be subject to Iowa Racing and Gaming
Commission approval.
Any other boat is not a "New Boat" and is subject to subparagraphs
4(a)(2), 4(a)(3), and 4(a)(5) of the Operating Agreement. There shall be
only one boat (New Boat or otherwise) under the Operating Agreement at any
point in time.
(b) "Land-based casino" shall mean the operation by DRA of any games
permitted by the Iowa Code, regulations thereunder, and the Iowa
Racing and Gaming Commission; it shall not include pari-mutuel dog
racing or the revenues therefrom.
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(1) Excursion gambling boat or riverboat shall mean a self-propelled
excursion boat on which lawful gambling is authorized and licensed by the Iowa
Racing and Gaming Commission.
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2. Paragraph 1 of the Operating Agreement is amended by adding the
following as new subparagraphs immediately after the first subparagraph:
"Greater Dubuque shall have the option to renew and extend the
Operating Agreement, for a third consecutive three-year term commencing
April 1, 2002, provided that: (1) Greater Dubuque exercised its option for
a second 3-year renewal term commencing April 1, 1999 and materially
performed during said option period according to the terms of the
Operating Agreement, (2) a county referendum re-authorizing riverboat
gambling operations is approved by the voters of Dubuque County pursuant
to Iowa Code ss.99F.7(10)(c), if such requirement remains in effect at
that time; (3) Greater Dubuque continues to operate a New Boat, as defined
in subparagraphs 1(a)(1) and 1(a)(2) of this Ninth Amendment, at the time
the additional option period provided below would commence, (4) both DRA
and Greater Dubuque remain as licensed entities in good standing with the
Iowa Racing and Gaming Commission and are in compliance with all material
terms of the Operating Agreement, and (5) neither Greater Dubuque nor a
corporation or business entity owned or controlled by Greater Dubuque, its
owners, or its successors or assigns, is the operator of any gambling
operation in Dubuque County, Iowa, Xx Xxxxxxx County, Illinois, or Grant
County, Wisconsin, other than gambling operations conducted on Greater
Dubuque's excursion gambling riverboat operating under the Operating
Agreement. If Greater Dubuque elects to exercise the third option period,
commencing April 1, 2002, it shall deliver written notice of such intent
to DRA not later than September 4, 2001.
Greater Dubuque shall have the option to renew and extend the
Operating Agreement, for a fourth consecutive three-year term commencing
April 1, 2005, provided that: (1) Greater Dubuque exercised its option for
a third 3-year renewal term commencing April 1, 2002, and has materially
performed during said option period according to the terms of the
Operating Agreement, (2) a county referendum re-authorizing riverboat
gambling operations is or was approved by the voters of Dubuque County
pursuant to Iowa Code ss. 99F.7(l0)(c), if such requirement remains in
effect at that time; (3) Greater Dubuque continues to operate the New
Boat, as defined in subparagraphs 1(a)(1) and 1(a)(2) of this Ninth
Amendment, at the time the additional option period provided below would
commence, (4) both DRA and Greater Dubuque remain as licensed entities in
good standing with the Iowa Racing and Gaming Commission and are in
compliance with all material terms of the Operating Agreement, and (5)
neither Greater Dubuque nor a corporation or business entity owned or
controlled by Greater Dubuque, its owners, or its successors or assigns,
is the operator of any gambling operation in Dubuque County, Iowa, Jo
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Daviess County, Illinois, or Grant County, Wisconsin, other than gambling
operations conducted on Greater Dubuque's excursion gambling riverboat
operating under this Operating Agreement. If Greater Dubuque elects to
exercise the fourth option period, commencing April 1, 2005, it shall
deliver written notice of such intent to DRA not later than September 1,
2004."
3. Paragraph 2 of the Operating Agreement is deleted and in lieu thereof
is substituted the following:
"2. DECISION MAKING RESPONSIBILITIES. Except for those decisions which
require DRA's approval pursuant to either statute or the Rules of the Iowa
Racing and Gaming Commission, all decisions pertaining to the excursion
gambling boat operation shall be the sole responsibility of Greater
Dubuque and shall be carried out by Greater Dubuque without the necessity
of consulting with DRA.
Except as provided in the Operating Agreement and except for its
interest and/or rights as a co-licensee pursuant to Iowa law, DRA shall
have no rights to, claims upon, or participation in, directly or
indirectly, the ownership, operation, control, financing, or management of
any excursion gambling boat of which Greater Dubuque is the licensed
operator or any equipment or other facilities used therein now or in the
future, or to the revenues derived therefrom, and further agrees that the
ownership, operation, control, financing, and management of any excursion
gambling boat of which Greater Dubuque is the licensed operator or any
equipment or other facilities used therein, and the revenues derived
therefrom are the sole and complete rights of Greater Dubuque."
4. Subparagraph 4(a)(2) is amended by adding the following prefatory
paragraph at the start thereof:
"THE PROVISIONS OF SUBPARAGRAPHS 4(a)(2) AND 4(a)(3) SHALL APPLY ONLY WHEN
THE PROVISIONS OF SUBPARAGRAPH 4(a)(4) ARE NOT APPLICABLE."
5. Subparagraph 4(a)(3) is amended by adding the following prefatory
paragraph at the start thereof:
"THE PROVISIONS OF SUBPARAGRAPHS 4(a)(2) AND 4(a)(3) SHALL APPLY ONLY WHEN
THE PROVISIONS OF SUBPARAGRAPH 4(a)(4) ARE NOT APPLICABLE."
6. Subparagraphs 4(a)(4) and 4(a)(5) of the Operating Agreement are
created as follows:
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"(4) This subparagraph 4(a)(4) shall commence to apply on the date that
DRA's land-based casino operations are open to the general public;
provided, however, that:
(i) if Greater Dubuque's New Boat, as defined in subparagraph
1(a)(1) of this Ninth Amendment, is not open to the general public
for riverboat casino gambling in Dubuque on or before December 31,
1995, then this subparagraph 4(a)(4) shall cease to apply and
subparagraphs 4(a)(2) and (4)(a)(3) shall apply commencing January
1, 1996, and continuing until such time as Greater Dubuque's New
Boat, as defined in subparagraph 1(a)(1) of this Ninth Amendment, is
open to the general public for riverboat casino gambling; and
(ii) if Greater Dubuque shall at any time thereafter operate under
the Operating Agreement a boat other than a New Boat as defined in
subparagraphs 1(a)(1) or 1(a)(2) of this Ninth Amendment, then this
subparagraph 4(a)(4) shall not apply and subparagraphs 4(a)(2) and
(4)(a)(3) shall apply commencing at the time Greater Dubuque ceases
operation of a New Boat,(2) and continuing until such time as
Greater Dubuque opens a New Boat, as defined in subparagraphs
1(a)(1) and 1(a)(2) of this Ninth Amendment, in Dubuque to the
general public for riverboat casino gambling under the Operating
Agreement.
(iii) if DRA shall not commence operation of, or shall close,
temporarily or permanently,(3) the operation of a land-based casino,
then this subparagraph 4(a)(4) shall not apply and subparagraphs
4(a)(2) and (4)(a)(3) shall apply according to their terms
commencing at the time DRA no longer offers land-based gambling
games until such time as DRA may resume operation of a land-based
casino.
During periods when this subparagraph 4(a)(4) applies, DRA shall receive the
greater of DRA gaming revenues for such period, or of the following amounts:
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(2) For purposes of this clause, regular business closing hours and
reasonable and temporary business shutdowns of a New Boat, as defined in
subparagraphs 1(a), taken for legitimate business purposes or due to acts of
God, shall not be considered a cessation of operations of a New Boat.
(3) Regular business closing hours and reasonable and temporary business
shutdowns taken for legitimate business purposes or due to acts of God shall not
be considered a closing for purposes of this clause.
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(i) Thirty-two percent (32%) of the first thirty million dollars
($30,000,000.00) of the total gaming revenues, plus
(ii) Eight percent (8%) of total gaming revenues over thirty million
dollars ($30,000,000.00) and less than or equal to forty-two
million dollars ($42,000,000.00), and zero percent (0%) of total
gaming revenues in excess of forty-two million dollars
($42,000,000.00), plus
(iii) For any periods during which the conditions of subparagraph
4(a)(4)(iii)(A), below, exist, eight percent (8%) of total gaming
revenues over forty-two million dollars ($42,000,000.00) and less
than or equal to forty-six million dollars ($46,000,000.00), and
zero percent (0%) of total gaming revenues in excess of forty-six
million dollars ($46,000,000.00):
(A) No excursion boat gambling or land based gambling
operation is carried on by an operator licensee under
the laws of Illinois and/or Wisconsin, with a gambling
dock site or land based gambling site in Xx Xxxxxxx
County, Illinois and/or Grant County, Wisconsin;
provided however, that any such operation carried on by
Greater Dubuque or a corporation or business entity
owned or controlled by Greater Dubuque, its owners, or
its successors or assigns, with or without DRA's consent
under paragraph 11 of the Operating Agreement, shall be
treated for purposes of this paragraph as if no such
operation existed.
(iv) Notwithstanding any other provisions of the Operating
Agreement, however, in no event shall DRA receive from total gaming
revenues for each April 1 - March 31 contract year (or portion
thereof) an amount less than DRA gaming revenues for that contract
year or portion thereof.
(v) In addition to any sums from total gaming revenues or DRA gaming
revenues to which DRA is
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entitled under this subparagraph 4(a)(4), commencing April 1, 2000,
and continuing thereafter, Greater Dubuque shall additionally pay to
DRA the sum of $.50 for each patron admitted on to the New Boat, as
defined in subparagraphs 1(a)(1) and 1(a)(2) of this Ninth
Amendment.
"DRA gaming revenues" as used in this subparagraph 4(a)(4) means
adjusted gross receipts less gaming taxes from all DRA land-based casino
operations; "Greater Dubuque gaming revenues" as used in this subparagraph
4(a)(4) means adjusted gross receipts less gaming taxes from all Greater
Dubuque casino operations at any location; "total gaming revenues" as used
in this subparagraph 4(a)(4) means DRA gaming revenues plus Greater
Dubuque gaming revenues; "adjusted gross receipts" means the gross
receipts less winnings paid to wagerers.
From the date DRA's land-based casino is open to the general public
and through March 31, 1996, payments due under the above formula shall be
calculated every f our weeks and paid within ten (10) days of the end of
each four week period. Commencing at the start of the April 1, 1996 -
March 31, 1997 contract year, and continuing thereafter for periods when
this subparagraph 4(a)(4) is applicable, DRA and Greater Dubuque shall
settle the account every four weeks on an annualized basis in accordance
with the following procedure:
Step 1: At the end of each four week period the total gaming
revenues shall be annualized based on a 52-week year at the end of each
four-week period. "Annualized" for this paragraph shall mean dividing the
contract year to date total gaming revenues by a fraction with a numerator
being the weeks of the current contract year that are included in the
four-week settlements year to date and a denominator of 52.
Step 2: The appropriate percentages, as described under (i)-(iv)
above, shall be applied to the annualized total gaming revenues.
Step 3: DRA's gaming revenues shall be annualized using the same
procedure as in Step 1.
Step 4: The computed amount due to DRA under Step 2 shall be reduced
by the annualized DRA land-based casino revenues.
Step 5: The remaining amount from Step 4 shall be multiplied by a
fraction with the numerator being the number of weeks year to date in the
contract year
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and the denominator being 52. The resulting amount, if a positive number,
shall be the amount remitted by Greater Dubuque within ten (10) days of
the end of each four week period. The resulting amount, if a negative
number, shall be the amount refunded by DRA to Greater Dubuque within ten
(10) days of the end of each four week period; provided, however, that DRA
shall make no overage payments to the extent that, at the time such
payment would otherwise be made, it would exceed the amount of net
payments received by DRA from Greater Dubuque from total gaming revenues
for the contract year (April 1-March 31) to date. Any necessary
adjustments at the end of the contract year shall be made not later than
the next following tenth day of April.
To facilitate the account-settling procedure described herein,
within seven days of the end of each four week period DRA and Greater
Dubuque shall forward to each other copies of all Weekly Adjusted Gross
Revenue Tax/Tax Transmittal Reports submitted to the Iowa Racing and
Gaming Commission which reflect combined gaming revenues collected during
the preceding four week period.
Greater Dubuque shall be responsible for remittance of all wagering
taxes owing to the State of Iowa as a result of Greater Dubuque gambling
boat operations under any federal, state, or local law, regulation, or
ordinance. DRA shall be responsible for remittance of all wagering taxes
owing to the State of Iowa as a result of DRA's land-based casino
operations under any federal, state, or local law, regulation, or
ordinance. Greater Dubuque and DRA shall indemnify and hold each other
harmless from and against any and all claims relating to said taxes
arising from their respective operations.
(5) During periods when subparagraph 4(a)(4) is not applicable, the
provisions of subparagraphs 4(a)(2) and 4(a)(3), shall apply in lieu of
the provisions of subparagraph 4(a)(4)."
7. paragraph 5 of the Operating Agreement is deleted and in lieu thereof
is substituted the following:
"5. Greater Dubuque consents to DRA's application for a license to conduct
gambling games at a racetrack enclosure submitted to the Iowa Racing and
Gaming Commission on March 31, 1995; said consent is not a consent or
approval of any future application by DRA to conduct additional gambling
games; Greater Dubuque further acknowledges and agrees that, as of the
date this Ninth Amendment to Operating Agreement is approved by both
parties, except with respect to the use of DRA
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land-based casino revenues in determining the total gaming revenues as
provided in subparagraph 4(a)(4) of the Operating Agreement (when
subparagraph 4(a)(4) is applicable), Greater Dubuque shall have no rights
to, claims upon, or participation in, directly or indirectly, the
ownership, operation, control, financing, and management of any land-based
casino operations at Dubuque. Greyhound Park of which DRA is the licensee
or any equipment or other facilities used therein now or in the future, or
to the revenues derived therefrom, and further agrees that the ownership,
operation, control, financing, and management of DRA land-based casino
operations or any equipment or other facilities used therein, and the
revenues derived therefrom are the sole and complete rights of DRA.
Notwithstanding any other provisions of the Operating Agreement in
no event shall DRA pay to Greater Dubuque any net sums from DRA land-based
casino revenues.
The execution of this Ninth Amendment to Operating Agreement by DRA
and Greater Dubuque shall act as a rescission and revocation, nunc pro
tunc as of the date any such election or option was or could have been
made, of all prior elections or options, (i) which Greater Dubuque has or
could have made with respect to the ownership, operation, control,
financing, and management of DRA's land-based casino operations or any
equipment or other facilities used therein now or in the future under the
text of paragraph 5 of the Operating Agreement as it existed prior to this
Ninth Amendment; and (ii) which DRA has or could have made with respect to
the ownership, operation, control, financing, and management of Greater
Dubuque's excursion gambling boat operations or any equipment or other
facilities used therein now or in the future under the text of the
Operating Agreement as it existed prior to this Ninth Amendment."
8. Paragraph 7 of the Operating Agreement is deleted and the following
substituted therefor:
"7. SALE OF ASSETS/RIGHT OF FIRST REFUSAL. Greater Dubuque and/or
Greater Dubuque's unit holders shall have the absolute right to (i) sell
to a licensable third party, subject to the approval of the Iowa Racing
and Gaming Commission, all or substantially all of the units of Greater
Dubuque or all or substantially all of the assets of Greater Dubuque if
said third party agrees to operate an excursion gambling boat subject to
the terms and conditions of the Operating Agreement and (ii) sell the
excursion gambling boat to any other party provided Greater
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Dubuque replaces the excursion gambling boat with a substitute excursion
gambling boat to be operated by Greater Dubuque under the Operating
Agreement, and subject to approval by the Iowa Racing and Gaming
Commission. For purposes of this clause, "all or substantially all of the
assets of Greater Dubuque" shall mean not less than all of the following:
(i) Greater Dubuque's excursion gambling boat operated under the Operating
Agreement, (ii) Greater Dubuque's interest (whether as lessee, owner, or
otherwise) in "the building," as defined in the immediately following
paragraph, and (iii) Greater Dubuque's interest in the Operating
Agreement.
In the event Greater Dubuque shall desire to sell or lease the
excursion gambling boat and its furnishings and gambling equipment
(hereinafter referred to as "furnishings and equipment") and/or its
interest in any ticket sale facility or other buildings located in the
Dubuque Ice Harbor used in connection with the operation of an excursion
gambling boat and parking rights associated with said facilities
(hereinafter referred to as the "building") constructed and/or purchased
by it, to a third party that does not agree to operate said asset subject
to the terms and conditions of the Operating Agreement, and obtains an
acceptable offer from said third party for the purchase or lease of the
excursion gambling boat and its furnishings and equipment and/or for its
interest in said building, then DRA shall be given written notice of any
such offer, including an executed copy of such offer and any related
purchase or lease document; and DRA shall have the option to purchase or
lease the excursion gambling boat and its furnishings and equipment and/or
Greater Dubuque's interest (including Greater Dubuque's right of first
refusal under its lease with Dubuque Community Investment Co., L.C.), in
the building or its lease of same for the amount of the acceptable offer
made by the third party and upon the same terms and conditions as set
forth in the third party offer. DRA shall have 90 days following receipt
of such written notice of the third party offer in which to exercise its
option to purchase or lease, notice of which exercise by DRA shall be
given in writing to Greater Dubuque within said 90-day period.
If the acceptable offer to purchase or lease received by Greater
Dubuque from a third party that does not agree to operate said asset
subject to the terms and conditions of the Operating Agreement relates
only to the excursion gambling boat and its furnishings and equipment,
Greater Dubuque does not intend to obtain a substitute excursion gambling
boat, and DRA exercises its option to purchase said boat and its
furnishings and equipment under this paragraph, then
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DRA shall also have the right and option, at the same time, to purchase
Greater Dubuque's interest in the building. If the parties cannot reach an
agreement as to the fair market value of Greater Dubuque's interest in the
building, then one appraiser shall be chosen by Greater Dubuque and one
appraiser shall be chosen by DRA to value Greater Dubuque's interest in
the building. The two appraisers shall together determine the fair market
value of Greater Dubuque's interest in the building, which value shall be
the amount paid to Greater Dubuque if DRA exercises its option to
purchase. In the event the two appraisers cannot agree on a fair market
value; then they shall jointly choose a third appraiser whose decision as
to fair market value shall be binding. The cost of all appraisals shall be
paid 50% by DRA and 50% by Greater Dubuque.
"Acceptable offer" as used in this paragraph means an offer
acceptable to Greater Dubuque, in its sole and absolute discretion.
In the event DRA exercises its option to purchase or lease under the
terms of this paragraph 7, closing of the purchase or lease shall occur as
soon as possible and by no later than 90 days following exercise of DRA's
option unless a delay is caused by title problems which are corrected
within a reasonable period of time.
If DRA fails to exercise its option to purchase or lease within the
90-day period referred to above, then Greater Dubuque shall be free to
proceed with the proposed sale or lease to a third party upon the terms
set forth in the acceptable offer.
Pursuant to Article 19 of the lease agreement between Greater
Dubuque and Dubuque Community Investment Co., L.C., for the building,
Greater Dubuque has a right of first refusal to purchase the building
should Dubuque Community Investment Co., L.C., desire to sell the building
to a third party that does not agree to operate the building subject to
the terms and conditions of the Operating Agreement. Greater Dubuque
hereby agrees to exercise said right of first refusal should Dubuque
Community Investment Co., L.C., receive an acceptable offer to purchase
the building from a third party that does not agree to operate the
building subject to the terms and conditions of the operating Agreement.
Both parties acknowledge that any sale or assignment of lease made
pursuant to this paragraph may be subject to the approval of the Iowa
Racing and Gaming Commission.
In the event Greater Dubuque sells (subject to the foregoing
conditions and restrictions) the excursion
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gambling boat or any of its furnishings and equipment, whether during the
term of the Operating Agreement or thereafter, it is agreed that any
proceeds of sale shall first be applied to pay any and all obligations
owing by Greater Dubuque to DRA, whether or not referred to in the
Operating Agreement. Such obligations shall include, but not be limited
to, any amounts owing to DRA under paragraph 4 of the Operating Agreement
for any preceding period and for any unexpired term of the Operating
Agreement or for any unexpired term of any renewal period. All such
obligations owing by Greater Dubuque to DRA shall be paid from said
proceeds of sale prior to the making of any distributions, loans or
payments to investors or members of Greater Dubuque and also prior to the
repayment by Greater Dubuque of any loans or other obligations owing to
any investor, member or managing agent of Greater Dubuque.
DRA's right of first refusal and options under this paragraph shall
be effective only during the term of the Operating Agreement and any
renewal term as referred to in paragraph 1 herein and shall not be
effective following expiration of said term or renewal term. DRA's
exercise or non-exercise of its right of first refusal and options under
this paragraph shall not relieve Greater Dubuque from performing any
obligation which it is otherwise required to perform under the terms of
the Operating Agreement.
9. Paragraph 8(h) of the Operating Agreement is deleted and in lieu
thereof is substituted the following:
"(h) For any periods during which subparagraph 4(a)(4) of the Operating
Agreement is applicable, Greater Dubuque and DRA shall enter into a
non-exclusive joint marketing plan to conduct cooperative advertising and
marketing efforts. As part of and to facilitate said plan, the following
provisions apply:
(1) Greater Dubuque may elect to require that the posted overall
weighted average of theoretical payback percentage(4), determined in
accordance with paragraph 25.11(2)(b) of the Iowa Racing and Gaming
Commission regulations (491 IAC P. 25.11(2)(b)) on all DRA machine games
of chance shall not exceed by more than one-half of one percentage point
the posted overall weighted average of theoretical payback percentage on
all Greater Dubuque machine games of chance. If Greater
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(4) "Theoretical payback percentage" means the theoretical percentage of
coins which will be won by a player during a cycle of play on a machine.
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Dubuque makes such election, the following provisions shall apply:
(i) Greater Dubuque shall set its rates A) in good faith, B) in
accordance with reasonable commercial standards, and C) not for the
purpose of engaging in predatory pricing practices to the detriment
of DRA.
(ii) Greater Dubuque may not require DRA to change rates on its
machines more than four times per contract year.
(iii) Greater Dubuque shall give at least 30 days written notice of
any intended rate changes to DRA; Greater Dubuque shall provide to
DRA upon request the initial posted overall weighted average of
theoretical payback percentage on all Greater Dubuque machine games
of chance on the New Boat as defined in subparagraph 1(a)(1) of this
Ninth Amendment, and DRA may not be required to change its posted
weighted average of theoretical payback percentage on all DRA games
of chance until at least thirty days have elapsed after the
commencement of the operations of DRA's land-based casino or Greater
Dubuque's New Boat, whichever is later.
(iv) The parties shall implement the changes concurrently, and after
any required regulatory approvals.
This provision shall expire on the earlier of the following dates: (1) at
any time that Greater Dubuque shall commence operation of a New Boat as
defined in paragraph 1(a)(2) of this Ninth Amendment or a boat which is
not a New Boat, or (2) March 31, 2002.
(2) Greater Dubuque may elect to limit DRA from increasing, or seeking
approval to increase, the total number of machine games of chance in all
DRA casino operations to more than 600 slot machines before April 1, 2002;
in return for this right, Greater Dubuque shall not increase or seek
approval to increase, the number of machine games of chance in all Greater
Dubuque casino operations to more than 650 slot machines before April 1,
2002. This provision shall expire on the earlier of the following dates:
(1) at any time that Greater Dubuque shall commence operation of a New
Boat as defined in paragraph 1(a)(2) of this Ninth Amendment or a boat
which is not a New Boat, or (2) March 31, 2002.
(3) Greater Dubuque may elect to preclude DRA from installing table games
at any land-based casino
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operations of which DRA is the licensee, if such installation shall become
lawful under the laws of Iowa, before April 1, 2000. This provision shall
expire on the fifth anniversary of the approval of this Ninth Amendment by
the respective parties, or when Greater Dubuque shall commence operation
of a boat which is not a New Boat, whichever is earlier.
(4) This subparagraph 8(h) is subject to the express approval and
regulatory supervision of the Iowa Racing and Gaming Commission. The
parties shall submit reports annually (or more frequently, as the
Commission may require), to the Iowa Racing and Gaming Commission on the
administration of subparagraphs (l)-(5). Greater Dubuque shall hold
harmless and indemnify DRA from any liability arising by virtue of its
compliance with any elections made under this subparagraph 8(h). In the
event the Iowa Racing and Gaming Commission ceases to monitor party
compliance, or the number of or payout rate of gaming machines at licensed
gaming facilities, the provisions of subparagraphs (1)-(5) herein shall be
null and void and of no force or effect.
(5) Nothing herein shall prevent either party from conducting individual
advertising and marketing on said party's own behalf.
(6) This subparagraph 8(h) shall become null and void in its entirety if
Greater Dubuque or a corporation or business entity owned or controlled by
Greater Dubuque, its owners, or its successors or assigns, is the owner or
operator of any gambling operations in Dubuque County, Iowa, Xx Xxxxxxx
County, Illinois, or Grant County, Wisconsin, other than gambling
operations conducted on Greater Dubuque's excursion gambling riverboat
operating under this Operating Agreement; the circumstances under which
this subparagraph 8(h) shall become null and void include, but are not
limited to, Greater Dubuque's operation of any gambling operations at any
land-based facility or any non-excursion boat facility."
10. Paragraph 9 of the Operating Agreement is deleted.
11. Subparagraph 10(c) of the Operating Agreement is deleted and the
following substituted:
"(c) Copies of (i) all Weekly Adjusted Gross Revenue Tax/Tax Transmittal
Reports which are submitted to the Iowa Racing and Gaming Commission and
(ii) all weighted average theoretical payback percentage notices which are
required to be posted at land-based casinos and on excursion gambling
boats pursuant to Rule 25.11(2)(b) of the Iowa Racing and Gaming
Commission shall be exchanged weekly."
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12. Paragraph 11 of the Operating Agreement is amended by adding the
following as new subparagraphs (d) and (e):
"(d) DRA consents to and approves Greater Dubuque's application for the
New Boat submitted to the Iowa Racing and Gaming Commission on May 18,
1995; said consent is not a consent or approval of any future application
by Greater Dubuque to conduct additional gambling games or to replace
excursion gambling boats. DRA agrees that its consent is not required with
respect to Greater Dubuque's financing for the New Boat if the same is
approved by the Racing and Gaming Commission. Greater Dubuque agrees that
DRA's rights under the Operating Agreement are not and may not be
subordinated, waived, assigned, or affected in any manner by Greater
Dubuque's credit arrangements, unless by a separately signed instrument
approved by DRA's Board of Directors.
(e) DRA consents to any agreements entered into between Greater Dubuque
and the City of Dubuque regarding parking rights in the Ice Harbor
District for the benefit of the Portside facility, that do not conflict
with DRA's current lease of same."
13. Release, hold harmless, and indemnification: This Ninth Amendment to
the Operating Agreement shall constitute an accord and satisfaction of all
claims arising put of the parties' different interpretations of paragraph 5 of
the original Operating Agreement and any claims relating thereto. This Ninth
Amendment shall also constitute a full resolution of the matters currently
disputed between the parties in the matter submitted to the American Arbitration
Association as In the Matter of Greater Dubuque Riverboat Entertainment Company,
L.C. and Dubuque Racing Association, Ltd., AAA Case No. 57 104 0087 94, and
Greater Dubuque and DRA shall jointly request the dismissal of such arbitration
claim and shall share equally in the payment of any remaining fees owing to the
American Arbitration Association and/or the arbitrator in this matter, and
otherwise each side shall bear its own costs and attorneys fees in connection
with such proceeding.
DRA and Greater Dubuque hereby release and discharge each other from any
and all liability whatsoever, including all claims, demands, and causes of
action affecting either of them, which either may have or claim to have by
reason of or arising under the language of paragraph 5 of the Operating
Agreement as it existed prior to this Ninth Amendment. Greater Dubuque shall
defend, hold harmless, and indemnify DRA from and against any and all claims
against DRA caused by or arising under the original language of paragraph 5 of
the Operating Agreement (prior to this Amendment) or from the deletion of said
language by this Amendment, which are made by any officer, director, agent, unit
holder, partner (general or limited), manager, contractor, vendor, or supplier
of Greater Dubuque or by any party claiming
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rights by virtue of any contract with Greater Dubuque with respect to the
ownership, operation, control, financing, management, or sale of equipment to
land-based casino operations conducted by DRA. DRA shall defend, hold harmless,
and indemnify Greater, Dubuque from and against any and all claims against
Greater Dubuque caused by or arising under the original language of paragraph 5
of the Operating Agreement (prior to this Amendment) or from the deletion of
said language by this Amendment, which are made by any officer, director, agent,
unit holder, partner (general or limited), manager, contractor, vendor, or
supplier of DRA or by any party claiming rights by virtue of any contract with
DRA with respect to the ownership, operation, control, financing, management, or
sale of equipment to land-based casino operations conducted by DRA.
DRA and Greater Dubuque each execute this Ninth Amendment as a release and
a compromise settlement of disputed claims, liability for which is expressly
denied by each released party, and the resolution of these claims does not
constitute an admission of liability on the part of either entity. DRA and
Greater Dubuque each execute this release solely in reliance upon their own
respective knowledge, belief and judgment and not upon any representations made
by the other party.
14. Paragraph 13 is amended by adding the following additional
subparagraphs:
"(n) Nothing in the Operating Agreement shall preclude either party in
good faith from making any communication to, or taking any position
before, the Iowa Racing and Gaming Commission with respect to the
other party's current or future operations under the Operating
Agreement or changes thereto on matters not specifically consented
to in the Operating Agreement."
15. This Ninth Amendment to the Operating Agreement shall be effective
only if all of the following conditions are satisfied not later than August 21,
1995:
a. Approval on such conditions as the Iowa Racing and Gaming Commission
may require of DRA's application to conduct gambling games at the
Dubuque Greyhound Park by the Iowa Racing and Gaming Commission.
b. Approval of this Ninth Amendment to the Operating Agreement by the
Iowa Racing and Gaming Commission.
c. Final approval by the Iowa Racing and Gaming Commission of Greater
Dubuque's May 18, 1995 application to bring a new and substantially
larger gambling riverboat to Dubuque.
Both parties shall use their best efforts to secure their respective approvals,
and approval of this Ninth Amendment to the
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Operating Agreement, at the earliest practicable dates, from the Iowa Racing and
Gaming Commission.
If any of the foregoing conditions are not satisfied, this Ninth Amendment
to the Operating Agreement shall be null and void.
16. Operation by Greater Dubuque of any gambling operations other than on
an excursion gambling riverboat is not authorized under the Operating Agreement.
17. If any provision of this Ninth Amendment shall be declared by any
court or regulatory authority of competent jurisdiction to be illegal, void or
unenforceable, all other provisions of the Operating Agreement shall not be
affected and shall remain in full force and effect.
18. Each party shall provide the other a certified resolution approving
this Ninth Amendment upon execution thereof, and in any event not later than
August 4, 1995.
19. In subparagraph 4(b), the phrase "subparagraphs (a)(1), (a)(2), and
(a)(3)" is deleted and the phrase "subparagraph 4(a)" is substituted therefor.
Except as specifically amended above, all of the provisions of the
February 22, 1993 Operating Agreement and existing Amendments thereto shall
remain in full force and effect.
Dated this 11th day of July, 1995.
DUBUQUE RACING ASSOCIATION, LTD.
By /s/ Xxxxxxxx Xxxxxx
----------------------------------------
Xxxxxxxx Xxxxxx, President
By /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxx, Secretary
GREATER DUBUQUE RIVERBOAT
ENTERTAINMENT COMPANY, L.C.
By /s/ C Xxxxx
----------------------------------------
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JOINDER
[ILLEGIBLE] Community Investment Co., L.C., acknowledges receipt of
[ILLEGIBLE] of the foregoing instrument and joins in the Operating [ILLEGIBLE]
for the sole purpose of agreeing to the provisions of [ILLEGIBLE] 7 thereof as
amended by paragraph 8 of this Ninth [ILLEGIBLE]
DUBUQUE COMMUNITY INVESTMENT CO., L.C.
By /s/ Xxxxx Xxxxxxxx
----------------------------------------
Xxxxx Xxxxxxxx, Managing Member
