Exhibit 10.14
SIXTH AMENDMENT TO DEVELOPMENT AND LOAN AGREEMENT
BETWEEN
THE RIVER ROCK ENTERTAINMENT AUTHORITY,
AND
THE DRY CREEK RANCHERIA BAND OF POMO INDIANS
DRY CREEK CASINO, LLC
This Sixth Amendment to the Development and Loan Agreement ("Sixth
Amendment") is made and entered into this 7th day of November, 2003, by and
between the River Rock Entertainment Authority (the "Authority"), successor in
interest to, and an unincorporated tribal governmental instrumentality of, the
Dry Creek Rancheria Band of Pomo Indians, a federally recognized Indian tribe
(the "Tribe"), the Tribe and Dry Creek Casino, LLC, a Texas limited liability
company ("Developer" and, together with the Authority and the Tribe, the
"Parties"). Each capitalized term used in this Sixth Amendment and not otherwise
defined herein shall have the meaning ascribed to it in the Development and Loan
Agreement between the Tribe and Developer dated August 26, 2001 (the "Original
Agreement"), as amended by the Amendment to Development and Loan Agreement dated
April 29, 2002 (the "First Amendment"), as further amended by the Second
Amendment to Development and Loan Agreement dated February 19, 2003 (the "Second
Amendment"), as further amended by the Third Amendment to Development and Loan
Agreement dated May 29, 2003 (the "Third Amendment"), as further amended by the
Fourth Amendment to Development and Loan Agreement dated October 9, 2003 (the
"Fourth Amendment"), and as further amended by the Fifth Amendment to
Development and Loan Agreement dated October 9, 2003 (the "Fifth Amendment").
The First Amendment, Second Amendment, Third Amendment, Fourth Amendment and
Fifth Amendment are collectively referred to as the "Prior Amendments" and,
together with the Original Agreement, the "Agreement."
WHEREAS, the Tribe and Developer executed the Original Agreement on
August 26, 2001;
WHEREAS, subsequent to the execution of the Original Agreement, the
Tribe and Developer on five previous occasions determined that the Original
Agreement should be revised to reflect changed circumstances and executed the
Prior Amendments;
WHEREAS, the Tribe has created the Authority to operate the River Rock
Casino, in connection with the offering of the Authority's $200 million of 9.75%
senior notes due 2011 ("Senior Notes");
WHEREAS, the Tribe assigned to the Authority all of the Tribe's right,
title and interest in and to, among other things, the Project and the Agreement;
and
WHEREAS, the Authority and Developer have agreed to modify the terms of
the Agreement in order to clarify the priority of disbursements to be made by
the Authority to the Tribe, the Authority and Developer.
NOW THEREFORE, for good and valuable consideration the receipt
of which is hereby acknowledged, the Parties hereby agree to the following
amendments to the Agreement:
(1) The following definitions shall be added to the Agreement:
"Amended and Restated Limited Recourse Promissory Note" is the
limited recourse promissory note attached as Exhibit A to this Sixth
Amendment.
"Authority" means the River Rock Entertainment Authority, an
unincorporated tribal governmental instrumentality of the Tribe.
"Indenture" means the indenture dated even date herewith among
the Authority, the Tribe and the U.S. Bank National Association, as
Trustee with regard to the Senior Notes.
"Intercreditor Agreement" has the meaning ascribed to it in
the Amended and Restated Limited Recourse Promissory Note.
"Service Payment" has the meaning ascribed to it in the
Indenture.
"Sonoma Litigation" means the litigation styled as Sonoma
Falls Developers, LLC, et al. v. Dry Creek Rancheria Band of Pomo Indians, Case
No. CV 01-04125VRW and Sonoma Falls Developers, LLC, et al. v. Nevada Gold &
Casinos, Inc., et al., Case No. CGC-03-416610. The Sonoma Litigation shall
constitute a Third-Party Dispute.
(2) The term "Tribe" as used in the Agreement, as amended by this Sixth
Amendment, shall mean the "Authority" where the context so requires and the
Parties agree that the Authority shall be the successor in interest to the Tribe
under the Agreement in all respects.
(3) The last sentence of the first paragraph of the "Operating
Expenses" definition of the Agreement shall be deleted and replaced with the
following:
"For avoidance of doubt, "Operating Expenses" shall not include (a) the
repair and replacement reserve (or expenses) described in Section 2.11(e) of
this Agreement, (b) depreciation, (c) any expense which is incurred for some
purpose other than the generation of income or the maintenance or protection of
the Project, or (d) the interest expense on $25 million of the Senior Notes.
(4) Section 2.11 of the Agreement (including any amendments thereto
made in the Prior Amendments) shall be deleted and replaced with the following:
"Payment of Fees and Tribal Disbursement. Within fifteen (15)
days after the end of each calendar month of operations, the Authority
shall calculate Gross Revenues, Operating Expenses, Net Revenues of the
Project, and Available Cash Flow for the previous month's operations
and the year's operations to date. Except as otherwise required by the
Financing Documents, Net Revenues shall be disbursed by the Authority
to the extent authorized by the Indenture in the following order of
priority:
(a) the Permitted Payments;
(b) the Credit Enhancement Fee, subject to the terms of
the Intercreditor Agreement;
(c) the Service Payments to the extent allowed pursuant
to the Indenture;
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(d) principal payments on the Amended and Restated
Limited Recourse Promissory Note (all interest
payments on the Amended and Restated Limited Recourse
Promissory Note are considered Operating Expenses),
subject to the terms thereof and of the Intercreditor
Agreement and the Indenture; and
(e) a reasonable reserve for repairs and replacement of
Project building, furniture and equipment.
Notwithstanding the above, the Authority is not required to make any payments
hereunder if such payment would result in an Event of Default under the
Indenture or the Intercreditor Agreement; provided that any payments not made
due to such event will accrue and be paid immediately upon the curing of such
Event of Default. The priority of payments from available funds which is
described in this section does not control the calculation of the amount of each
of these obligations. The calculation of the amounts of these obligations shall
be as otherwise provided by this Agreement. The Authority agrees that it will
disburse all Net Revenues and pay all Operating Expenses in accordance with the
terms of this Agreement.
Upon the funding of the Senior Notes, all accrued but unpaid amounts due under
the Tribal Draw and Credit Enhancement Fee shall be paid in full. After such
funding date, if any amounts due under any of subsections (a)-(d) are accrued
but unpaid, all future distributions shall first be made to bring current all
priority payments."
(5) The last sentence of section 4.5 of the Agreement is deleted and
replaced as follows:
"Except as limited in the definition of "Operating Expenses," the
reasonable cost of defending a Third Party Dispute and any liability,
damages, demands, losses, costs or expenses incurred by Developer or
Tribe under this Section shall not be an Operating Expense and shall be
paid by the Authority from its share of Net Revenues when incurred."
(6) The following shall be added to the end of Section 4.5 of the
Agreement:
"The Indemnitees hereby acknowledge that upon: (a) the final settlement and
payment of all amounts required for the settlement of the Sonoma Litigation, and
(b) the payment to Indemnitees of $200,000 for costs associated with defending
against the Sonoma Litigation (the "Indemnification Event"), the Indemnitees
will not be entitled to the repayment of any other costs or expenses related to
the Sonoma Litigation.
For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and contingent upon the occurrence of the Indemnification
Event, the Developer does hereby forever and fully release and discharge the
Tribe and the Authority and each of their respective members, partners, agents,
attorneys, officers, directors, shareholders, employees, representatives,
affiliates, agencies, instrumentalities, commissions and commissioners,
predecessors, successors, assigns and heirs of and from any and all sums of
money, accounts, claims, rights, interests, demands, losses, including losses of
opportunity, contracts, actions of any kind whatsoever, debts, controversies,
agreements, and damages, of whatever kind or nature, known or unknown, suspected
or unsuspected, contingent or fixed, which the Developer now owns, holds or has,
or claims to own, hold or have, against the Tribe or the Authority, and any
future injuries not now known, or which may later develop or be discovered,
including the effects or consequences thereof and all causes of actions
therefor, arising out of or related to the Sonoma Litigation
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The Developer agrees that this release set forth in this Amendment shall apply
to all unknown or unanticipated results of the matters described hereinabove, as
well as those known and anticipated, and, upon advice of legal counsel, the
Developer does hereby waive and relinquish any and all rights and benefits
afforded under California Civil Code Section 1542, which section has been
explained to them and reads as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
(7) A new Section 7 is hereby added to the Agreement as follows:
"Section 7. The Authority hereby agrees to become a party to
this Agreement, to assume in their entirety all obligations of the
Tribe (as predecessor in interest to the Authority) under this
Agreement, and to effect all such obligations in the manner and
timeframes set forth in this Agreement. The Authority hereby waives its
sovereign immunity and any requirement of exhaustion of tribal remedies
to the same extent and in the same manner as the Tribe had waived its
sovereign immunity and any requirement of exhaustion of tribal remedies
as set forth in Sections 5.3 and 5.4. The Authority hereby expressly
agrees that nothing contained in this Agreement conflicts with any
terms of the Senior Notes."
(8) Miscellaneous.
(a) Authority. The Authority represents and warrants that it has taken
all action required by the Ordinance adopted by the Tribal Council of the Tribe
creating the Authority to authorize the execution, delivery and performance of
this Sixth Amendment. The Authority acknowledges that its entering into this
Sixth Amendment constitutes an Official Action as such term is defined in the
Ordinance establishing the Authority.
(b) Agreement Otherwise Not Affected. Except as expressly amended
hereby, the Agreement shall remain unchanged and in full force and effect
(including, without limitation, Sections 5.3 and 5.4 of the Agreement, which is
applicable to this Sixth Amendment) and is hereby ratified and confirmed in all
respects.
(c) Reference Within the Agreement. Each reference in the Agreement to
"this Agreement" and the words "hereof," "herein," "hereunder," or other words
of like import, shall mean and be a reference to the Agreement as amended by the
Prior Amendments and this Sixth Amendment. For the avoidance of doubt, this
shall include, without limitation, Sections 5.3 and 5.4 of the Agreement.
(d) Complete Agreement; Amendments. This Sixth Amendment together with
the Agreement and the Prior Amendments and any attachments thereto (including
the schedules, exhibits and annexes hereto and thereto), and the documents
delivered pursuant to the Agreement, the Prior Amendments and this Sixth
Amendment constitute the entire agreement and understanding among the parties
and supersede any prior written agreement and understanding relating to the
subject matter thereto. This Sixth Amendment may not be modified, amended or
otherwise altered except in accordance with the terms of the Agreement.
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(e) Reformation and Severability. In case any provision of this Sixth
Amendment shall be invalid, illegal, unenforceable, it shall, to the extent
possible, be modified in such manner as to be valid, legal, and enforceable but
so as to most nearly retain the intent of the parties, and if such modification
is not possible, such revision shall be severed from this Sixth Amendment and in
either case the validity, legality, and enforceability of the remaining
provisions of this Sixth Amendment shall not be in any way affected or impaired
hereby.
(f) Counterparts. This Sixth Amendment may be executed in counterparts,
each of which shall be deemed an original and all of which together shall
constitute but one and the same instrument.
(g) Additional Representations and Warranties.
(i) The Parties represent and warrant that no other party has
made any representations to such party concerning the matters addressed in the
Agreement and this Sixth Amendment, except as expressly set forth in such
documents.
(ii) The Parties represent and warrant that they have not
relied upon any statements not expressly set forth in the Agreement and this
Sixth Amendment, in entering into this Sixth Amendment.
(iii) The Parties represent and warrant that they have entered
into this Sixth Amendment on their own free will, without compulsion or duress,
and after consultation with their legal counsel.
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IN WITNESS WHEREOF, the parties have executed this Sixth Amendment as
of this 7th day of November, 2003, effective as of the date first written above.
RIVER ROCK ENTERTAINMENT AUTHORITY
By: /s/ Xxxxxxxxx Xxxxx XxXxxxx
-----------------------------------
Xxxxxxxxx Xxxxx XxXxxxx
Chairperson
THE DRY CREEK RANCHERIA BAND
OF POMO INDIANS, a federally-recognized
Indian tribe
By: /s/ Xxxxxxxxx Xxxxx XxXxxxx
------------------------------------
Xxxxxxxxx Xxxxx XxXxxxx
Chairperson
DRY CREEK CASINO, LLC, a Texas limited
liability company
By: /s/ H. Xxxxxx Xxxx
------------------------------------
H. Xxxxxx Xxxx
Manager
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