EXHIBIT 10.1
AMENDED AND RESTATED
EXCURSION BOAT SPONSORSHIP AND OPERATIONS AGREEMENT
THIS AMENDED AND RESTATED EXCURSION BOAT SPONSORSHIP AND OPERATIONS
AGREEMENT is made and entered into as of the 7th day of October, 2002, by and
between Iowa West Racing Association (hereinafter referred to as "Iowa West"),
an Iowa nonprofit corporation, and Ameristar Casino Council Bluffs, Inc.
(hereinafter referred to as "Ameristar"), an Iowa corporation.
WHEREAS, on September 15, 1994, Iowa West and Ameristar entered into
that certain Excursion Boat Sponsorship and Operations Agreement (the
"Sponsorship Agreement"); and
WHEREAS, paragraph 11 of the Sponsorship Agreement provides that the
initial term of the Sponsorship Agreement expires on December 31, 2002 and will
be automatically renewed unless either party gives at least six months' prior
notice of its intention not to renew the Sponsorship Agreement;
WHEREAS, on June 28, 2002, Ameristar gave written notice to Iowa West of
its intention not to renew the Sponsorship Agreement;
WHEREAS, the parties have since come to a mutual agreement for the
renewal of the Sponsorship Agreement on the terms set forth herein;
WHEREAS, paragraph 14 of the Sponsorship Agreement requires that any
amendment to or modification of the Sponsorship Agreement would only be
effective if it is in writing and signed by both parties, and, if required,
approved by the Iowa Racing and Gaming Commission (the "Commission"); and
WHEREAS, the parties do now wish to amend and restate in its entirety
the Sponsorship Agreement as hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, it is hereby mutually agreed as
follows:
1. LICENSE APPLICATION. Iowa West shall, each year, or as otherwise
required, promptly and timely apply to the Commission pursuant to Chapter 99F of
the Iowa Code as a sponsor for a license to conduct gambling games. Ameristar
shall, each year, or as otherwise required, promptly and timely apply to the
Commission for a license to operate an excursion gambling boat under Chapter 99F
of the Iowa Code.
2. CONDITIONS PRECEDENT TO SPONSORSHIP AND OPERATIONS AGREEMENT. This
Agreement shall be effective only upon the approval of this Agreement by the
Commission. The parties shall coordinate their efforts and cooperate with one
another to seek this approval as expeditiously as possible.
3. NON-ASSIGNABILITY OF LICENSES. Neither party may assign any of its
rights, duties or obligations under any license issued by the Commission without
the prior approval of the Commission.
4. LICENSE AGREEMENT AND OPERATION FEE.
(a) During the term of this Agreement, Ameristar shall pay to Iowa
West an operation fee determined in accordance with the following schedule:
(i) A fee of five percent (5%) of the Adjusted Gross Receipts
generated by the Ameristar excursion gambling boat shall be
applicable to the first Thirty Million Dollars ($30,000,000) of
Adjusted Gross Receipts generated by the Ameristar excursion gambling
boat each calendar year;
(ii)A fee of four percent (4%) of the Adjusted Gross Receipts
generated by the Ameristar excursion gambling boat shall be
applicable to such Adjusted Gross Receipts in excess of Thirty
Million Dollars ($30,000,000) up to and including Sixty Million
Dollars ($60,000,000) each calendar year;
(iii) A fee of three percent (3%) of the Adjusted Gross Receipts
generated by the Ameristar excursion gambling boat shall be
applicable to such Adjusted Gross Receipts in excess of Sixty Million
Dollars ($60,000,000) up to and including Ninety Million Dollars
($90,000,000) each calendar year;
(iv) A fee of two percent (2%) of the Adjusted Gross Receipts
generated by the Ameristar excursion gambling boat shall be
applicable to such Adjusted Gross Receipts in excess of Ninety
Million Dollars ($90,000,000) up to and including One Hundred Twenty
Million Dollars ($120,000,000) each calendar year; and
(v) A fee of one-half of one percent (0.5%) of the Adjusted Gross
Receipts generated by the Ameristar excursion gambling boat shall be
applicable to such Adjusted Gross Receipts in excess of One Hundred
Twenty Million Dollars ($120,000,000) up to and including One Hundred
Fifty Million Dollars ($150,000,000) each calendar year.
No fee shall be payable with respect to any Adjusted Gross Receipts generated by
the Ameristar excursion gambling boat in excess of One Hundred Fifty Million
Dollars ($150,000,000) each calendar year. The operation fee shall be paid
monthly on or before the 10th day of the month following the month in which the
Adjusted Gross Receipts were generated upon which such operation fee is based.
As used herein, the term "Adjusted Gross Receipts" shall have the same meaning
as set forth in Section 99F.1(1) of the Iowa Code.
(b) Ameristar shall be solely responsible for the payment of all
admission fees owing to the state and local governments under Section 99F.10 of
the Iowa Code or any
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succeeding provision, including admission fees relating to passengers with
complimentary passes. The parties agree that the fees set forth above are the
only sums to which Iowa West is entitled under this Agreement (other than
amounts payable pursuant to the indemnification provision set forth herein), and
all such fees paid to Iowa West are deemed and agreed to be subject to the
restrictions imposed by Section 99F.6(4)(a) of the Iowa Code or any succeeding
provision.
(c) Ameristar shall pay to the Commission all the wagering taxes
imposed by Section 99F.11 of the Iowa Code or any succeeding provision.
(d) Ameristar shall indemnify and hold Iowa West harmless from any
and all claims relating to all sums due for admission fees owing to any
government entity under Section 99F.10 of the Iowa Code or any succeeding
provision, all income or excise taxes owed to the United States or any state
government, and all wagering taxes owing to the State of Iowa under Section
99F.11 of the Iowa Code or any succeeding provision; provided, however, that
Ameristar shall have no liability or obligation to indemnify or hold Iowa West
harmless from any tax liability Iowa West may incur with respect to the monies
paid to Iowa West by Ameristar.
5. LICENSE APPLICATION FEES AND ATTORNEYS FEES. Each party hereto
shall be responsible for its own license fees and expenses in connection with
the approval and performance of this Agreement, and any application fee required
in connection therewith, including DCI investigation fees, and its own attorneys
fees in connection with this Agreement and the license applications contemplated
hereby.
6. IOWA WEST ORGANIZATIONAL AND GOVERNANCE REQUIREMENTS.
(a) REPRESENTATIONS OF IOWA WEST. Iowa West represents and warrants
to Ameristar that as of the date of this Agreement: each of Iowa West, the
Foundation (defined below) and Wescorp (defined below) is a nonprofit
corporation organized, existing and in good standing under the laws of the State
of Iowa; the articles of incorporation of each of Iowa West and the Foundation
respectively authorize only a single membership in each such corporation, and
Wescorp is the sole member of each of Iowa West and the Foundation.
(b) COVENANTS OF IOWA WEST. At all times during the term of this
Agreement following the Effective Date (as defined below), Iowa West agrees
that:
(i) Grant Committee. Iowa West Foundation (the "Foundation")
shall permit each operator of an excursion gambling boat or land-based
gaming facility for which Iowa West or an affiliate serves as the
qualified sponsoring organization (each, a "Sponsored Gaming Entity") to
appoint one (1) representative to the Foundation's Grant Committee
(being an advisory committee to the board of directors of the
Foundation); provided, however, that each person so appointed must, at
the time of appointment, have obtained the age of majority, must be a
permanent legal resident of Pottawattamie County, Iowa (the "County"),
and must be knowledgeable in matters concerning the City of Council
Bluffs, Iowa (the "City") and the County and the
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purposes of Iowa West and the Foundation's Grant Committee. All such
appointees must maintain continuing permanent residency in the County in
order to be eligible to continue to serve on such Committee. The
Foundation may refuse to seat any such appointee who, based upon the
reasonable and good faith determination of the Wescorp Board (as defined
below), does not meet such requirements and any such appointee who is
seated may be removed from the Committee if such residency is not
maintained. If such appointee is not seated or is removed, the Sponsored
Gaming Entity that appointed such unqualified or removed appointee,
shall have the right to designate a qualified replacement. The
Foundation's Grant Committee shall consist of the number of
representatives named by the Sponsored Gaming Entities, plus an
additional number of members equal to not less than 75% of the number of
directors of Wescorp and not more than 100% of the number of directors
of Wescorp. All members of the Foundation's Grant Committee, other than
the appointees of the Sponsored Gaming Entities, shall be members of the
Wescorp Board and shall be appointed by the Wescorp Board.
(ii) Wescorp Board of Directors.
(A) Prior to the Effective Date, Iowa Wescorp Association
("Wescorp") shall amend its bylaws to increase the size of its board of
directors (the "Wescorp Board") to seventeen (17) members, with the four
new members to be selected at Wescorp's 2003 Annual Meeting (which will
occur prior to February 1, 2003) (the "2003 Annual Meeting") as
described below for terms commencing on the date of the 2003 Annual
Meeting. Once a majority of the members of the Wescorp Board are
Nominated Directors (as defined below), Wescorp may amend its bylaws to
reduce the number of directors as and to the extent it deems such
reduction appropriate, provided that: (1) after such reduction, the
Wescorp Board shall continue to satisfy the requirement that a majority
of its members be Nominated Directors; and (2) the Wescorp Board shall
not be reduced below eleven (11) members.
(B) From the Effective Date until the expiration or
termination of this Agreement, selection of each member of the Wescorp
Board (including the re-election of sitting members eligible for
re-election) shall be made from a pool of nominees (the "Nominated
Pool") which will consist of:
(1) in the case of any board position for which a
sitting director is eligible for re-election, desires to be
re-elected, and is nominated by the Wescorp Board's nominating
committee, the sitting director, and
(2) a minimum of three nominees for each Wescorp Board
seat subject to election (or more nominees, if requested by
Wescorp) identified by each Nominating Body (which nominees may
include sitting directors eligible for re-election).
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It is understood that nominations are not specific to any particular
Wescorp Board seat in question. Any member of the Nominated Pool may be
elected to any seat on the Wescorp Board. As used herein, the term
"Nominating Body" or "Nominating Bodies" shall include the City Council
of the City, the Board of Supervisors of the County, the board of
directors of the Council Bluffs Chamber of Commerce, the Board of
Education of the Council Bluffs Community School District, and such
other governmental entities, civic and nonprofit organizations generally
representative of the broad-based constituencies within the greater
Council Bluffs/Pottawattamie County, Iowa community, if any, as may be
selected from time to time by the Wescorp Board (it being understood
and agreed that any nonprofit entity selected as a Nominating Body shall
be an established nonprofit organization with broad-based community
representation). Persons nominated by a Nominating Body who are selected
as directors of Wescorp (whether or not they are sitting directors
eligible for re-election) are hereinafter referred to as "Nominated
Directors." Any sitting director who is nominated for re-election by a
Nominating Body and is re-elected to the Board shall, from and after
such election and continuing for so long as such director thereafter
serves on the Board, be considered a Nominated Director, notwithstanding
the fact that such director was not a Nominated Director prior thereto.
All nominees must meet the minimum eligibility requirements for board
membership set forth in subparagraph 6(b)(ii)(D) hereof. In the event
that the Wescorp Board or its nominating committee reasonably and in
good faith determines that any nominee nominated by a Nominating Body
fails to meet such requirements, the Nominating Body which nominated
such nominee shall name a replacement nominee upon the request of
Wescorp. In the event that any Nominating Body shall fail or refuse to
nominate the number of nominees required under subparagraph (B)(2)
above, such failure shall not disqualify the remaining nominees (if any)
named by such Nominating Body or any other Nominating Body; provided,
that Wescorp may, at its option, request the remaining Nominating Bodies
to provide nominees to fill the pool of candidates to the required
number.
(C) Not later than February 1, 2003, the Wescorp Board shall
include not less than five (5) Nominated Directors. Not later than
February 1, 2005, the Wescorp Board shall include not less than seven
(7) Nominated Directors. Not later than February 1, 2007, and throughout
the remaining term of this Agreement, a majority of the members of the
Wescorp Board shall be Nominated Directors.
(D) It is understood and agreed that:
(1) the pool of nominees named by the Nominating Bodies
shall represent a diverse range of interests and points of view
within the greater Council Bluffs/Pottawattamie County, Iowa
community.
(2) the actual selection and terms of service of members
of the Wescorp Board shall be governed by the Articles of
Incorporation and Bylaws of Wescorp applicable thereto.
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(3) each nominee shall be a permanent legal resident of
the County, shall be of legal age, shall be generally familiar
with matters concerning the City, the County and the purposes of
Wescorp, shall be capable, in the reasonable and good faith
judgment of the Wescorp Board, of performing the duties of a
director, and shall meet such other uniformly applicable
eligibility requirements as may be established pursuant to the
bylaws of Wescorp.
(4) no nominee shall be an employee, officer or elected
official of any of the Nominating Bodies, any Sponsored Gaming
Entity, any formally-organized special interest group or any
formally-organized lobbying group; provided, however, that an
employee, officer or elected official of such a special interest
group or lobbying group shall be disqualified from the pool of
nominees only if the Wescorp Board reasonably and in good faith
determines that such nominee's role in or for such group involves
an actual or potential conflict of interest with the purposes of
Wescorp or the broad interests of the greater Council
Bluffs/Pottawattamie County, Iowa community.
(5) each nominee, if selected, shall agree that he or
she will be acting as a director in his or her capacity as a
citizen of the community and will not be acting as a
representative of the Nominating Body or Nominating Bodies by
whom he or she was nominated or of any other group or
organization.
(6) each nominee shall agree to submit to such
investigations as may be required in connection with any license,
findings of suitability or other approval required of Iowa West,
in each case as may be required under applicable provisions of
the Iowa Code or the rules and regulations of the Commission or
the Iowa Department of Public Safety (or its Division of Criminal
Investigation) in connection with such nominee's service on the
Wescorp Board or the board of directors of either Iowa West or
the Foundation, and any person who fails to satisfy these
requirements may be removed from the pool of nominees.
(7) at no time from the date of this Agreement
throughout the term of this Agreement shall Wescorp materially
amend in any substantive manner, without the prior written
consent of Ameristar or as otherwise permitted by this Agreement:
(A) Article V, Section 1 of its bylaws as it relates to the
length of terms of directors; (B) Article V, Section 2 of its
bylaws as it relates to limitations on terms of service of
directors; (C) Article V, Section 5 of its bylaws as it relates
to the required quorum for actions of the board of directors; (D)
Article V, Section 6 of its bylaws as it relates to the removal
of directors, or (E) Article V, Section 3 of its bylaws relating
to the establishment of eligibility requirements for Wescorp
Board membership. Iowa West represents and warrants that true,
correct and complete copies of each of such
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provisions have been given to Ameristar prior to its execution of
this Agreement.
(8) at no time from the date of this Agreement
throughout the term of this Agreement shall the Foundation: have
any member other than Wescorp; or amend its articles of
incorporation or bylaws or adopt any resolution to provide for
any member of the Foundation other than Wescorp, in each case
without the prior written consent of Ameristar or as otherwise
may be permitted by this Agreement.
(9) at no time from the date of this Agreement
throughout the term of this Agreement shall Iowa West: have any
member other than Wescorp; or amend its articles of incorporation
or bylaws or adopt any resolution to provide for any member of
Iowa West other than Wescorp, in each case without the prior
written consent of Ameristar or as otherwise may be permitted by
this Agreement.
(iii) Iowa West and Foundation Boards of Directors. From the
2003 Annual Meeting and continuing throughout the term of this
Agreement, the boards of directors of the Foundation and Iowa West,
respectively, shall consist of nine (9) members each selected from among
the members of the Wescorp Board. Overlap between members of the two
boards shall be minimized to the extent numerically possible (e.g., when
the Wescorp Board consists of seventeen (17) members and each of the
Foundation and Iowa West boards consist of nine (9) members, the two
boards shall have only one common board member). In the event that the
number of directors on the Wescorp Board is reduced as provided in
paragraph 6(b)(ii)(A) hereof, the number of members of the Iowa West and
Foundation boards may also be reduced to a number not less than one-half
of the number of members of the reduced Wescorp Board; provided that at
all times after the reduction of the size of the Wescorp Board, the
number of Wescorp Board members serving on both the Iowa West and
Foundation boards shall continue to be minimized to the extent
numerically possible. The number of Nominated Directors serving on each
of the boards of Iowa West and the Foundation shall, to the extent
numerically possible, be proportionate to the representation of the
Nominated Directors on the Wescorp Board; provided, however, that this
requirement shall not require any common member of both the Iowa West
and the Foundation boards to be a Nominated Director.
(iv) Public Relations Committee. Wescorp shall create a
Public Relations Committee whose membership shall consist of:
(A) One (1) member appointed by each Sponsored Gaming
Entity;
(B) One (1) member appointed by Iowa West; and
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(C) Two (2) "at-large" members selected and approved by the
Chairperson of Wescorp from nominees representative of the public
to be named by each of the Sponsored Gaming Entities.
The purpose of the Public Relations Committee shall be to advise the
boards of directors of Iowa West and Wescorp with respect to public
relations activities and affairs; provided, that the ultimate authority
for making decisions with respect to such matters shall reside in the
respective boards of directors of such entities. The Public Relations
Committee shall meet not less frequently than quarterly and may submit
written reports and recommendations to the Wescorp Board. The member
appointed by Iowa West shall serve as a liaison between the Wescorp
Board and the Public Relations Committee, and shall make oral reports to
the Wescorp Board from time to time as requested by the Public Relations
Committee. The Public Relations Committee shall have the opportunity to
meet with the Wescorp Board not less frequently than once per calendar
year.
(v) Delegation. Each of the Wescorp Board, the board of
directors of Iowa West and the board of directors of the Foundation may
delegate any of its respective authority to a committee of directors;
provided that such delegation is approved by not less than two-thirds of
the authorized and appointed directors of such entity; and provided
further that the following authority may not be delegated: the authority
of the Wescorp Board to appoint the directors of Iowa West or the
Foundation or the members of the Foundation's Grant Committee, or the
authority otherwise to exercise any rights of Wescorp acting in its
capacity as the member of either Iowa West or the Foundation. The number
of Nominated Directors serving on any such committee, other than the
executive committee of Wescorp, shall be proportionate, to the extent
numerically possible, to the representation of the Nominated Directors
on the Wescorp Board.
(vi) Inspection Rights. Wescorp, Iowa West and the
Foundation shall make their corporate records, including organizational
documents and minutes and written consents, available for inspection by
Ameristar or its counsel from time to time (but no more frequently than
annually) upon reasonable advance written notice from Ameristar solely
for the purpose of allowing Ameristar to determine compliance with the
provisions of this paragraph 6. Ameristar agrees that any such
inspection shall be on a strictly confidential basis; provided, however,
that such obligation of confidentiality shall not limit or restrict the
exercise by Ameristar of its rights under paragraph 6(c). Ameristar
agrees that any such inspection shall, if requested by Iowa West, be
conducted in the presence of a representative or representatives of Iowa
West.
(c) Default and Remedy. If there shall be any failure to comply
with any of the requirements of paragraph 6(b), Ameristar may give written
notice to Iowa West specifying with particularity the failure or failures to
comply. If all such specified failures are not remedied within sixty (60) days
following the giving of such notice, Ameristar may suspend making one-half of
the amount of each payment to Iowa West or its assignee under
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paragraph 4 of this Agreement and instead shall deposit the amount of such
suspended and withheld payments in a segregated interest-bearing escrow account
at the branch of a national or state chartered bank located in the County, until
such time as all such failures have been remedied or the termination of this
Agreement (it being understood that the remaining one-half of such fees shall
continue to be due and payable to Iowa West as provided herein). If all such
failures are cured prior to the giving by Ameristar of a notice of termination
(as provided for below), such escrowed funds, together with all interest earned
thereon, shall be released to Iowa West or its assignee. If all such specified
failures are not remedied within ninety (90) days following the giving of such
notice, Ameristar may give a written notice of termination of this Agreement to
Iowa West, which termination shall be effective on the last day of the sixth
(6th) month following the giving of the notice of termination or, if Iowa West
disputes the termination as provided below, the termination shall be effective
on the last day of the sixth (6th) month following the final determination by a
court of competent jurisdiction of Ameristar's right to terminate this
Agreement. In the event of such a termination of this Agreement while such funds
are held in escrow, all escrowed funds, together with all interest earned
thereon, shall be paid to the successor qualified sponsoring organization for
Ameristar's excursion gambling boat. If Iowa West disputes Ameristar's right to
terminate this Agreement under this paragraph and a court of competent
jurisdiction finally determines that Ameristar does not have a right to
terminate this Agreement under this paragraph, this Agreement shall continue in
full force and effect and all escrowed funds, together with all interest earned
thereon, shall be released to Iowa West or its assignee. In the event of such a
dispute, Iowa West agrees to assert its claim within thirty (30) days following
its receipt of the notice of termination from Ameristar, and both parties agree
to seek a trial date within ninety (90) days of the assertion of Iowa West's
dispute. As used in this Agreement, a determination by a court shall not become
final until the exhaustion or waiver by the losing party of all rights of
appeal.
7. TERM OF AGREEMENT.
(a) This Agreement shall become effective at 12:00:01 a.m. on January
1, 2003 (the "Effective Date") and shall terminate at 11:59:59 p.m. on March 31,
2010. Notwithstanding the foregoing, if the Commission changes its current
practice of issuing licenses for a one-year period from April 1 of a given year
to March 31 of the following year, the parties shall amend this Agreement to
provide for the expiration of this Agreement concurrently with the expiration
date of the licenses issued to Iowa West and Ameristar for the Ameristar
excursion gambling boat that is closest in time to the otherwise scheduled
expiration date of this Agreement. Until the Effective Date, the rights and
obligations of the parties to each other shall be governed exclusively by the
Sponsorship Agreement.
(b) Ameristar may terminate this Agreement upon six (6) months' prior
written notice to Iowa West if Iowa law is amended to no longer require
excursion gambling boats to operate under the sponsorship of a qualified
sponsoring organization.
(c) Iowa West agrees and acknowledges that, upon the termination of
this Agreement for any reason, whether upon the expiration without renewal of
this Agreement or
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otherwise, Iowa West shall, upon the written request of Ameristar, surrender to
the Commission (and all other government entities, if any) all licenses issued
by the Commission as contemplated by paragraph 1 (and all other licenses permits
and other approvals issued under the relevant provisions of the Iowa Code to
Iowa West to serve as the qualified sponsoring organization for the Ameristar
excursion gambling boat), which licenses, permits or other approvals, if any,
may be reissued to another qualified sponsoring organization without any
compensation to Iowa West from Ameristar, the State of Iowa or any other person
or entity, except for the compensation from Ameristar expressly provided for in
this Agreement. Nothing in this Agreement shall prohibit or restrict Ameristar
from entering into an agreement with another qualified sponsoring organization
for the sponsorship of the operations of the Ameristar gambling excursion boat
effective upon the expiration or termination of this Agreement for any reason.
Notwithstanding the foregoing, Iowa West shall not be required to take any
action or surrender any license, permit or other approval to the extent that the
failure to do so does not interfere with Ameristar's continuing operation of its
excursion gambling boat under the relevant provisions of the Iowa Code.
(d) In the event that this Agreement terminates or expires at a time
at which Ameristar would be forced to cease the operation of its excursion
gambling boat because it is not able immediately thereafter to operate its
excursion gambling boat under the license and sponsorship of another qualified
sponsoring organization, Ameristar shall have the option to extend the term of
this Agreement on a month-to-month basis for up to six (6) additional months
(provided, however, that Ameristar shall pay all costs associated with such
extension, including, without limitation, Iowa West's reasonable attorneys'
fees, together with all fees and costs associated with the extension or renewal
of Iowa West's license, if necessary). If Ameristar desires to exercise this
option, it shall give written notice to Iowa West at least ten (10) days prior
to the otherwise scheduled expiration or termination date. If Ameristar
exercises this option, it thereafter may terminate this Agreement as of the end
of any subsequent calendar month on not less than five (5) days prior written
notice to Iowa West.
8. HOLD HARMLESS AND INSURANCE REQUIREMENTS. During the term of this
Agreement, Ameristar shall indemnify, defend and hold harmless Iowa West,
Wescorp, the Foundation, and its and their officers, directors, employees, and
agents, from and against any and all liabilities, obligations, claims damages,
causes of action, cost and expenses imposed upon, incurred by, or asserted
against them by reason of all operations, whether insurable or not, for any
accident, injury to or death of persons, or loss of or damage to property
occurring on the excursion gambling boat. Ameristar further covenants and agrees
that it will at its own expense procure comprehensive public liability insurance
insuring both Ameristar and Iowa West in an amount not less than $5,000,000.00
single limit, subject to commercially reasonable deductibles or self-insured
retentions. Said liability insurance policy shall apply with respect to all
operations and functions of the excursion gambling boat that are insurable on a
commercially reasonable basis. A copy of policies of insurance protecting the
interests of Iowa West shall be forwarded directly to Iowa West.
9. NON-EXCLUSIVITY. It is understood that Iowa West has entered into or
may enter into sponsorship agreements with other parties for the conduct of
gambling games. Iowa
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West has provided a true, complete and correct copy to Ameristar of each such
agreement as in force on the date of this Agreement. Ameristar agrees to
consider all information therein as confidential, except to the extent such
information is otherwise publicly available or is required to be made public in
order to enforce Ameristar's rights hereunder. Iowa West further agrees that in
the event it agrees to any amendment or modification of the material economic
terms of the existing sponsorship agreement (the "Existing Harveys Agreement")
with Harveys Iowa Management, Inc. or an affiliate thereof or any assignee
thereof or an affiliate of any assignee thereof ("Harveys") prior to the
expiration or termination thereof in a manner that is more beneficial to Harveys
than the corresponding provisions of this Agreement, Iowa West shall notify
Ameristar in writing of such amendment or modification (which notice shall
include a copy of the amendment or modification). Ameristar shall have a period
of thirty (30) days after receipt of such notice in which to elect to enter into
the same amendment or modification with respect to the corresponding terms of
this Agreement. Ameristar's election shall be exercised by written notice
delivered to Iowa West and received by Iowa West within such thirty-day period.
As used herein, the "material economic terms" of the Existing Harveys Agreement
shall be deemed to be the provisions regarding the amount or rate of fees
payable by Harveys to Iowa West (whether denominated as operating fees or
otherwise) and the provisions regarding the term of the Existing Harveys
Agreement. If during the term of this Agreement the Commission determines that
the Pottawattamie County area is not able to support two excursion gambling
boats and one land-based gambling operation at Bluffs Run Greyhound Park (or
another location), Iowa West agrees that it will adopt a position of complete
neutrality with respect to which operations should be licensed under the
sponsorship of Iowa West.
10. IOWA WEST GAMING LICENSES/FINDINGS OF SUITABILITY IN OTHER
JURISDICTIONS. Iowa West acknowledges that Ameristar's parent company and other
current and future affiliates ("Ameristar Affiliates") possess and may obtain
additional privileged gaming licenses, findings of suitability and other
approvals (collectively, "Licenses") in various states in addition to the State
of Iowa. Pursuant to such Licenses, the Ameristar Affiliates are and will be
subject to statutes, regulations and investigative powers of agencies having
jurisdiction over gaming activities (the "Gaming Authorities"). The Ameristar
Affiliates from time to time may be required by the Gaming Authorities to report
and obtain approvals for this Agreement and the relationship of Ameristar with
Iowa West. Additionally, the Gaming Authorities are permitted to investigate
transactions in which Ameristar and the Ameristar Affiliates are engaged and may
call Iowa West and one or more of its affiliates forward for licensing, findings
of suitability and/or such other approvals as may be required by the Gaming
Authorities. Iowa West agrees to cooperate as reasonably requested in connection
with any investigation or other request by Gaming Authorities relating to such
required licenses, findings of suitability and other approvals; provided,
however, that Ameristar agrees to pay all reasonable costs and expenses in
connection with any such investigation or request. Notwithstanding the
foregoing, Ameristar shall not be obligated to pay the costs and expenses of any
investigation or other request made by the Commission, except to the extent that
such investigation or request is due to the acts or omissions of Ameristar.
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11. ASSIGNABILITY.
(a) Iowa West shall not have the right, power or authority to assign
all or any portion of this Agreement or its rights hereunder or to delegate any
duties or obligations arising under this Agreement voluntarily, involuntarily or
by operation of law, without Ameristar's prior written consent.
(b) Ameristar shall have the right, power and authority to assign
all or any portion of this Agreement or its rights hereunder or to delegate any
duties or obligations arising under this Agreement, voluntarily, involuntarily
or by operation of law, and without Iowa West's consent to any successor
operator of Ameristar's excursion gambling boat or to any financial institution
extending credit to Ameristar in the ordinary course of business, subject only
to Commission or other governmental approval, if required.
(c) Notwithstanding anything herein to the contrary, both parties
hereto expressly acknowledge that Iowa West may assign its rights to receive
payments hereunder to any affiliate of Iowa West, subject only to Commission
approval, if required; provided, however, that Iowa West shall remain liable for
all obligations imposed upon it under this Agreement.
12. AMENDMENT. This Agreement may be amended or modified at any time,
but only by a writing signed by both parties and, if required, approved by the
Commission.
13. GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Iowa and the rules and regulations of the Commission, and each party
shall be responsible for its own compliance with all laws of the State of Iowa
and the rules of the Commission.
14. REPORTS, ACCOUNTING AND AUDITING.
(a) Iowa West and Ameristar shall prepare and file all reports,
including financial reports, as required of each such party, respectively, by
Iowa law and the rules and regulations of the Commission. In addition, each
party shall keep such books and records and have audits performed as required of
it, respectively, by Iowa law and the Commission. Each party shall be
responsible for providing at its own expense all audit and accounting services
for any reports and audits required by the Commission.
(b) Each party agrees that the Commission and the other party to
this Agreement shall have the right to audit such party's records to the extent
necessary to provide verification of compliance under this Agreement. In the
event the Commission or either party determines that a party is not in
compliance with the terms of this Agreement, then in addition to all other
remedies provided for by law, each party shall have the right to specifically
enforce the terms and provisions of this Agreement. As between the parties to
this Agreement, the party requesting such audit shall provide reasonable advance
notice in writing of such request, and such audit shall be conducted at
reasonable times and in the presence of a representative of the party being
audited.
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15. DEFAULT.
(a) The occurrence of any one or more of the following events shall
constitute a default by a party hereunder:
(i) Failure of the party to perform or comply in any material
respect with any of the material duties and obligations imposed upon
said party under the terms of this Agreement.
(ii) The suspension or revocation of the party's license under
Chapter 99F of the Iowa Code by the State of Iowa or the Commission.
(iii) (A) If a party shall generally not pay its debts as they
become due, or shall admit in writing its inability to pay its debts, or
shall make a general assignment for the benefit of creditors; (B) if a
party shall commence any case, proceeding or other action seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or seeking appointment
of a receiver, trustee, custodian or other similar official or
representative for it or for all or any substantial part of its
property; (C) if a party shall take any corporate or other action to
authorize any of the actions set forth in clause (A) or (B) above; or
(D) if any case, proceeding or other action against a party is commenced
seeking to have an order for relief entered against it as a debtor, or
seeking reorganization, arrangement, adjustment, liquidation,
dissolution or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking
appointment of a receiver, trustee, custodian or other similar official
or representative for it or for all or any substantial part of its
property, and such case, proceeding or action (x) results in the entry
of an order for relief against it which is not fully stayed within
thirty (30) days after the entry thereof or (y) remains undismissed for
a period of ninety (90) or more consecutive days.
(b) Except as otherwise provided in this paragraph 15, (x) if one of
the acts of default described in clauses (a)(i) and (ii) occurs and is not
remedied by the defaulting party within thirty (30) days after the giving of
written notice by the non-defaulting party of said default or (y) if one of the
acts of default described in clause (a)(iii) occurs, then the non-defaulting
party shall have the right to terminate this Agreement in addition to all rights
and remedies provided at law or in equity, including without limitation specific
performance or injunctive relief.
(c) If a default by Iowa West occurs that results in the suspension
of gambling on the Ameristar excursion gambling boat or the suspension or
revocation of any License held by any Ameristar Affiliate, and such suspension
would not have been ordered but for the default by Iowa West hereunder,
Ameristar will have available to it immediately the right to terminate this
Agreement in addition to all rights and remedies provided at law or in equity,
including without limitation specific performance or injunctive relief.
Notwithstanding any
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provision hereof to the contrary, Ameristar shall not be required to submit to
non-binding mediation prior to exercising its right of termination under this
clause (c).
(d) Notwithstanding any other provision of this Agreement to the
contrary, paragraph 6(c) sets forth the exclusive remedy of Ameristar in the
event of a default under paragraph 6(b).
(e) Except as otherwise provided herein, the remedies of the
non-defaulting party shall be cumulative, and the exercise of any one or more
remedies shall not be construed as a waiver of any other remedies. Further, no
course of dealing between the parties or failure on the part of a non-defaulting
party to exercise any right or remedy shall operate as a waiver of such right to
claim a default in the future.
16. NON-BINDING MEDIATION OF DISPUTES. Each party agrees to enter into
non-binding mediation at the request of the other with respect to any dispute
arising under this Agreement upon the giving by Ameristar of a notice of
non-compliance under paragraph 6(c) or upon the giving of a notice of default by
a party under paragraph 15(a)(i). In the case of mediation of a dispute under
paragraph 6(c), Ameristar shall not be required to engage in mediation for more
than forty-five (45) days following the giving by Ameristar of the notice of
non-compliance under paragraph 6(c), and in the case of mediation of a dispute
under paragraph 15(a)(i), the party that gives the notice of default shall not
be obligated to engage in mediation for more than thirty (30) days following its
giving of notice of default. Any such mediation shall be conducted on a
confidential basis with a single mediator selected by the mutual agreement of
the parties, or by the American Arbitration Association if the parties are
unable to agree upon a mediator.
17. MISCELLANEOUS PROVISIONS.
(a) NOTICES. All notices, request, demands and other communications
hereunder shall be deemed to have been given if delivered in person or if sent
by certified mail, postage prepaid, or by fax, or by reputable overnight courier
service, to the other party at the following addresses:
To Iowa West: Iowa West Racing Association
Attention: Executive Director
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
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With duplicate to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ Law Firm, P.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
To Ameristar: Ameristar Casino Council Bluffs, Inc.
c/o Ameristar Casinos, Inc.
Attention: President and CEO
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address or such other person as a party shall have last
designated by notice to the other party. All notices shall be deemed to be given
when received. All notices given by fax shall be confirmed by the delivery of a
copy thereof by another permitted means of delivery, provided that such notice
shall be deemed to have been given when received by fax.
(b) RELATIONSHIP OF PARTIES. Nothing in this Agreement shall be
construed to create a partnership between the parties, a relationship of
employer and employee between the parties, or a relationship of principal and
agent between the parties.
(c) AUTHORIZATION. Each party represents and warrants to the other
that this Agreement has been duly authorized on its behalf and that this
Agreement is the valid, binding and enforceable agreement of such party.
(d) NONPROFIT AND TAX EXEMPT STATUS. Notwithstanding any provision
of this Agreement to the contrary, it is understood and agreed that if, in the
opinion of counsel to Iowa West (such counsel to be competent in matters
concerning tax-exempt organizations and related matters), any change in law or
regulation (whether by statute, regulation, judicial ruling, administrative
ruling or otherwise) enacted, adopted or promulgated following the date of this
Agreement prohibits or restricts the ability of Iowa West, Wescorp or the
Foundation to (i) comply with any of its obligations under paragraph 6(b) and
(ii) satisfy applicable requirements for the maintenance of its status as (A) an
Iowa nonprofit corporation, and (B) a corporation which is exempt from federal
income taxation as an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended (the "Code"), and (C) an organization
that is not a private foundation in accordance with Section 509(a) of the Code,
then the parties shall meet and confer in good faith to consider amending this
Agreement to preserve the status of Iowa West, Wescorp and
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the Foundation while at the same time materially maintaining the protections
provided for in paragraph 6(b). If both such objectives cannot be achieved
through a mutually acceptable amendment, then Iowa West, Wescorp and the
Foundation shall not be required to comply with paragraph 6(b) to the extent
necessary to maintain their respective statuses described above, but Ameristar
may, at its option, terminate this Agreement on not less than six (6) months
written notice to Iowa West. If requested by Ameristar, the opinion of counsel
to Iowa West shall be a written opinion addressed jointly to Iowa West and
Ameristar.
(e) SUCCESSORS AND ASSIGNS. This Agreement, and all of the
obligations, duties and rights of the parties hereunder shall inure to and be
binding upon the heirs, successors and permitted assigns of the parties.
(f) COMPLETE AGREEMENT. Subject to the last sentence of paragraph
7(a) of this Agreement, this Agreement embodies the entire agreement between the
parties and supersedes all prior oral and written proposals and communications.
(g) COUNTERPARTS. This Agreement may be executed in multiple
counterparts, and if so executed, each such counterpart is deemed an original
for all purposes, and all such counterparts shall collectively constitute one
agreement.
(h) TIME IS OF THE ESSENCE. Time is of the essence in the
performance of this Agreement and each and every provision contained herein.
(i) CONSTRUCTION. This Agreement shall be construed to comply with
all applicable Iowa laws, Commission rules and regulations relating to excursion
boat gambling, and may be amended from time to time in order to comply with such
laws, Commission rules and regulations; provided, however, that no such
amendment shall materially and adversely affect the rights and obligations of a
party without such party's written consent.
(j) HEADINGS. Paragraph headings herein are for reference purposes
only.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written at Council Bluffs, Iowa.
IOWA WEST RACING ASSOCIATION AMERISTAR CASINO COUNCIL BLUFFS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------- ---------------------------------
President Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Vice President
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