Exhibit 10.4
EXPENSE REIMBURSEMENT/SHARING AGREEMENT
THIS EXPENSE REIMBURSEMENT/SHARING AGREEMENT ("Agreement") is
executed as of this 22nd day of October 2001, by and between The Majestic Star
Casino, LLC, an Indiana limited liability company ("Majestic Star"), and
Majestic Investor Holdings, LLC, a Delaware limited liability company ("Majestic
Investor Holdings").
W I T N E S S E T H:
WHEREAS, Majestic Star employs certain executives and other
employees, and desires to pay Employee Expenses (as defined below) on the terms
and conditions set forth herein; and
WHEREAS, Majestic Star and Majestic Investor Holdings desire
to memorialize their agreement with respect to the payment and reimbursement of
Employee Expenses;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein set forth, the parties do hereby agree as
follows:
1. Majestic Star agrees to pay all costs and expenses of
executives and certain other employees agreed to by the parties, including, but
not limited to, salaries, bonuses, benefit payments, insurance, supplies,
certain cost savings resulting from synergies and such other costs and expenses
listed on Exhibit A (collectively, "Employee Expenses"). All Employee Expenses
shall be itemized on Exhibit A and shall set forth the actual or estimated costs
of each item. The parties may amend Exhibit A in accordance with the following
procedures on a monthly basis. Majestic Star shall send to Majestic Investor
Holdings the proposed amendment, which shall also set forth a proposed effective
date. Majestic Investor Holdings shall have three (3) business days to object to
such proposed amendment, and in the event that there is no objection, the
proposed amendment shall be effective on the effective date set forth therein.
In the event that Majestic Investor Holdings shall object, the parties shall
negotiate in good faith to reach an agreement with respect to such amendment. In
the event that no agreement is reached, (i) the parties may continue this
Agreement without the proposed amendment or (ii) either party may terminate this
Agreement upon fifteen (15) days prior written notice.
2. Majestic Investor Holdings agrees to reimburse Majestic
Star for 60% (the "Reimbursement Percentage") of all Employee Expenses paid by
Majestic Star (the "Reimbursement Payment"). Such Reimbursement Payment shall be
paid to Majestic Star on or prior to the first day of each month. In the event
such Reimbursement Payment is not paid to Majestic Star by such date, Majestic
Star may charge Majestic Investor Holdings a late payment equal to 1.5% of the
late Reimbursement Payment and interest thereon at an annualized rate of 10% per
annum. The parties may modify the Reimbursement Percentage from time to time in
accordance with the following procedures: (i) a party may request modification
to the Reimbursement Percentage upon at least three (3) days prior written
notice to the other party; (ii) during such three-day period, (A) the other
party may agree to such modification (whereby the modification shall become
effective as of the date set forth in the notice) or (B) the other party may
refuse to agree to such modification (whereby the modification shall not be
effective and the parties shall negotiate in good faith as to a different
modification, which shall become effective if and when an agreement is reached);
and (iii) in the event there is no response from the other party within the
three day period described above, the proposed modification shall become
effective as of the date set forth in the notice.
3. Upon request, Majestic Star shall provide Majestic Investor
Holdings access to any and all records reasonably related to Executive Expenses
paid by Majestic Star and partially reimbursed by Majestic Investor Holdings
pursuant to this Agreement.
4. Subject to Section 1, this Agreement may be terminated by
either party upon thirty (30) days prior written notice.
5. (a) This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof. This
Agreement may not be modified, waived, terminated or amended, except expressly
by an instrument in writing signed by the parties hereto.
(b) This Agreement may be assigned or pledged in
whole or in part by a party with the consent of the other parties.
(c) In the event that any provision of this Agreement
shall be held to be void or unenforceable in whole or in part, the remaining
provisions of this Agreement and the remaining portion of any provision held
void or unenforceable in part shall continue in full force and effect.
(d) Except as otherwise specifically provided herein,
notice given hereunder shall be deemed sufficient if delivered personally or
sent by registered or certified mail to the address of the party for whom
intended at the principal executive offices of such party, or at such other
address as such party may hereinafter specify by written notice to the other
party.
(e) No waiver by any party of any breach of any
provision of this Agreement shall be deemed a continuing waiver or a waiver of
any preceding or succeeding breach of such provision or of any other provision
herein contained.
(f) This Agreement shall be governed by and construed
in accordance with the laws of the State of Indiana.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
THE MAJESTIC STAR CASINO, LLC
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
Chief Operating and Financial Officer
MAJESTIC INVESTOR HOLDINGS, LLC
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Xxxxxxx X. Xxxxx, Manager
By: /s/ Xxx X. Xxxxxx
-------------------------------------
Xxx X. Xxxxxx, Manager
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EXHIBIT A
Estimated $2.7 million for the direct payroll and payroll related for the
following positions and their respective support staffs:
CEO V.P. Legal
COO Corp. M.I.S.
CFO Corp. Internal Audit
Corp. Compliance
Corp. H.R.
Corp. Marketing
Estimated $700,000 for operating expenses of the aforementioned personnel
including supplies, postage, printing, telephone, travel, licensing, meals,
dues, subscriptions, as well as other general operating expenses.
