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Exhibit 10.14
JOINT VENTURE AGREEMENT
OF
TABLE MOUNTAIN DEVELOPMENT GROUP
THIS JOINT VENTURE AGREEMENT ("Agreement") is made and entered into as
of the 1 day of Feb., 1996, by and between American Casino Enterprises, Inc., a
Nevada corporation (hereafter "ACES") and Table Mountain Rancheria, a federally
recognized Indian tribe (hereafter "Table Mountain"), as Joint-Venturers.
ARTICLE I
Formation
1.1 Formation. The parties hereto hereby from the Joint Venture in
accordance with the terms and conditions of this Agreement.
1.2 Intent. It is the intent of the Joint-Venturers that the Joint
Venture be operated in a manner consistent with its treatment as a "partnership"
for federal and state income tax purposes. No Joint Venturer shall take any
action inconsistent with the express intent of the parties hereto as set forth
herein.
1.3 Definitions. Capitalized terms as used in this Agreement are
defined in Article XII herein.
ARTICLE II
General Provisions
2.1 Name. The name of the Joint Venture shall be "Table Mountain
Development Group."
2.2 Principal Office and Place of Business. The Principal Office
and place of business of the Joint Venture shall be located at the Table
Mountain Casino, P. O. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other place as
the Joint-Venturers from time to time shall agree.
2.3 Joint Venture Purposes. The purpose of the Joint Venture is to
provide consulting and related services to American Indian tribes or tribal
entities concerning the planning, development, financing, construction and
operation of tribal gaming facilities and other economic development projects.
The Joint Venture shall have the power to do any and all acts and things
necessary appropriate, proper, advisable, incidental to or convenient for
furtherance and accomplishment of such purpose, including, but not limited to
the entering into or acquiring of any proprietorships, partnerships, joint
ventures, corporations, limited liability companies, or other similar entities
or arrangements to engage in any of the foregoing. The Joint Venture may engage
in other business only upon the unanimous vote of the Joint-Venturers
2.4 Term. The term of the Joint Venture shall commence on the date
of this Agreement and shall continue until the liquidation and\or winding-up of
the Joint Venture in accordance with Section 10.1 of this Agreement.
2.5 Payment of Individual Obligations. The Joint Venture's credit
and assets shall be used solely for the benefit of the Joint Venture, and no
asset of the Joint Venture shall be transferred or encumbered for or in payment
of any individual obligation of a Joint-Venturer.
2.6 Title to Property. All real and personal property owned by the
Joint Venture shall be owned by the Joint Venture as an entity and no
Joint-Venturer shall have any ownership interest in such property in its
individual name or right, and each Joint-Venturer's interest in the Joint
Venture shall be personal property for all purposes. Except as otherwise
provided in this Agreement, the Joint Venture shall hold all of its real and
personal property in the name of the Joint Venture and not in the name of any
Joint-Venturer.
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ARTICLE III
Capital Contributions
3.1 Capital Contributions. Each Joint-Venturer hereby agrees to
contribute a Capital Contribution as described on Exhibit A hereto.
3.2 Additional Capital Contributions. Additional Capital
Contributions shall only be made upon the unanimous consent of the
Joint-Venturers.
3.3 Joint-Venturer Loans.
(a) General. A loan to the Joint Venture by a Joint
Venturer(a "Joint Venturer Loan") shall only be made upon the unanimous consent
of the Joint-Venturers.
(b) Terms of Joint-Venturer Loans. Unless the
Joint-Venturers otherwise agree, all Joint-Venturer Loans shall bear interest at
the Prime Rate plus one and one half percent (1.5%), shall compound
semi-annually (as of the last day of each successive six month period occurring
thereafter), shall be fully recourse to the Joint Venture and to each
Joint-Venturer, shall be repayable in whole or in part without penalty subject
to the requirements of Section 3.3(c) below, and shall be an unsecured payment
right in favor of the payee which may be transferred only together with a
transfer by such payee of its interest as a Joint-Venturer as permitted by this
Agreement.
(c) Repayment. Unless the Joint-Venturers otherwise agree,
all Joint Venturer Loans must be repaid in full out of available funds of the
Joint Venture before any distribution may be made to any Joint-Venturer under
Article IV. Joint-Venturer Loans shall be repaid in the same order in which they
were made. All payments received with respect to a Joint-Venturer Loan shall be
applied first against accrued and unpaid interest thereunder, and then against
the outstanding principal balance thereof. If more than one Joint-Venturer
joined in the making of a Joint-Venturer Loan, the Joint Venture shall make
payments thereunder to the Joint-Venturers in proportion to the amount of
principal each advanced.
ARTICLE IV
Distributions
4.1 Amount and Time of Distributions. Distributions of available
cash to the Joint-Venturers and payments on respective Joint-Venturer Loans
shall be made only at such times as the Joint-Venturers shall reasonably
determine and only in such amounts over and above such reserves as are
sufficient to enable the Joint Venture to meet its existing and reasonably
anticipated financial obligations.
4.2 Distributions to Joint-Venturers. After the repayment of all
Joint-Venturer Loans, distributions of remaining available cash shall be made to
the Joint-Venturers pro rata in accordance with their Participating Percentages,
as set forth on Exhibit B hereto. The Participating Percentages of the
Joint-Venturers may be changed from time to time, or may vary from transaction
to transaction, upon the unanimous consent of the Joint-Venturers. In the event
the Participating Percentage of a Joint Venturer is to be increased with respect
to a particular transaction, that Joint Venturer shall be required to make a
corresponding increase in its Capital Contribution relative to that transaction.
4.3 Distribution Upon Withdrawal. No withdrawing Joint-Venturer
shall be entitled to receive any distribution or the value of such
Joint-Venturer's Interest in the Joint Venture as a result of withdrawal from
the Joint Venture prior to the liquidation of the Joint Venture, except as
specifically provided in this Agreement.
4.4 Return of Capital. No Joint-Venturer shall be entitled to the
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return of, or interest on, that Joint-Venturer's Capital Contributions except as
provided herein.
ARTICLE V
Allocations
5.1 Economic Allocations of Profit and Loss. Profits and Losses
for each Fiscal Year shall be allocated to the Joint-Venturers, pro rata based
on their Participating Percentages.
5.2 Special Tax Allocations.
(a) Nonrecourse Deductions. The allocations set forth in
Section 5.1 are intended generally to comply with requirements of Regulations
sections 1.704-1(b) and 1.704-2. If the Joint Venture incurs "nonrecourse
deductions" or "partner nonrecourse deductions" or if there is any change in the
Joint Venture's "minimum gain," as those terms are defined in such Regulations,
the allocation of Profits, Losses and items thereof to the Joint-Venturers shall
be modified as deemed reasonably necessary or advisable by the Joint-Venturers
to comply with such Regulations.
(b) Built-in Gain Allocation. If necessary or required
under Code section 704(c) or Treasury Regulation section 1.704-1 (b)(2)(iv)(f),
the Joint-Venturers shall make special tax allocations in order to account for
the variation, if any, between the adjusted tax basis of an asset and its Gross
Asset Value. Any elections or decisions relating to the allocations under this
Section 5.2(b) shall be made by the Joint-Venturers in any manner that
reasonably reflects the purpose and intention of this Agreement. Allocations
pursuant to this Section 5.2(b) are solely for purposes of federal, state and
local taxes and shall not affect or in any way be taken into account in
computing any Joint-Venturer's Capital Account or share of Profits, Losses,
other items or distributions pursuant to any provision of this Agreement.
ARTICLE VI
Management
6.1 General. The Joint-Venturers shall devote such time and effort
as is necessary for the management of the Joint Venture in the conduct of its
business but shall not be required to devote their full-time efforts to the
Joint Venture. Each Joint-Venturer at all times shall keep the other
Joint-Venturers fully informed as to all such Joint-Venturers' activities on
behalf of the Joint Venture and all material transactions taken on behalf of the
Joint Venture and shall disclose to the Joint Venturers such Joint-Venturer's
knowledge of the Joint Venture's business and affairs. Except as otherwise
specifically provided in this Agreement, (a) each Joint-Venturer shall have a
right and voice in the management and operation of the Joint Venture and (b) all
material matters relating to the conduct of the business and affairs of the
Joint Venture including all decisions, consents, actions and votes required by
this Agreement to be made by "the Joint-Venturers" shall be determined by the
unanimous consent of the Joint Venturers.
6.2 Joint-Venturer Authority. Except as specifically provided by
this Agreement or pursuant to a writing signed by those Joint-Venturers
constituting the requisite vote, no Joint Venturer is authorized and empowered
to execute, deliver or perform any material agreements, acts, transactions or
matters contemplated in this Agreement on behalf of the Joint Venture as agent
for the Joint Venture, notwithstanding any applicable law, rule or regulations.
6.3 Administrative Joint-Venturer. The Joint-Venturers acknowledge
certain day to-day activities and administrative acts may be required to be
undertaken or performed. Accordingly, for this purpose, ACES is hereby
designated the "Administrative Joint-Venturer" for the Joint Venture, which
shall have only the specific powers and authorities granted by this Agreement or
by the Joint-Venturers in writing.
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6.4 Execution of Documents. Each Joint-Venturer shall have the
power to execute instruments and documents and otherwise bind the Joint Venture
in all matters relating to the business of the Joint Venture which are
authorized or approved in accordance with the terms of this Agreement or
otherwise by the Joint-Venturers in writing.
6.5 Banking Resolution. The Joint-Venturers hereby unanimously
authorize the Administrative Joint-Venturer to open one or more banking accounts
as the Joint-Venturers deem necessary and to enter into any deposit agreements
as are required by the financial institution at which such accounts are opened.
The deposit agreements shall require that checks drawn on or withdrawals from
such Joint Venture accounts shall require a signature by a representative of
each Joint Venturer. Funds deposited into such accounts shall be used only for
the business of the Joint Venturer.
6.6 Filing of Documents. The Joint-Venturers shall file or cause
to be filed all certificates or documents as the Joint-Venturers may determine
to be necessary or appropriate for the formation, continuation, qualification
and operation of the Joint Venture.
6.7 Indemnification and Liability.
(a) Joint-Venturer Indemnification. Each Joint-Venturer
shall be indemnified, defended and held harmless by each other Joint-Venturer
(the "Indemnifying Joint Venturer") from and against any and all losses, claims,
damages, liabilities, expenses (including attorneys' fees and costs), judgments,
fines, settlements, demands, actions, or suits relating to or arising out of any
claim, issue or matter except: (i) in respect of which such Indemnifying Joint
Venturer or any of its agents, employees or other representatives (or the Joint
Venture as the result of an act or omission of any of the same) has been
adjudged liable for fraud, negligence or willful misconduct; or (ii) based upon
or relating to a material breach by the Indemnifying Joint-Venturer of any term
or provision of this Agreement.
(b) Liability. No Joint-Venturer shall be liable,
responsible, accountable in damages or otherwise to the Joint Venture or the
Joint-Venturers for any act or failure to act in connection with the Joint
Venture and its business unless the act or omission is attributed to negligence,
willful misconduct or fraud or constitutes a material breach by such
Joint-Venturer of any term or provision of this Agreement.
(c) Terms of Indemnification. Each indemnity provided for
under this Agreement shall be subject to the following provisions:
(i) The indemnity shall cover the costs and
expenses of the indemnitee, including reasonable attorneys' fees and court
costs, related to any actions, suits or judgments incident to any of the matters
covered by such indemnity.
(ii) The indemnitee shall notify the indemnitor of
any claim against the indemnitee covered by the indemnity within 45 days after
the indemnitee has notice of such claim, but failure to notify the indemnitor
shall in no case prejudice the rights of the indemnitee under this Agreement
unless the indemnitor shall be prejudiced by such failure and then only to the
extent the indemnitor shall be prejudiced by such failure. Should the indemnitor
fail to discharge or undertake to defend the indemnitee against such liability
upon learning of the same, then the indemnitee may settle such liability, and
the liability of the indemnitor hereunder shall be conclusively established by
such settlement, which amount of such liability shall include both the
settlement consideration and the reasonable costs and expenses, including
attorneys' fees, incurred by the indemnitee in effecting such settlement.
(iii) No indemnity hereunder shall be construed to
limit or diminish the coverage of any Joint-Venturer under any insurance
obtained
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by the Joint Venture. Payment shall not be a condition precedent to any
indemnification provided in this Agreement.
6.8 Fiduciary Duties. Each Joint-Venturer acknowledges and agrees
that each Joint-Venturer shall be accountable to the Joint Venture and the other
Joint-Venturers as a fiduciary, and, unless the Joint-Venturers otherwise agree
in writing, each Joint-Venturer shall be bound by a fiduciary duty to the Joint
Venture and the other Joint-Venturers to the same extent that applicable law
generally imposes such status and duty upon a general partner in a partnership.
6.9 Compensation of Joint-Venturers. The Joint Venture will not
pay fees or other compensation to any Joint-Venturer unless the Joint-Venturers
by unanimous vote otherwise agree.
ARTICLE VII
The Joint-Venturers
7.1 Meetings of the Joint-Venturers. Meetings of the
Joint-Venturers shall be held upon the call of any Joint-Venturer; provided that
at least three days' prior notice shall be given to all Joint-Venturers with
respect to any meeting of Joint-Venturers, including an annual meeting of
Joint-Venturers; and further provided that any Joint-Venturer may require that
such meeting be held by telephone. A waiver of any required notice shall be
equivalent to the giving of such notice if such waiver is in writing and signed
by the Person entitled to such notice, whether before, at or after the time
stated therein. The Joint-Venturers may make use of telephones and other
electronic devices to hold meetings, provided that each Joint-Venturer is able
to simultaneously participate with the other Joint-Venturers with respect to all
discussions and votes of the Joint-Venturers. The Joint Venturers may act
without a meeting if the action taken is reduced to writing (either prior to or
thereafter) and consented to in writing by the requisite number of
Joint-Venturers. Written minutes shall be taken at each meeting of the
Joint-Venturers; however, any action taken or matter agreed upon by the
Joint-Venturers at the meeting shall be deemed final, whether or not written
minutes of the meeting are prepared or finalized.
7.2 Voting of the Joint-Venturers. All actions, agreements,
approvals and consents required in this Agreement to be made by "the
Joint-Venturers" shall be effective if approved by the unanimous consent of all
Joint Venturers.
7.3 Other Business Interests of the Joint-Venturers. This
Agreement shall not be construed to grant any right, privilege or option to a
Joint-Venturer to participate in any manner in any other business, corporation,
partnership or investment in which another Joint-Venturer may participate,
including those which may be the same as or similar to the Joint Venturers
business and in direct competition therewith, and each of the Joint-Venturers
expressly waives the doctrine of corporate opportunity (or any analogous
doctrine) with respect to any such other business, corporation, partnership or
investment of the other Joint-Venturers or their Affiliates.
7.4 Rights and Obligations of Joint-Venturers. Each Joint-Venturer
shall have the right, during ordinary business hours, to inspect and copy, at
such Joint-Venturer's expense, the Joint Venture records required to be
maintained at the Joint Venture's office as set forth in Section 8.1 hereof.
7.5 Defaulting Joint-Venturer.
(a) Events of Default. The occurrence of any of the
following events shall constitute an "Event of Default": (i) attempted
dissolution of the Joint Venture by any Joint-Venturer other than pursuant to
the provisions contained in this Agreement; (ii) the Withdrawal Event of a
Joint-Venturer (not including the death of such Joint-Venturer); or (iii)
failure of any Joint-Venturer to perform any obligation, act or acts required of
that
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Joint-Venturer by the provisions of this Agreement, or a violation or a breach
of any of the other terms or provisions of this Agreement; provided, however,
that a Joint-Venturer shall not be deemed to be in default of this Section
7.5(a)(iii) until that Joint-Venturer has failed to cure the default during the
30-day period following the receipt of notice of such default, except that if
the default is a nonmonetary default and cannot reasonably and with due
diligence and in good faith be cured within the 30-day period, and if the
defaulting Joint-Venturer immediately commences and proceeds to complete the
cure of such default with due diligence and in good faith, the 30-day period
with respect to such default shall be extended to include such additional period
of time as may be reasonably necessary to cure such default, not to exceed 180
days.
(b) Effect of Default. Notwithstanding anything in this
Agreement to the contrary, on the date that a Joint-Venturer is determined by a
court of competent jurisdiction to be a Defaulting Joint-Venturer, that
Joint-Venturer shall not have any voting rights with respect to any matters set
forth in this Agreement, including but not limited to all approval rights set
forth in Article VI and Article VII.
(c) Remedies on Default. Upon the occurrence of an Event of
Default by a Joint-Venturer, the Joint Venture and the non-Defaulting
Joint-Venturers shall have all rights and remedies available at law and in
equity and may institute legal proceedings as authorized herein against the
Defaulting Joint-Venturer with respect to any damages or losses incurred by the
Joint Venture or by any Non-Defaulting Joint-Venturers. The Joint Venture shall
be entitled to reasonable attorneys' fees and expenses incurred in connection
with the collection of such amounts, together with interest thereon.
(d) Jurisdiction. Upon the occurrence of an Event of
Default, the non Defaulting Joint-Venturers may seek appropriate relief in a
United States District Court, unless the parties jointly agree to an alternative
forum, for the breach of the Agreement by the Defaulting Joint Venturer. In the
event that the United States District Court determines that it cannot exercise
jurisdiction over such a claim, then and only then may the parties seek relief
in the appropriate California state court.
(e) Limited Waiver of Sovereign Immunity. Table Mountain
hereby waives its sovereign immunity from suit solely for purposes of
enforcement of the terms of this Agreement. This waiver is a limited waiver of
immunity, and any damages which may arise as a result of Table Mountain's or its
officially recognized representatives' action shall be limited exclusively to
Table Mountain's interest in the Joint Venture or its interest in revenues
derived from the operation of the Joint Venture.
This limited waiver of sovereign immunity is granted
solely for purposes of implementing this Agreement and shall be regarded as a
limited waiver of sovereign immunity in any subsequent court proceeding
commenced for purposes of enforcing the terms of this Agreement. Nothing
contained in this limited waiver shall be construed to confer any benefit,
tangible or intangible, on any person or entity not a party to this Agreement or
as a waiver with respect to any such third person or entity. Table Mountain's
limited waiver of its sovereign immunity hereunder extends only to a direct
action by the non-Defaulting Joint-Venturers for money damages, specific
performance, injunctive relief, and/or declaratory relief for Table Mountain's
default under this Agreement.
ARTICLE VIII
Books, Records, Reports and Accounting
8.1 Records. The Joint-Venturers shall keep or cause to be kept at
the office of the Joint Venture the following: (a) a current list of the full
name and last known business, residence or mailing address of each
Joint-Venturer; (b) copies of all written Joint Venture agreements and all
amendments to the agreements, including any prior written Joint Venture
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agreements no longer in effect; (c) copies of the Joint Venturers federal, state
and local income tax returns and reports, if any, for the three most recent
years; (d) copies of any prepared financial statements of the Joint Venture for
the three most recent years; (e) minutes of every meeting of Joint-Venturers as
well as any written consents of Joint-Venturers or actions taken by
Joint-Venturers without a meeting and (f) all records relating to the financial
affairs of the Joint Venture. Any such records maintained by the Joint Venture
may be kept on or be in the form of any information storage device, provided
that the records so kept are convertible into legible written form within a
reasonable period of time.
8.2 Fiscal Year and Accounting. The Fiscal Year of the Joint
Venture shall be August 1 through July 31. All decisions as to other accounting
matters, except as specifically provided to the contrary herein, shall be made
by the Joint-Venturers.
8.3 Preparation of Tax Returns. The Joint-Venturers shall arrange
for the preparation and timely filing of all returns of the Joint Venture for
federal and state income tax purposes and shall cause to be furnished to the
Joint-Venturers the tax information reasonably required for federal and state
income tax reporting purposes. The classification, realization and recognition
of income, gain, losses and deductions and other items, for federal income tax
purposes, shall be on that method of accounting as the Joint-Venturers shall
determine.
8.4 Tax Elections. The Joint-Venturers made in their discretion
determine whether to make any available elections pursuant to the Code.
8.5 Tax Controversies. Subject to the provisions hereof, ACES is
designated Tax Matters Joint-Venturer and shall be authorized and required to
represent the Joint Venture (at the Joint Venture's expense) in connection with
all examinations of the Joint Venture's affairs by tax authorities, including
resulting administrative and judicial proceedings, and to expend Joint Venture
funds for professional services and costs associated therewith. The
Joint-Venturers agree to cooperate with the Tax Matters Joint-Venturer and to do
or refrain from doing any or all things reasonably required by the Tax Matters
Joint-Venturer to conduct those proceedings. The Tax Matters Joint Venturer
agrees to promptly notify the Joint-Venturers upon the receipt of any
correspondence from any federal, state or local tax authorities relating to any
examination of the Joint Venture's affairs.
ARTICLE IX
Transfers, Withdrawals
9.1 Transfers.
(a) Restriction. A Joint-Venturer shall not make any
Transfer of all or any portion of its Interest including, without limitation, a
Transfer of a right to Profits, Losses or distributions to a Transferee who does
not become a substituted Joint-Venturer of the Joint Venture. Any Transfers made
in violation of this Agreement shall be an Event of Default of the Transferring
Joint-Venturer and such Transfer shall be void.
(b) Requirements for Transferee Becoming a Substituted
Joint-Venturer. No Transferee shall become a substituted Joint-Venturer in the
Joint Venture unless and until the following conditions are satisfied: (i) by
affirmative vote all Joint-Venturers shall have consented to the Transferee
becoming a Joint-Venturer hereof; (ii) the Transferee shall agree to any and all
of the obligations under this Agreement with respect to the Interest to which
the Transfer relates; (iii) all expenses of the Joint Venture required in
connection with the Transfer shall have been paid by or for the account of the
Transferee; and (iv) all agreements, minutes, written consents, and other
necessary documents and instruments shall have been executed and filed and all
other acts shall have been performed which are necessary to make the Transferee
a substitute
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Joint-Venturer of the Joint Venture.
9.2 Notice. Within 30 days of the Withdrawal Event of a
Joint-Venturer, that Joint-Venturer (or its successor) shall be required to give
notice to the other Joint-Venturers of such event (the "Withdrawal Notice").
9.3 Withdrawal of a Joint-Venturer. A Joint-Venturer shall not
have the right to withdraw from the Joint Venture. Upon the Withdrawal Event of
a Joint-Venturer ("Withdrawn Joint Venturer"), that Joint-Venturer shall not be
entitled to receive the value of its Interest; rather, the other Joint-Venturer
shall have the right to admit a new Joint-Venturer and continue the Joint
Venture, and the Withdrawn Joint-Venturer (or its successor-in-interest) shall
be treated as an assignee of its Interest and shall have no Joint-Venturer
rights except the right to continue to receive distributions pursuant to
Articles IV and X hereof to the extent the Joint Venture is continued; provided,
however, if the withdrawal is an Event of Default under Section 7.5(a)(ii) any
damages incurred by the Joint Venture or the other Joint-Venturers as a result
of a Withdrawal Event of a Joint Venturer shall be offset against any amounts
distributable by the Joint Venture to the Withdrawn Joint-Venturer. If any
Withdrawal Event occurs with respect to a Joint-Venturer, the Participating
Percentage relating to the Interest of the Withdrawn Joint-Venturer shall
thereafter remain unchanged except that it shall be decreased, pro rata based on
the Participating Percentages of all of the Joint Venturers, if any new
Joint-Venturers are admitted to the Joint Venture.
ARTICLE X
Liquidation and Winding Up
10.1 Dissolution. The Joint Venture shall dissolve, and its
affairs shall be wound up, only upon the earlier of:
(a) the agreement of the Joint-Venturers;
(b) the death of an individual
Joint-Venturer;
(c) the Bankruptcy of a Joint-Venturer or
the Joint Venture;
(d) the occurrence of any event which makes it unlawful for
the business of the Joint Venture to be carried on or for the Joint-Venturers to
carry on that business in Joint Venture; or
(e) the occurrence or any other event, not specifically set
forth in this Section 10.1 which causes the dissolution of the Joint Venture
under applicable law, except a transfer of an Interest to which all other
Joint-Venturers have consented;
10.2 Liquidation. Upon dissolution of the Joint Venture, the
business and affairs of the Joint Venture shall be wound up, and the Joint
Venture shall be liquidated as rapidly as business circumstances permit. The
Joint-Venturers shall appoint the liquidating trustee(s), and the assets of the
Joint Venture shall be liquidated and the proceeds thereof shall be paid (to the
extent permitted by applicable law) in the following order:
(a) First, to creditors, including Joint-Venturers that are
creditors, in the order of priority as required by applicable law;
(b) Second, to a reserve for contingent liabilities to be
distributed at the time and in the manner as the liquidating trustee determines
in its discretion; and
(c) Thereafter, to the Joint-Venturers, as provided in
Section 4.2, above.
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If the Joint-Venturers determine that an immediate sale of the Joint Venture's
assets and liquidation of the Joint Venture would cause undue losses to the
Joint-Venturers, they may defer liquidation of any assets, other than those
assets necessary to satisfy current obligations, for a reasonable time, or may
distribute such assets in kind according to the order and priority set forth in
this section. Any assets distributed in kind shall be valued and treated as
though the assets were sold and the cash proceeds were distributed.
10.3 Reasonable Time for Winding Up. A reasonable time shall be
allowed for the orderly winding up of the business and affairs of the Joint
Venture and the liquidation of its assets pursuant to Section 10.3 hereof in
order to minimize any Inc___s otherwise related to that winding up.
10.4 Deficit Capital Account. Upon the dissolution of the Joint
Venture, all Joint Venturers shall be required to contribute to the Joint
Venture an amount equal to the deficit balance, if any, in the respective
Capital Accounts after taking into account all investments to the Capital
Accounts for the Fiscal Year. No creditor of the Joint Venture shall be entitled
to rely upon this Section 10.4 as a third party beneficiary.
ARTICLE XI
Miscellaneous
11.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the United States.
11.2 Notices. All notices, consents, approvals, reports,
designations, requests, waivers and other communications (collectively
"Notices") authorized or required to be given pursuant to this Agreement shall
be in writing and either (a) personally served on the Joint-Venturer to whom it
is given, (b) mailed by registered or certified mail, postage prepaid, or (c)
sent by facsimile (and also mailed by registered or certified mail within 24
hours thereafter), addressed to the addresses set forth on the signature page
hereto. All Notices shall be deemed given when delivered or, if mailed by
government mail, on the third day after the day of mailing, and if sent by
facsimile, 24 hours after the time of dispatch. Any Joint-Venturer may change
its address for the receipt of Notices at any time by giving written notice
thereof to the other Joint-Venturers in accordance with the terms of this
Section 11.2. The inability to deliver notice because of a changed address of
which no notice was given, or rejection or other refusal to accept any notice,
shall not defeat the giving of such notice. Any notice to be given by any party
herein may be given by counsel for such party. Notwithstanding the requirement
as to the use of registered or certified mail, any routine reports required by
this Agreement to be submitted to Joint-Venturers at specified times may instead
be sent by first-class mail.
11.3 Severability. If any provision of this Agreement shall be
conclusively determined by a court of competent jurisdiction to be invalid or
unenforceable to any extent, the remainder of this Agreement shall not be
affected thereby.
11.4 Binding Effect. Except as otherwise provided herein, this
Agreement shall inure to the benefit of and be binding upon the Joint-Venturers
and their respective successors and, where permitted, assigns.
11.5 Titles and Captions. All article, section and paragraph
titles and captions contained in this Agreement are for convenience only and are
not a part of the context hereof.
11.6 Pronouns and Plurals. All pronouns and any variations thereof
are deemed to refer to the masculine, feminine, neuter, singular or plural as
the identity of the appropriate Person(s) may require.
11.7 No Third Party Rights. This Agreement is intended to create
enforceable rights between the parties hereto only, and creates no rights in, or
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obligations to, any other Persons whatsoever.
11.8 Time is of Essence. Time is of the essence in the
performance of each and every obligation herein imposed.
11.9 Further Assurances. The parties hereto shall execute all
further instruments and perform all acts which are or may become necessary to
effectuate and to carry out the ___ttels contemplated by this Agreement.
11.10 Estoppel Certificates. The Joint-Venturers hereby agree
that, at the request of any Joint-Venturer, they will each execute and deliver
an estoppel certificate stating, to the extent true, that this Agreement is in
full force and effect and that to the best of such Joint-Venturer's knowledge
and belief there are no defaults by any Joint-Venturer or that certain defaults
exist, as the case may be, under this Agreement.
11.11 Schedules Included in Exhibits; Incorporation by Reference.
Any reference to an Exhibit to this Agreement contained herein shall be deemed
to include any Schedules to such Exhibit. Each of the Exhibits referred to in
this Agreement, and each Schedule to such Exhibits, is hereby incorporated by
reference in this Agreement as if such Schedules and Exhibits were set out in
full in the text of this Agreement.
11.12 Amendments. This Agreement may not be amended except by
unanimous written agreement of all of the Joint-Venturers.
11.13 Creditors. None of the provisions of this Agreement shall be
for the benefit of or enforceable by any creditors of the Joint Venture.
11.14 Entire Agreement. This Agreement and the Exhibits hereto
contain all of the agreements between the parties hereto and supersedes any and
all prior agreements, arrangements or understandings between the parties
relating to the subject matter hereof. No oral understandings, oral statements,
oral promises or oral inducements exist. No representations, warranties,
covenants or conditions, express or implied, whether by statute or otherwise,
other than as set forth herein, have been made by the parties hereto.
ARTICLE XII
Definitions
The following terms used in this Agreement shall have the meanings
described below:
"Affiliate" means a Person who, with respect to any other Person:
(a) directly or indirectly controls, is controlled by or is under common control
with such other Person; (b) owns or controls 10 percent or more of the
outstanding voting securities of such other Person; (c) is an officer, director,
partner or member of such other Person; or (d) if such other Person is an
officer, director, partner, manager, trustee, or member of any Person for which
such other Person acts in any such capacity.
"Agreement" means this joint venture agreement as it may be
amended from time to time, complete with all exhibits and schedules hereto.
"Bankruptcy" means, with respect to a Person, the happening of any
of the following:
(a) the making by such Person of a general assignment for
the benefit of creditors;
(b) the filing by such Person of a voluntary petition in
bankruptcy or the filing of a pleading in any court of record admitting in
writing an inability to pay debts as they become due;
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(c) the entry of an order, judgment or decree by any court
of competent jurisdiction adjudicating the Person to be bankrupt or insolvent;
(d) the filing by such Person of a petition or answer
seeking any reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any statute, law or regulation;
(e) the filing by such Person of an answer or other
pleading admitting the material allegations of, or consenting to, or defaulting
in answering, a bankruptcy petition filed against the Person in any bankruptcy
proceeding;
(f) the filing by such Person of an application or other
pleading or any action otherwise seeking, consenting to or acquiescing in the
appointment of a liquidating trustee, receiver or other liquidator of all or any
substantial part of the Person's properties;
(g) the commencement against such Person of any proceeding
seeking reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any statute, law or regulation which has not
been quashed or dismissed within 180 days; or
(h) the appointment without the consent or acquiescence of
such Person of a liquidating trustee, receiver or other liquidator of all or any
substantial part of such Person's properties without such appointment being
vacated or stayed within 90 days and, if stayed, without such appointment being
vacated within 90 days after the expiration of any such stay.
"Capital Account" shall mean the accounting record of each
Joint-Venturer's capital interest in the Joint Venture. There shall be credited
to each Joint-Venturer's Capital Account (a) the amount of any contribution of
cash by that Joint-Venturer, (b) the Gross Asset Value of property contributed
by that Joint-Venturer, (c) that Joint-Venturer's allocable share of Profits and
any items in the nature of income or gain that are specially allocated to that
Joint-Venturer, and (d) the amount of any Joint Venture liabilities that the
Joint-Venturer assumes, or takes subject to, under Code section 752. There shall
be debited against each Joint-Venturer's Capital Account (i) the amount of all
distributions of cash to that Joint-Venturer unless a distribution to the
Joint-Venturer is a loan or is deemed a payment under Code section 707(c), (ii)
the Gross Asset Value of property distributed to that Joint-Venturer by the
Joint Venture, (iii) that Joint-Venturer's allocable share of Losses and any
items in the nature of losses or expenses that are specially allocated to that
Joint-Venturer, and (iv) the amount of any liabilities of that Joint-Venturer
that the Joint Venture assumes, or takes subject to, under Code section 752. The
permitted transferee of all or a portion of an Interest shall succeed to that
portion of the transferor Joint-Venturer's Capital Account that is allocable to
the portion of the Interest transferred. This definition of Capital Account and
the other provisions herein relating to the maintenance of Capital Accounts are
intended to comply with Treasury Regulation sections 1.704-1(b) and 1.704-2 and
shall be interpreted and applied in a manner consistent with those Treasury
Regulation sections. In the event the Joint-Venturers determine that it is
prudent to modify the manner in which the Capital Accounts, or any debits or
credits thereto (including, without limitation, debits or credits relating to
liabilities that are secured by contributed or distributed property or which are
assumed by the Joint Venture or the Joint-Venturers), are computed in order to
comply with that Treasury Regulation, the Joint-Venturers may make such
modification. The Joint Venturers shall also make any appropriate modifications
in the event unanticipated events might otherwise cause this Agreement not to
comply with Treasury Regulation sections 1.704-l(b) and 1.704-2.
"Capital Contribution" means, with respect to any Joint-Venturer,
an amount of money contributed by that Joint-Venturer to the Joint Venture and,
if property other than money is contributed, the Gross Asset Value of such
property, net of liabilities assumed or taken subject to by the Joint Venture.
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"Code" shall mean the Internal Revenue Code of 1986 (or successor
thereto), as amended from time to time.
"Defaulting Joint-Venturer" means a Joint-Venturer that has
committed an Event of Default as described in Section 7.5 hereof.
"Event of Default" shall have the meaning set forth in Section
7.5(a) hereof.
"Fiscal Year" means the year on which the accounting and federal
income tax records of the Joint Venture are kept.
"Gross Asset Value" shall mean with respect to any Joint Venture
asset, the asset's adjusted federal income tax basis (as determined in Code
section 1011) except that (a) with respect to any asset contributed by a
Joint-Venturer to the Joint Venture, its Gross Asset Value shall be the gross
fair market value of that asset and (b) the Gross Asset Value of all Joint
Venture assets shall be adjusted to their respective gross fair market values
upon the acquisition of an additional interest in the Joint Venture by a new or
existing Joint-Venturer, upon the distribution in full or partial liquidation of
an Interest, or upon the liquidation of the Joint Venture. For purposes of
determining the continuing Gross Asset Value of an asset, all depreciation,
amortization and cost recovery deductions with respect to each asset shall be
based on the Gross Asset Value of that asset and shall further adjust the Gross
Asset Value of that asset.
"Interest" means the interest of a Joint-Venturer in the Joint
Venture representing such Joint-Venturer's rights, powers and privileges as
specified in this Agreement.
"Participating Percentage" means the percentage interest of each
Joint-Venturer as described on Exhibit B hereto.
"Joint-Venturer" means any Person that executes this Agreement as
a Joint-Venturer and any other Person admitted to the Joint Venture as an
additional or substituted Joint Venturer, that has not made a disposition of
such Person's entire Interest.
"Joint Venture" means the joint venture formed pursuant to this
Agreement, as such joint venture may from time to time be constituted.
"Person" means an individual, firm, corporation, partnership,
limited liability company, association, estate, trust, pension or profit-sharing
plan, Indian tribe or any other entity.
"Policy" shall have the meaning set forth in Section 3.1 hereof.
"Prime Rate" means the "prime rate" published in the "Money Rates"
or equivalent section of the Western Edition of The Wall Street Journal,
provided that if a "prime rate" range is published by The Wall Street Journal,
then the highest rate of that range will be used, or if The Wall Street Journal
ceases publishing a prime rate or a prime rate range, then the Joint-Venturers
will select a prime rate, a prime rate range or another substitute interest rate
index that is based upon comparable information.
"Principal Office" means the office of the Joint Venture at which
the records of the Joint Venture are kept.
"Transfer" means to sell, assign, transfer, give, donate, pledge,
deposit, alienate, bequeath, devise or otherwise dispose of or encumber to any
Person other than the Joint Venture.
"Transferee" means a Person to whom a Transfer is made.
"Treasury Regulations" shall mean pronouncements, as amended from
time to
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time, or their successor pronouncements, which clarify, interpret and apply the
provisions of the Code, and which are designated as "Treasury Regulations" by
the United States Department of the Treasury.
"Withdrawal Event" shall mean the following: (a) the death of a
Joint-Venturer; (b) the Bankruptcy of a Joint-Venturer; or (c) the withdrawal of
a Joint-Venturer from the Joint Venture without the unanimous consent of the
remaining Joint-Venturers.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective as of the day and year first written above.
TABLE MOUNTAIN RANCHERIA AMERICAN CASINO ENTERPRISES, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------- ------------------------------
▇▇▇▇ ▇▇▇▇▇▇, Chairman ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, President
Table Mountain Rancheria American Casino Enterprises, Inc.
▇.▇. ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Table Mountain Development Group
Exhibit A
Capital Contributions of each Joint-Venturer
JOINT-VENTURERS: DATE: CONTRIBUTIONS
Table Mountain Development Group
Exhibit B
Participating Percentages As of
Feb. 1, 1996
American Casino Enterprises, Inc. 80%
Table Mountain Rancheria 20%