MEMBERS AGREEMENT
OF
ARDENT GAMING, L.L.C.
This Agreement is made as of this 15th day of May, 2001 by Isle of Capri
Casinos, Inc., a Delaware corporation ("Isle") and Ardent Technology, L.L.C., a
Nevada limited liability company ("Ardent"). Isle and Ardent, together with any
other members of the Company who may become parties to this Agreement from time
to time, are sometimes herein referred to as the "Members" or individually as a
"Member".
WHEREAS, Isle and Ardent are the initial Members of the Company and are
parties with the Company to an Operating Agreement dated as of the date of this
Agreement;
WHEREAS, Ardent has developed a proprietary System consisting of a
coin-free, ticket free system used, among other things, to transfer money
between a hand held electronic funds carrier and a gaming device, known as the
Easy Money or SafeCash System;
WHEREAS, additional funding is required to complete the development of the
System, to obtain required regulatory consents and to market the System; and
Isle is willing to provide such funding under the terms and conditions of this
Agreement;
WHEREAS, the Members have formed the Company for the purpose of completing
the development of and commercializing the System;
WHEREAS, Ardent has contributed certain assets to the Company including all
its rights in and to the System;
WHEREAS, Isle has made an initial cash contribution to the Company of
$352,000 and has agreed to make certain Additional Contributions to the Company
under the terms and conditions hereof;
WHEREAS, the parties wish to set forth certain agreements with respect to
the foregoing and their respective rights and obligations;
THEREFORE, the parties agree as follows:
ARTICLE I: INITIAL OWNERSHIP INTEREST AND DEFINITIONS
1.1 INITIAL OWNERSHIP. The parties acknowledge that, based on the Initial
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Contributions of the Members set forth in Section 3.1 below, as of the date
hereof, the Ownership Interest of the Company shall be as set forth below:
Member Ownership Interest Initial Contribution
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Ardent 92.0% $4,048,000
Isle 8.0% $352,000
The Ownership Interest shall be adjusted from time to time in accordance
with the provisions of this Agreement and the Operating Agreement. The
Ownership Interests of the Members shall at all times be maintained on Appendix
I to the Operating Agreement, which shall be amended chronologically from time
to time as necessary.
1.2 DEFINITIONS. Capitalized terms not otherwise defined in Exhibit A
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hereto shall have the respective meanings ascribed for those terms in the
Operating Agreement, applicable to both singular and plural forms, for all
purposes of this Agreement.
ARTICLE 2: OPERATION OF THE COMPANY
2.1 BUSINESS PLAN. The Members anticipate that certain expenditures will be
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made in the development and commercialization of the System pursuant to the
Business Plan attached hereto as Exhibit B, which includes (i) the initial
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Budget for the Company, (ii) the System development plan, (iii) a description of
required jurisdictional approvals and schedule, (iv) a development schedule,
(v) a schedule of the amounts and timing of funding by Isle and (vi) a
description of the roles of the parties. The Members anticipate that these
costs will be funded by Isle pursuant and subject to the terms of Section 3.3
hereof and subject to the other terms and conditions of this Agreement. The
Chief Executive Officer shall submit to the Managers proposed revisions to the
Business Plan not less frequently than annually, at least 60 days prior to the
start of the first fiscal year covered by such Business Plan. Each such
Business Plan shall be considered at the first meeting of the Managers following
its submissions and shall be subject to the unanimous approval of the Managers.
Any material amendments to the Business Plan, including any amendment that is
expected to increase the Budget by more than ten percent (10%) as compared to
the prior year's Budget, shall be subject to the unanimous approval of the
Managers.
2.2 BUDGET APPROVAL. The Chief Executive Officer shall include a proposed
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Budget for the Company for the next fiscal year in his submission of the revised
Business Plan. The Budget shall include an income statement, balance sheet, and
capital budget prepared consistently with the Company's method of accounting,
for the forthcoming fiscal year and a cash flow statement which shall show in
reasonable detail the anticipated receipts and disbursements (including
anticipated distributions) projected for the Company for the forthcoming fiscal
year and the amount of any corresponding cash deficiency or surplus, and the
amount and due dates of any proposed Additional Contributions. The Budget shall
be prepared on a basis consistent with the Company's financial statements and
shall be prepared in accordance with the provisions of this Agreement. Each
Budget shall be considered at the first meeting of the Managers following its
submission and shall be subject to their unanimous approval. Each Budget shall
also include a detailed explanation of the proposed related party charges for
corporate overhead or services proposed to be charged by any Member in
connection with services to be provided by such Member or its Affiliates to the
Company. Without the unanimous approval of the Managers, a Budget shall not
include an increase in expenditures of more than ten percent (10%) as compared
to the prior year's Budget for the Company. If for any fiscal year no new
Budget is agreed upon and approved, then the Company will be managed in a manner
consistent with the operations for the prior fiscal year, as adjusted to reflect
the Company's contractual obligations for the year.
2.3 CHIEF EXECUTIVE OFFICER. The Chief Executive Officer of the Company
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shall initially be ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇. The Members shall mutually agree on any
replacement or successor Chief Executive Officer.
2.4 EMPLOYEE COSTS. Except as otherwise expressly provided in this
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Agreement or the Business Plan or Budget, each Member will be separately
responsible for its own payroll and benefit expense of its employees and
independent contractors with respect to Company business.
2.5 FINANCING. Except for the Initial Contributions by the Members and the
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Additional Contributions by Isle provided for in Section 3.3 of this Agreement,
the Members acknowledge and agree that the Company shall incur no debt or
liability for which the Members or their respective Affiliates would be
obligated in any way. Without limiting the foregoing, no Member or Affiliate
will be required to guarantee or co-sign any loan made to the Company or any
other obligation of the Company.
2.6 PRIMARY RESPONSIBILITIES. The Members shall operate the Company so as
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to take advantage of their particular areas of expertise and experience. Isle
will be primarily responsible for regulatory and licensing matters and Ardent
will be primarily responsible for completing the development of the System, for
marketing and sales and for maintenance and support of the System. The Members
agree to use their respective best efforts in furtherance of the company's
business in their respective areas of primary responsibility and at all times to
operate with diligence and professionalism.
2.7 CORPORATE OVERHEAD. In order to best take advantage of the experience,
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expertise and economies of scale which each of the Members can provide to the
Company, the Members may, where necessary and appropriate, utilize the services
of employees of each of the Members to provide services to the Company instead
of hiring new employees specifically for the Company. As such, if applicable, a
portion of such Member's overhead related to the services it provides to the
Company will be charged to the Company, at cost, with the amounts proposed to be
charged set forth in the proposed Budget submitted to the Managers by the Chief
Executive Officer each year and as may be unanimously approved by the Managers.
In addition, each Member will be reimbursed by the Company for all out-of-pocket
monies expended on behalf of the Company, to be budgeted and unanimously
approved by the Managers in advance.
ARTICLE 3: CAPITAL CONTRIBUTIONS
3.1 INITIAL CONTRIBUTIONS.
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[a] BY ARDENT: Ardent has made an Initial Contribution of assets pursuant
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to the Asset Conveyance Agreement attached as Exhibit C hereto, which includes
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the Intellectual Property, (the "Ardent Assets"). The Members agree that the
Fair Market Value of the Ardent Assets is $4,048,000.
[b] BY ISLE: Isle has made an Initial Contribution of $352,000 in cash.
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3.2 CONTRIBUTION OF FUTURE DEVELOPMENTS. Ardent agrees that it will
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disclose to the Company and Isle all inventions, developments, designs,
information, data, software, programs, modifications, improvements,
enhancements, intellectual property rights or other matters that are created,
owned, developed or acquired by Ardent or its Affiliates (for themselves or on
behalf of the Company) after the date of this Agreement and that relate to the
System or its use or function (collectively called the "Future Developments");
and, upon the request of the Company or Isle, Ardent will contribute and assign
all such Future Developments to the Company pursuant to an assignment in form
and content reasonably satisfactory to the Company and Isle. All such Future
Developments so assigned to the Company shall be considered part of the Ardent
Assets comprising the Initial Contribution by Ardent, and Ardent's Ownership
Interest shall not be increased as a result of any such assignment of Future
Developments.
3.3 ADDITIONAL CONTRIBUTIONS.
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[a] ISLE'S FUNDING OBLIGATION. Subject to the provisions hereof, Isle shall
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make additional contributions to the Company in a total amount, together with
the Initial Contribution by Isle, not to exceed two-million two-hundred thousand
dollars ($2,200,000). Subject to Section 3.3[b] below, such Additional
Contributions shall be made in increments of forty-four thousand dollars
($44,000) pursuant to the schedule set forth on Exhibit D. For each Additional
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Contribution in the amount of forty-four thousand dollars ($44,000) that Isle
makes, the Company will issue to Isle an Ownership Interest which, when issued
and outstanding, will represent a one percent (1%) Ownership Interest; provided
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that Isle's total Ownership Interest shall not exceed twenty five percent (25%)
without Ardent's consent. In the event Isle shall make any Additional
Contribution that is more or less than forty-four thousand dollars ($44,000),
the Company shall issue Isle an Ownership Interest that is pro rated based on
one percent (1%) for each forty-four thousand dollars ($44,000) or fraction
thereof. Concurrently with the making of each Additional Contribution, (i)
Isle's capital account shall be appropriately credited, (ii) the Company shall
deliver to Isle an appropriate Certificate representing such additional interest
and (iii) the Company shall make and deliver to Isle appropriate
representations, warranties and indemnities concerning clear title and absence
of encumbrances relating to the additional interest, due authority to issue the
interest and concerning similar matters as are customary, together with an
officers certificate or opinion of counsel as Isle may reasonably request, all
in form and content reasonably acceptable to Isle. Except as set forth above, or
upon the agreement of all Members and upon such terms and conditions as they may
agree in writing, no Additional Contributions will be required or permitted from
the Members of the Company.
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[b] A FAILURE EVENT. Notwithstanding anything to the contrary in this
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Agreement, Isle shall be relieved of any obligation to make any further
Additional Contributions upon the occurrence of any of the following events (a
"Failure Event"):
(i) as of any funding date provided on Exhibit D hereto, the Company fails for
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any reason to meet the milestone, provided in the "Cashless FOB Development
Timeline" (the "Development Timeline") attached to Exhibit D hereto, to have
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been achieved by such funding date;
(ii) the Company or Ardent breach any material warranty, representation or
agreement contained in this Agreement or the Related Agreements, and such breach
remains uncured within 30 days after notice thereof;
(iii) any regulatory authority in Mississippi, Nevada or New Jersey makes a
communication to Ardent, the Company or Isle, which, in Isle's reasonable
determination, leads Isle to believe that the application will be denied or
conditioned; or Isle determines, in its reasonable judgment, that it is
impossible or impracticable to develop the System or acquire the necessary
regulatory approval to market the System in any jurisdiction within the time
frame contemplated by the Development Timeline;
(iv) any regulatory authority in any gaming jurisdiction in which Isle or any of
its Affiliates operates or proposes to operate determines that Ardent or any
Affiliate or principal of Ardent is unsuitable;
(v) there is an event of Bankruptcy as pertains to Ardent or for any other
reason Ardent is unable to fulfill its obligations under this Agreement or the
Related Agreements;
(vi) any of the key employees of Ardent, being ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ V, ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ or ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, die, become disabled, terminate their
relationship with Ardent or the Company or otherwise are unable or unwilling to
devote their services to the Company's business; or
(vii) the Company abandons or fails to prosecute the SafeCash system
provisional patent application (Serial Number 60/231,393) or Isle determines, in
its reasonable judgement, that a patent will not issue containing claims
substantially similar to those contained in such application.
[c] ISLE'S ELECTION UPON A FAILURE EVENT. Upon the occurrence of a Failure
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Event, Isle may, in its discretion, elect any of the following alternatives:
(i) Isle may, by written notice to the Company and Ardent, waive the Failure
Event and make the Additional Contribution required on the next funding date
after the Failure Event pursuant to the schedule on Exhibit D, provided that
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Isle's waiver of a particular Failure Event shall not constitute a waiver of any
other Failure Event that may thereafter occur;
(ii) Isle may elect not to make any further contributions of capital to or
investments in the Company, in which event it shall retain its interest in the
Company as it exists as of date of such election and be relieved of any
obligation to make any Additional Contributions; or
(iii) Isle may elect to sell its Ownership Interest to the Company for a
purchase price equal to the aggregate amount of its Capital Contributions plus
Interest compounded semi-annually from the dates of the respective Capital
Contributions, less the amount of any Distributions to Isle under Section 6.1 of
the Operating Agreement, in which event (a) the Company shall issue to Isle a
promissory note, in form and content acceptable to Isle, in the amount of the
purchase price, bearing Interest, with principal and interest payable in equal
quarterly installments over two (2) years, and secured by a collateral
assignment of Isle's Ownership Interest, and (b) Isle shall resign and withdraw,
without liability, as a member of the Company and shall have no further
obligations under this Agreement or the Operating Agreement.
Notwithstanding the occurrence of a Failure Event, and regardless of whether
Isle makes an election under clause (i), (ii) or (iii) above, the License shall
remain in full force and effect and Isle shall continue to be entitled to
receive the Isle Fee.
3.4 DEFAULT. If Isle fails to make a required Capital Contribution when
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due, other than because of a Failure Event, and after thirty (30) days notice
and an opportunity to cure, Ardent may, as its exclusive remedy and as full and
complete liquidated damages:
[a] Make all or part of such Capital Contribution on its own behalf and
increase its Ownership Interest accordingly; or
[b] Loan all or part of such Capital Contribution amount to the Company,
with such loan payable on demand and with Interest (and such amount will be
treated as a loan rather than as a Capital Contribution); and,
[c] Prohibit Isle from making any further contributions of capital to or
investments in the Company, in which event, (i) Isle shall retain its interest
in the Company as it exists as of such date and shall have no further obligation
to make any Additional Contributions, (ii) Isle shall have no further rights to
receive the Isle Fee, (iii) the License shall remain in effect according to its
terms and (iv) Isle shall have no further right to have the System installed at
its gaming operations at the Company's cost as provided in Section 5.1 below.
3.5 LOANS BY MEMBERS. The Company may borrow money from any Member or
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Affiliate for Company purposes as provided in the Operating Agreement, at the
Interest rate.
3.6 DISTRIBUTIONS. Unless the Members otherwise agree or the Company is
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prohibited by any agreement or indenture, the Company shall, at least quarterly,
distribute the Company's Cash Flow to the Members in accordance with the
provisions of the Operating Agreement.
ARTICLE 4: MANAGEMENT
4.1 UNANIMOUS VOTE. In addition to those matters requiring a unanimous vote
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under the Operating Agreement or under the other provisions of this Agreement,
the following actions by the Company will require the written consent of Isle
and Ardent:
[a] The making of material changes to the Business Plan;
[b] The adoption of any Budget for any year after the initial Budget, or any
increase in the annual Budget, of more than ten percent (10%) from the prior
fiscal year of the Company;
[c] A call for Additional Contributions by the Members other than as
provided for under Section 3.3;
[d] The authorization or the incurrence by the Company of indebtedness for
borrowed money in excess of $100,000 in the aggregate at any time outstanding;
[e] The making of any loans or advances to, or guarantees for the benefit
of, any Member or Affiliate;
[f] The authorization of any transaction between the Company and any Member
or Affiliate;
[g] The taking of any action which may cause the Company to become taxed as
an entity other than a partnership;
[h] The determination to make any capital expenditures or commitments
therefor that aggregate in excess of $200,000 in any one transaction or series
of related transactions;
[i] The entering into any agreement or commitment, or the incurrence of any
obligation, that would require the Company to make expenditures in excess of
$200,000 in any year;
[j] The making of any application by the Company with any gaming authority
in any gaming jurisdiction;
[k] The sale, transfer, pledge, assignment or other disposition of all or
any portion of the Intellectual Property or the granting of any license to or
interest in all or any portion of the Intellectual Property; or,
[l] The taking of any other action not in the ordinary course of the
Company's business.
ARTICLE 5: THE ISLE LICENSE AND FEE
5.1 LICENSE TO ISLE. The Company has granted Isle a License under the
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Intellectual Property, in the form attached hereto as Exhibit E, pursuant to
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which Isle may use the System in its gaming operations and those of its
Affiliates on a royalty-free basis. The License grants Isle exclusive rights
in each of the respective markets in which it or its Affiliates conduct gaming
operations for a period of six (6) months after the installation of the System
in each such market. At Isle's election, the Company and Ardent agree to install
the System at such of the gaming properties of Isle or its Affiliates as Isle
may designate, at a cost to Isle equal to the Company's cost plus eight percent
(8%). If Isle notifies the Company that it has elected not to install the System
at any gaming property, then the Company may sell the System to another operator
in the same market as such gaming property. The License shall be binding on any
successor or assign of the Company and inure to the benefit of any successor or
assign of Isle, provided that the rights granted under the License shall be
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limited to the gaming operations of Isle and its Affiliates, and those whose
development is being planned by Isle and its Affiliates, as of the date of any
such assignment or succession.
5.2 THE ISLE FEE. Within 30 days after the end of each calendar quarter,
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the Company shall pay Isle the Isle Fee based on the number of units of the
System sold, leased, licensed or otherwise disposed of in such quarter to
Persons other than Isle or its Affiliates. With respect to the first
thirty-thousand (30,000) units of the System sold, leased, licensed or otherwise
disposed of, the Isle Fee shall equal the total amount Isle's Capital
Contributions to the Company divided by thirty-thousand (30,000). With respect
to all units of the System sold, leased, licensed or otherwise disposed of after
the first thirty-thousand (30,000) units, the Isle Fee shall equal twenty-five
dollars ($25.00) per unit. The Isle Fee shall be payable to Isle before, and
shall have priority to, any Distributions to the Members or any payments to the
Members for services, goods or corporate overhead. The Isle Fee shall be
considered a royalty and shall not reduce Isle's Capital Account in the Company.
The Isle Fee shall be payable for the longer of the duration of the Company or
the life of the last to expire of the Intellectual Property. As a condition to
any transfer of control of the Company to any third party or any merger,
reorganization or sale or other disposition of the assets of the Company to any
third party, the third party shall provide its written agreement to Isle, in
form and content acceptable to Isle, to be bound by the agreement to pay the
Isle Fee and to abide by the terms of the License.
ARTICLE 6: DISPUTE RESOLUTION
6.1 DISPUTES. Except as to any disputes for which injunctive relief may be
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available, in the event a dispute of any kind arises in connection with this
Agreement or the Related Agreements (including any dispute concerning its or
their construction, performance or breach), the parties to the dispute (who may
be any combination of the Company and any one or more of the Members) will
attempt to resolve the dispute as set forth in Section 6.2 before proceeding to
arbitration as provided in Section 6.3. All documents, discovery and other
information related to any such dispute, and the attempts to resolve or
arbitrate such dispute, will be kept confidential to the fullest extent
possible.
6.2 NEGOTIATION. If a dispute arises, any party to the dispute will give
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notice to each other party. If the Company is not a party to the dispute, notice
will be given to the Company. After notice has been given, the parties in good
faith will attempt to negotiate a resolution of the dispute.
6.3 ARBITRATION. If, within 30 days after the notice provided in Section
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6.2, a dispute is not resolved through negotiation or mediation, the dispute
will be arbitrated. The parties to the dispute agree to be bound by the
selection of an arbitrator, and to settle the dispute exclusively by binding
arbitration in accordance with the following provisions:
[a] All parties to the dispute will collectively select one arbitrator. If
they fail to do so within 45 days after the notice provided in Section 6.2, one
or more parties will request the American Arbitration Association to submit a
panel of five arbitrators who are qualified to resolve the matters in dispute
from which the choice will be made. The party requesting the arbitration will
strike first, followed by alternative striking until one name remains. A
similar procedure will be followed if there are more than two parties. The
parties may by agreement reject one entire list, and request a second list. If
selection by the above method is not completed within 90 days after the notice
provided in Section 6.2, or if there are more than four parties, then an
arbitrator will be selected by the American Arbitration Association. The
arbitrator so selected will then arbitrate the dispute in Las Vegas, Nevada, and
issue an award.
[b] To the extent consistent with the provisions of this Article, the
arbitration will be conducted under the Commercial Arbitration Rules of the
American Arbitration Association and in accordance with Delaware law. The
arbitrators decision will be made pursuant to the relevant substantive law of
the State of Delaware. The award of the arbitrator will be final, binding and
non-appealable. Judgment on the award may be entered in any court, state or
federal court having jurisdiction.
[c] The fees and expenses of the arbitrator, and the other direct costs of
the arbitration, will be shared by the parties to the dispute in equal
proportions. Each party to the dispute will bear all other costs and expenses
as provided in Section 8.8. If one or more Members are included in the
arbitration because of their membership or former membership in the Company,
such group will collectively be treated as one party to the dispute (through the
Company as a party).
ARTICLE 7: PRIVILEGED LICENSE PROTECTION
7.1 REGULATORY COMPLIANCE. Ardent acknowledges that as a result of the
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transactions contemplated by this Agreement, Ardent and its agents and
Affiliates may be subject to licensing and other regulatory review and approval
procedures ("Regulatory Review"), by any governmental or quasi-governmental
agency which is authorized or empowered to regulate the gaming operations of
Isle and its Affiliates ("Regulatory Authority") in the jurisdictions in which
Isle and its Affiliates conduct or propose to conduct gaming activities
including, without limitation, Colorado, Iowa, Mississippi, Louisiana, Missouri,
Nevada and Florida. Ardent agrees to cooperate fully and to cause its
Affiliates to cooperate fully with the representatives of all such Regulatory
Authorities in making applications, supplying information, providing reports,
attending licensing and other hearings, and otherwise cooperating with and
complying with the requirements of all such Regulatory Authorities so as not to
interfere with Isle or its Affiliates ability to develop new business or to
continue to conduct its existing business. Ardent agrees that in the event the
Board of Directors of Isle reasonably determines based upon communications with
a Regulatory Authority that Ardent or any of its Affiliates is likely to be
determined unsuitable by such Regulatory Authority and as a result Isle or its
Affiliates may not be permitted to engage or to continue to engage in a gaming
activity (collectively a "Licensing Problem"), then, within the lesser of 150
days of notice of such event from Isle to Ardent or the applicable period
prescribed by the appropriate Regulatory Authority (provided Isle timely
notifies Ardent of such a determination) Ardent shall eliminate the Licensing
Problem to the reasonable satisfaction of Isle's Board or transfer its rights
and obligations hereunder and its Ownership Interest to a Person reasonably
acceptable to Isle, who does not have a Licensing Problem, and such Person shall
be accepted as a Member of the Company for all purposes. Any such transfer
shall be subject to the terms and conditions contained in Section 13.5 of the
Operating Agreement. All qualification and other expenses relating to the
foregoing applications shall be borne by the respective parties submitting the
applications. The provisions of Section 13.8 of the Operating Agreement shall
apply and shall govern in the event of a conflict with the provisions of Section
7.1 above.
7.2 NO UNSUITABILITY KNOWLEDGE. Neither Ardent nor Isle is aware of any
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facts or circumstances which would make any Member or the officers, directors,
managers, or owners (directly or indirectly) of such Member, a Person or entity
unsuitable for licensing under applicable gaming laws, rules and regulations.
7.3 ADDITIONAL REGULATORY COMPLIANCE MATTERS. Neither the Company nor
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Ardent will market or sell the system to (i) any Person that is not licensed by
the appropriate state regulatory gaming authorities or (ii) in the case of a
Native American gaming operation, which has not entered into a compact with the
appropriate State and which has not received all required approvals from the
NIGC and the Bureau of Indian Affairs. In the event that it is determined to
Isle's satisfaction that a gaming jurisdiction will not permit Isle or its
Affiliates to both conduct gaming operations and, through its interest in the
Company, engage in the business of manufacturing and selling System products,
then Ardent may, at its own cost, manufacture and sell System products only to
users of such products in such gaming jurisdiction and not in any other gaming
jurisdiction.
ARTICLE 8: GENERAL PROVISIONS
8.1 AMENDMENT; EFFECTIVE DATE. This Agreement may be amended by the
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unanimous written agreement of the parties. Any amendment will become effective
upon such approval, unless otherwise provided.
8.2 REPRESENTATIONS AND WARRANTIES. Each Member represents and warrants to
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each other Member that, as of the signing of this Agreement and the Related
Agreements:
[a] Such Member is duly organized, validly existing and in good standing
under the laws of the jurisdiction where it purports to be organized, and is a
United States Person;
[b] Such Member has full power and authority to enter into and perform this
Agreement and the Related Agreements;
[c] All actions necessary to authorize the signing and delivery of this
Agreement and the Related Agreements, and the performance of obligations under
it and them, have been duly taken;
[d] Each of this Agreement and the Related Agreements has been duly signed
and delivered by a duly authorized officer or other representative of such
Member or the Company, as the case may be, and constitutes the legal, valid and
binding obligation of such Member or the Company, as the case may be,
enforceable in accordance with its terms (except as such enforceability may be
affected by applicable bankruptcy, insolvency or other similar laws effecting
creditors' rights generally, and except that the availability of equitable
remedies is subject to judicial discretion);
[e] No consent or approval of any other Person is required in connection
with the signing, delivery and performance of this Agreement or the Related
Agreements by such Member or the Company, as the case may be; and
[f] Neither the execution or the delivery of this Agreement or the Related
Agreements or any document or instrument contemplated hereby or thereby to be
executed and delivered by any Member or its Affiliate or the Company, nor the
fulfillment of or compliance with the terms and provisions of this Agreement or
the Related Agreements and such other documents and instruments, will conflict
with or will result in a breach of, the terms, conditions, or provisions of, or
constitute a default under, or result in any violation of, any judgment, decree,
or any order of any court or any arbitration authority, or any statute, law,
rule, or regulation by which any such Member, or its Affiliate, or the Company,
as the case may be, or their respective assets are affected or bound.
[g] There are no oral or written contracts, agreements, or undertakings
binding upon or affecting any Member or its Affiliate, or its respective assets
that would alter or impair the ability of such Member or Affiliate to enter into
and perform its obligations under this Agreement or the Related Agreements or
any document or instrument contemplated hereby or thereby to be executed and
delivered by any Member or its Affiliate.
8.3 OUTSIDE ACTIVITIES. Any Member or Affiliate thereof may engage in or
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possess any interest in any business, and may do so through itself or through
any other business venture of any nature, independently or with others, and
neither the Company nor any other Member shall have any right by virtue of this
Agreement or the Related Agreements in or to such Member's business or its
other ventures or in or to any income or profits derived therefrom, including
without limitation any of Isle's gaming operations; provided, however, that
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during the term hereof no Member or its Affiliates shall directly or indirectly
have an ownership interest in any Person or engage in any activity involving the
development or sale of coin-free, ticket-free, money transfer products that
compete with the System.
8.4 CONFIDENTIALITY. Except as set forth in this paragraph below, each
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Member shall, and shall cause each of its Affiliates, to keep secret and retain
in strictest confidence, any and all Confidential Information and shall not
distribute, disseminate or disclose such Confidential Information, and any
Person receiving Confidential Information pursuant hereto shall use such
Confidential Information only for the benefit of the Company or for any other
specific purposes for which it was disclosed to such party; provided that a
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Member may (i) disclose Confidential Information to its representatives or
agents on a "need-to-know" basis in connection with the transactions leading up
to and contemplated by this Agreement and the operation of the Company and (ii)
make such announcements and file such documents (including this Agreement) with
the Securities and Exchange Commission, and other regulatory authorities
(including tax and gaming authorities), and otherwise take such actions to
comply with the requirements of federal and state laws as it deems appropriate.
To the extent reasonably practicable, each Member will provide the other with
the portion of any such announcement or filing that refers to this Agreement and
the transactions contemplated by it no later than concurrently with releasing or
filing the same.
8.5 WAIVERS GENERALLY. No course of dealing will be deemed to amend or
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discharge any provision of this Agreement. No delay in the exercise of any
right will operate as a waiver of such right. No single or partial exercise of
any right will preclude its further exercise. A waiver of any right on any one
occasion will not be construed as a bar to, or waiver of, any such right on any
other occasion.
8.6 REMEDIES FOR BREACH. Except as provided in Section 3.4 hereof, the
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rights and remedies of the Members set forth in this Agreement or the Related
Agreements are neither mutually exclusive nor exclusive of any right or remedy
provided by law, in equity or otherwise. Subject to the dispute resolution
provisions of Article 6 and except as provided in Section 3.4 hereof, the
Members agree that all legal remedies (such as monetary damages) as well as all
equitable remedies (such as specific performance) will be available for any
breach or threatened breach of any provision of this Agreement or the Related
Agreements.
8.7 NOTICES. Any notices (including any communication or delivery) required
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or permitted under this Agreement will be in writing and will be addressed as
follows:
If to Isle:
Isle of Capri Casinos, Inc.
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇-▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Ardent:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇-▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
With a copy to: Golden & Silver, LTD.
Ninth Floor
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
All notices may be made by mail, personal delivery, courier service or facsimile
machine, and will be effective upon delivery. Any Member may change such
Person's address by notice to each other Member.
8.8 COSTS. If the Company or any Member retains counsel for the purpose of
-----
enforcing or preventing the breach or any threatened breach of any provision of
this Agreement or the Related Agreements or for any other remedy relating to it
or them, then the prevailing party will be entitled to be reimbursed by the
nonprevailing party for all costs and expenses so incurred (including reasonable
attorneys' fees, costs of bonds, and fees and expenses for expert witnesses)
unless the arbitrator or other trier of fact determines otherwise in the
interest of fairness.
8.9 INDEMNIFICATION. Each Member hereby indemnifies and agrees to hold
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harmless the Company and each other Member from any liability, cost or expense
arising from or related to any act or failure to act of such Member which is in
violation of this Agreement or the Related Agreements.
8.10 PARTIAL INVALIDITY. Wherever possible, each provision of this
-------------------
Agreement will be interpreted in such manner as to be effective and valid under
applicable law. However, if for any reason any one or more of the provisions of
this Agreement are held to be invalid, illegal or unenforceable in any respect,
such action will not affect any other provision of this Agreement. In such
event, this Agreement will be construed as if such invalid, illegal or
unenforceable provision had never been contained in it.
8.11 ENTIRE AGREEMENT. This Agreement, together with its Exhibits and the
-----------------
Related Agreements, which are incorporated by reference herein, contains the
entire agreement and understanding of the Members with respect to its subject
matter, and it supersedes all prior written and oral agreements. No amendment
of this Agreement will be effective for any purpose unless it is made in
accordance with Section 8.1.
8.12 BENEFIT. The obligations of each Member will inure solely to the
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benefit of the other Members and the Company, without conferring on any other
Person any rights of enforcement or other rights.
8.13 BINDING EFFECT. This Agreement is binding upon, and inures to the
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benefit of, the Members and their permitted successors and assigns; provided
that, any Transferee will have only the rights specified in Section 13.6 of the
Operating Agreement unless admitted as a substitute Member in accordance with
this Agreement.
8.14 FURTHER ASSURANCES. Each Member agrees, without further consideration,
------------------
to sign and deliver such other documents of further assurance as may reasonably
be necessary to effectuate the provisions of this Agreement and the Related
Agreements .
8.15 HEADINGS. Article and section titles have been inserted for
--------
convenience of reference only. They are not intended to affect the meaning or
-
interpretation of this Agreement.
8.16 TERMS. Terms used with initial capital letters will have the meanings
-----
specified, applicable to both singular and plural forms, for all purposes of
this Agreement. All pronouns (and any variation) will be deemed to refer to the
masculine, feminine or neuter, as the identity of the Person may require. The
singular or plural include the other, as the context requires or permits. The
word include (and any variation) is used in an illustrative sense rather than a
limiting sense.
8.17 GOVERNING LAW; CONFLICTS WITH OPERATING AGREEMENT. This Agreement will
-------------------------------------------------
be governed by, and construed in accordance with, the laws of the State of
Delaware (except to the extent preempted by any federal law or the gaming laws
of any state or governmental agency having jurisdiction over the affairs of any
Member). Any conflict or apparent conflict between this Agreement and the
Operating Agreement or the Act will be resolved in favor of this Agreement
except as otherwise provided in this Agreement or as required by the Act.
8.18 BROKERS FEES. The parties represent and warrant to one another that no
------------
brokers fees will be due and owing by the Company or any Member to any party in
connection with the subject matter of this Agreement or the Related Agreements.
IN WITNESS WHEREOF, the parties have executed this Members Agreement as of the
date first set forth above.
ISLE OF CAPRI CASINOS, INC.
a Delaware corporation
By: _________________________________________
ARDENT TECHNOLOGY, L.L.C.
a Nevada limited liability company
By: _________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
SCHEDULE OF EXHIBITS
----------------------
EXHIBIT A- DEFINITIONS
EXHIBIT B- BUSINESS PLAN
EXHIBIT C- ASSET CONVEYANCE AGREEMENT
EXHIBIT D- LICENSE AGREEMENT
EXHIBIT E- SCHEDULE OF ADDITIONAL CONTRIBUTIONS AND MILESTONES
EXHIBIT A
---------
DEFINITIONS
ADDITIONAL CONTRIBUTION: A capital contribution (other than the Initial
Contribution) that a Member makes to the Company, as described in Section 3.3.
ASSET CONVEYANCE AGREEMENT: The agreement of even date pursuant to which
Ardent has conveyed certain assets to the Company.
AGREEMENT: This Agreement, as amended from time to time.
BUDGET: The annual budget for the Company.
BUSINESS PLAN: The business plan of the Company, as contained in Exhibit B
hereto, as amended or revised from time to time.
CONFIDENTIAL INFORMATION: All confidential documents and information
concerning the Company or its business, any Member or any Affiliate of a Member
furnished to a Member or an Affiliate or the Company in connection with the
transactions leading up to and contemplated by this Agreement and the operation
of the Company or its business, except to the extent that such information can
be shown to have been (a) generally available to the public other than as a
result of a breach of the provisions of Section 8.4 of this Agreement; (b)
already in the possession of the receiving Person without restriction; (c)
lawfully disclosed to the receiving Person by a third party who is free lawfully
to disclose the same; or (d) independently developed by the receiving Person
without use of any Confidential Information.
FAILURE EVENT: The term as defined in Section 3.3[b] of this Agreement.
FUTURE DEVELOPMENTS: The term as defined in Section 3.2 of this Agreement.
INTELLECTUAL PROPERTY: The intellectual property rights or interests,
including the patents, trademarks, and copyrights, and applications therefor,
and the trade secrets or other proprietary matter, assigned by Ardent to the
Company pursuant to the Asset Conveyance Agreement.
ISLE FEE: The fee payable to Isle pursuant to Section 5.2 of this Agreement.
INITIAL CONTRIBUTION: The initial capital contribution that a Member makes
to the Company, as described in Section 3.1.
LICENSE: The License for the Intellectual Property granted by the Company
pursuant to Section 5.1 of this Agreement and the License Agreement attached as
Exhibit D.
NOTICE: Written notice actually given pursuant to Section 8.7.
OPERATING AGREEMENT: The Operating Agreement of the Company dated as of the
date of the Agreement, as amended from time to time.
REGULATORY AUTHORITY: The term as defined in Section 7.1 of this Agreement
REGULATORY REVIEW: The term as defined in Section 7.1 of this Agreement.
RELATED AGREEMENTS The Operating Agreement, the Asset Conveyance Agreement
------------------- --------------------------------------------------------
and the License.
------------------
EXHIBIT B
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BUSINESS PLAN
EXHIBIT C
---------
ASSET CONVEYANCE AGREEMENT
EXHIBIT D
---------
SCHEDULE OF ADDITIONAL CONTRIBUTIONS AND MILESTONES
EXHIBIT E
----------
LICENSE AGREEMENT
