EXHIBIT 10.1
OPERATING AGREEMENT
RIVER PORT TRUCK STOP, L.L.C.
STATE OF TEXAS STATE OF LOUISIANA
COUNTY OF DALLAS PARISH OF
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BEFORE US, the undersigned authorities, Notaries Public, duly commissioned
and qualified, in and for the State of Texas or State of Louisiana, therein
residing, and in the presence of the witnesses hereinafter named and
undersigned:
PERSONALLY CAME AND APPEARED:
NORTH AMERICAN GAMING AND ENTERTAINMENT CORPORATION, A DELAWARE
CORPORATION, DOMICILED IN DALLAS, TEXAS, WHOSE PERMANENT MAILING ADDRESS IS
00000 XXXX XXXX, XXXXX 000, XXXXXX, XXXXX 00000, HEREIN REPRESENTED BY ITS
DULY AUTHORIZED OFFICER (HEREINAFTER REFERRED TO AS "NAMGC")
XXXXXX X. XXXXXXXX, WHOSE PERMANENT MAILING ADDRESS IS 000 XXXX XXXX,
XXX XXXXX, XXXXXXXXX 00000 (HEREINAFTER REFERRED TO AS "XXXXXXXX")
(HEREINAFTER JOINTLY REFERRED TO AS THE "MEMBERS")
who, as all of the Members of River Port Truck Stop, L.L.C., adopt these
provisions as the Operating Agreement of River Port Truck Stop, L.L.C.:
1. DEFINITIONS
1.1 DEFINITIONS. As used in this Operating Agreement, the following terms
have the following meaning:
1.1.1 "Company" means River Port Truck Stop, L.L.C.
1.1.2 "Act" means the Limited Liability Company Law of the State
of Louisiana and any successor statute as amended.
1.1.3 "Code" means the Internal Revenue Code of 1986 and any
successor statute as amended.
1.1.4 "Member" means any person executing this Operating Agreement
as a Member or hereafter admitted to the Company as a Member as provided in this
Operating Agreement, but does not include any person who has ceased to be a
Member in the Company.
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1.1.5 "Person" has the meaning given that term in the Act.
1.1.6 "Sharing Ratio" means the amount specified on Exhibit "A"
attached hereto.
1.2 GENDER. Whenever the context requires, the gender of all words used
in these regulations includes the masculine, feminine and neuter.
1.3 CONSTRUCTION. Whenever the context requires, terms used herein have
the meaning given them in the Act.
2. ORGANIZATION
2.1 FORMATION: TERM. The Company has been organized as a Louisiana
limited liability company by the filing of Articles of Organization (the
"Articles") under the Act and the issuance of a certificate by the Secretary of
State of Louisiana. The Company shall be dissolved on December 31, 2050, unless
sooner dissolved as provided in this Operating Agreement.
2.2 REGISTERED OFFICE AND AGENT. The Company shall maintain a registered
office and a registered agent in the State of Louisiana, which office and agent
may be changed by vote of Members owning 65% of the Sharing Ratios.
2.3 OTHER OFFICES. The Company may have, in addition to its registered
office, offices and places of business at such places, both within and outside
the State of Louisiana, as the Members may from time to time determine or the
business of the Company may require.
2.4 MEETINGS. Meetings of the Members shall be held at the office of the
Company, or at such other place, either in Dallas, Texas or Baton Rouge,
Louisiana, at a time and date as designated by the Manager in the notice.
Failure to hold an annual meeting shall not affect or vitiate the Company's
existence. If there is no Manager, any Member can designate a time, place and
date for a meeting. Either Member may demand that the Manager call a meeting,
with notice to be given not later than five (5) days after such demand.
2.5 NOTICE OF MEETINGS. Written notice of the time and place of the
meeting of Members shall be given by the Manager to all Members entitled to vote
thereat at the Member's last known address, at least five (5) days and not more
than sixty (60) days prior to the date fixed for said meeting. If there is no
Manager, any Member can give notice.
2.6 VOTING.
2.6.1 DEFINITION. At any meeting of the Members, every Member
having the right to vote shall be entitled to vote in person, or by proxy.
2.6.2 VOTING. There shall be one hundred (100) total votes, which
shall be
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apportioned among the Members in accordance with their Sharing Ratios.
2.6.3 VOTE NECESSARY FOR DECISIONS. Except as otherwise provided
in the Act, the Articles or the Operating Agreement, all decisions of the
Members shall be made by Members owning 65% of the Sharing Ratios, and the
reference herein to a "vote of the Members" or similar language shall mean the
vote by Members owning at least 65% of the Sharing Ratios.
2.6.4 WRITTEN BALLOT. On demand of any Member, the vote on any
question shall be by written ballot.
2.7 PROXIES. Members may give their proxy to the other Member or to non-
Members. All proxies shall be in writing, signed and shall be filed prior to or
at the meeting for which they are given.
2.8 WRITTEN CONSENT. Any action may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by
Members holding the requisite number of votes required to authorize such action
at a meeting of Members, and such consent shall have the same force and effect
as a vote of the Members. A photostatic, facsimile, or similar reproduction of a
writing, signed by a Member shall be regarded as an original for all purposes.
2.9 TELEPHONE CONFERENCE CALLS. Members may participate in meetings by
means of a telephone conference call or similar communication equipment.
2.10 COMPANY RECORDS. The Company shall keep a record of all meetings in a
minute book.
3. CAPITAL
3.1 INITIAL CONTRIBUTION. Each Member shall contribute as capital the
property set forth on Exhibit "A".
3.2 NO RIGHT TO RETURN. No Member has the right to require the return of
all or any part of their capital or a distribution of any property from the
Company prior to its termination.
3.3 NO INTEREST. No interest shall be payable on any capital contribution
made to the Company or on any Capital Account.
3.4 CAPITAL ACCOUNTS. A capital account ("Capital Account") shall be
established and maintained for each Member. The Capital Account of each Member
(a) shall be increased by (i) the amount of money contributed by that Member to
the Company, (ii) the fair market value of property contributed by that Member
to the Company (net of liabilities secured by the contributed property that the
Company is considered to assume or take subject to under section 752 of the
Code), and (iii) allocations to that Member of Company income and gain (or items
thereof), including income and
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gain exempt from tax and income and gain described in Treas. Reg (S)1.704-
1(b)(2)(iv)(g), but excluding income and gain described in Treas. Reg. (S)1.704-
1(b)(4)(i), and (b) shall be decreased by (i) the amount of money distributed to
that Member by the Company, (ii) the fair market value of property distributed
to that Member by the Company (net of liabilities secured by the distributed
property that the Member is considered to assume or take subject to under
section 752 of the Code), (iii) allocations to that Member of expenditures of
the Company described in section 705(a)(2)(B) of the Code, and (iv) allocations
of Company loss and deduction (or items thereof), including loss and deduction
described in Treas. Reg. (S)1.704-1(b)(2)(iv)(g), but excluding items described
in clause (b)(iii) above and loss or deduction described in Treas. Reg. (S)
1.704-1 (b)(4)(i) or (S) 1.704-1(b)(4)(iii). The Members' Capital Accounts also
shall be maintained and adjusted as permitted by the provisions of Treas. Reg.
(S)1.704-1(b)(2)(iv)(f) and as required by the other provisions of Treas. Reg.
(S)(S)1.704-1(b)(2)(iv) and 1.704-l(b)(4), including adjustments to reflect the
allocations to the Members of depreciation, depletion, amortization, and gain or
loss as computed for book purposes rather than the allocation of the
corresponding items as computed for tax purposes, as required by Treas. Reg.
(S)1.704-1(b)(2)(iv)(g). Capital Accounts shall be determined on December 31 of
each year by the Manager. On the transfer of all or part of a Member's
Membership Interests and Sharing Ratios, the Capital Account of the transferor
that is attributable to the transferred Membership Interests and Sharing Ratios
shall carry over to the transferee Member in accordance with the provisions of
Treas. Reg. (S)1.704-1(b)(2)(iv)(l).
3.5 INCREASES OR DECREASES IN CAPITAL.
3.5.1 It is recognized and anticipated that (i) adjustments to
each Member's Capital Account may be required in accordance with generally
accepted accounting practices, or (ii) the Company may require additional
capital from time to time. It is hereby agreed that the Members shall, by
unanimous vote, determine the amount by which the capital of the Company shall
be increased or decreased from time to time.
3.5.2 If any Member refuses or fails to contribute his portion of
additional capital within fifteen (15) days following any approved increase in
Company capital, the remaining Member(s) shall have the right to contribute in
proportion to their respective Capital Accounts the additional amounts necessary
to bring the total capital to the approved increased amount.
3.5.3 Both increases and decreases in the Company capital and any
resulting changes in the Members Capital Accounts shall be reflected in the
Company records.
3.6 DEFICIT CAPITAL ACCOUNTS. Notwithstanding anything to the contrary
contained in this Operating Agreement, and notwithstanding any custom or rule of
law to the contrary, to the extent that the deficit, if any, in the Capital
Account of any Member results from or is attributable to deductions and losses
of the Company (including non-cash items such as depreciation), or distributions
of money pursuant to this Operating Agreement to all Members, upon dissolution
of the Company such deficit shall not be an asset of the Company and such Member
shall not be obligated to contribute such amount to the Company to bring the
balance of such Member's Capital Account to zero.
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4. ALLOCATIONS AND DISTRIBUTIONS
4.1 NET PROFIT ALLOCATION. Any profit realized by the Company shall be
credited to the Members as follows in the following priority:
4.1.1 First, profit shall be allocated to Members pro rata based
on the ratios that the negative Capital Account balance of each Member bears to
the aggregate negative Capital Account balances of all the Members until the
Capital Account balances are increased to zero;
4.1.2 Next, profit shall be allocated to the Members pro rata
based on the ratios that the positive Capital Account balance of each Member
bears to the aggregate positive Capital Account balances of all the Members
until the distributions pursuant to Section 4.3.1 have reduced the Members
positive Capital Account balances to zero; and
4.1.3 Next, any remaining profit shall be allocated to the Members
in accordance with their respective Sharing Ratios.
4.2 NET LOSS ALLOCATION. Any loss realized by the Company shall be
charged to the Capital Accounts of the Members as follows in the following order
of priority:
4.2.1 Any loss shall be charged to the Members pro rata based on
the ratio that the positive Capital Account balance of each Member bears to the
aggregate positive Capital Account balances of all the Members until the Capital
Account balances are reduced to zero; and
4.2.2 Any remaining balance of the loss shall be charged to
Members in accordance with their respective Sharing Ratios.
4.3 DISTRIBUTIONS. Distributions of available cash, less a reasonable
reserve to be determined in good faith by the Manager necessary to fund
operations of the Company for two months, shall be distributed monthly in the
following order of priority:
4.3.1 First, to Members in accordance with the respective positive
Capital Account balances (after Capital Accounts have been adjusted to reflect
all profit and loss allocations and distributions above) until such time as the
Capital Account balances are reduced to zero; and
4.3.2 Any remaining distributions shall be distributed to the
Members in accordance with their respective Sharing Ratios.
Notwithstanding the above provisions of this Section 4.3, the Company shall
distribute, if not already distributed through monthly distributions, an amount
to each Member equal to forty percent (40%) of the net taxable income of the
Company for the preceding taxable year allocated to each Member, so the Members
may use such distributions to pay their individual taxes on their pro rata share
of said taxable income, with such distribution, or the remainder thereof after
taking into
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account monthly distributions, to be made within seventy-five (75) days
following the end of the taxable year to which such distribution relates.
4.4 COMPENSATION. Any Member who performs services for the Company shall
be paid a salary, fee, guaranteed payment, or some sort of compensation to
insure they are adequately compensated for said services, as determined by vote
of the Members.
4.5 TRANSFER. If a Member's Membership Interest and Sharing Ratios are
transferred during a fiscal year of the Company, the Company's taxable year
shall not close, instead, all profits and losses shall be prorated for the
entire taxable year.
4.6 QUALIFIED INCOME OFFSET. A Member who unexpectedly receives any
adjustment, allocation or distribution described in Treas. Reg. (S) 1.704-1
(b)(2)(ii)(d)(4), (5) or (6) will be specially allocated items of Company net
profit and gain in an amount and manner sufficient to eliminate, to the extent
required by the Treasury Regulations, the deficient capital accounting of the
Member as quickly as possible.
5. MANAGERS
5.1 ELECTED MANAGERS. If permitted by the Articles of Organization, the
Members may elect one or more Managers by vote of the Members; provided,
however, that notwithstanding the foregoing provision or any other provision in
this Operating Agreement to the contrary, for as long as that certain Note (the
"Note"), dated April 15, 1998, payable by Xxxxxxxx to NAMGC in the original
principal amount of $4,000,000 remains unpaid there shall only be one Manager of
the Company and NAMGC shall be entitled to designate and appoint, and change
from time to time, such Manager with the consent of Xxxxxxxx (which consent
shall not be unreasonably withheld) by delivering written notice to Xxxxxxxx,
whereupon Xxxxxxxx shall have five (5) days to object to such appointment or
change by delivering written notice thereof to NAMGC, and upon any such
objection, NAMGC shall designate a different Manager and deliver written notice
thereof to Xxxxxxxx for his consent; and, provided, further, that in the event
the appointed Manager repeatedly fails to satisfactorily perform such Manager's
duties hereunder, Xxxxxxxx shall have the right to notify NAMGC who shall
appoint a new Manager if the existing Manager does not cure such failures.
NAMGC's designation and appointment as Manager as of the date of this Operating
Agreement is Xxxxxx X. Xxxxx, which is hereby approved by Xxxxxxxx. Upon
payment in full of the Note, the Manager designated by NAMGC shall be deemed
automatically removed and the Members shall elect one or more Managers under
Section 5.1. A Manager need not be a Member.
5.2 TERM OF OFFICE: REMOVAL. Each Manager shall hold office until his
successor is chosen and qualified or until his earlier death, resignation,
retirement, disqualification or removal from office. Subject to the provisions
of Section 5.1, any Manager elected or appointed by the Members may be removed
at any time by a vote of Members owning 65% of the Sharing Ratios.
5.3 MANAGER: DUTIES. The Manager shall perform such duties as delegated by
the
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Members, or which are incumbent upon him under the provisions of the
Articles and this Operating Agreement. In general, the Manager will manage the
routine daily operations of the Company. Material nondaily operational decisions
will be made by unanimous vote of the Members. The routine daily operations of
the Company (hereinafter referred to as "Non-Major Decisions") shall include:
5.3.1 Signing checks in the name, and on behalf, of the Company;
5.3.2 Opening and closing accounts with banks and other financial
institutions in the name, and on behalf, of the Company;
5.3.3 Putting into effect resolutions and agreements of the
Members adopted under or pursuant to this Operating Agreement;
5.3.4 Retaining, supervising and discharging all employees,
agents, consultants and other persons necessary or appropriate to carry out the
business of the Company, other than Xxxxxxxx under his Amendment to Employment
Agreement described in Section 8.16 or NAMGC under its Consulting and
Administrative Agreement described in Section 8.17;
5.3.5 Taking reasonable and prudent steps to assure that the
Company maintains insurance, in amounts approved by vote of the Members or
included in the current approved budget, to protect the interests of the
Company;
5.3.6 Executing additional video poker operations or other gaming
operating agreements in the name and on behalf of the Company after such
additional agreements have been approved by vote of the Members;
5.3.7 Incurring trade payables and other expenses necessary or
convenient to carry out the purpose and business of the Company in accordance
with the current approved budget;
5.3.8 Keeping and maintaining all books of accounts and other
records of the Company.
5.3.9 Retaining and relying on the advice of legal, accounting and
other consulting professionals to take such actions as are within his authority
otherwise granted in this Section 5.3;
5.3.10 Taking any actions or incurring any expenditures authorized
by a vote of the Members or set forth in the current approved budget approved by
vote of the Members;
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5.3.11 Collecting payments of amounts due the Company under
agreements, contracts, licenses or instruments to which the Company is a party;
and
5.3.12 Taking such actions as such Manager reasonably deems
necessary to assure that the Company complies with all present and future laws,
ordinances, orders, rules, regulations and requirements of all federal, state
and municipal governments, courts, departments, commissions, boards, and
officers, which may be applicable to the Company and its business.
5.4 No act shall be taken, sum expended, or obligation incurred by the
Company or the Manager with respect to a matter within the ambit of any of the
major decisions ("Major Decisions") affecting the Company, as enumerated below,
unless such Major Decisions have been approved by vote of the Members. The Major
Decisions shall include:
5.4.1 Terminating or otherwise materially modifying any truck stop
video poker operating agreements or any agreement, contract, license or
instrument to which the Company is a party and which was required to be approved
by vote of the Members prior to its original execution;
5.4.2 Assigning Company property in trust for creditors or on the
assignee's promise to pay the debts of
5.4.3 Disposing of the goodwill of the Company;
5.4.4 Doing any other act which would make it impossible to carry
on the ordinary business of the Company;
5.4.5 Confessing or agreeing to a judgment against the Company or
settling or otherwise defending any litigation to which the Company is a party;
5.4.6 Submitting a Company claim or liability to arbitration;
5.4.7 Making, executing or delivering for the Company any note,
bond, mortgage, deed of trust, guarantee, indemnity bond, surety bond or
accommodation paper or accommodation endorsement;
5.4.8 Borrowing money in the Company's name or using Company
property as collateral, or refinancing, recasting, modifying or extending any
loan to the Company or that is secured by the property or assets of the Company;
5.4.9 Assigning, transferring, pledging, compromising or releasing
any claim or debt owing to the Company except upon payment in full;
5.4.10 Assigning the right of the Company in specific Company
property for other than a Company purpose;
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5.4.11 Approving execution of any additional video poker operation
or other gaming operating agreement;
5.4.12 Approving the annual budget (or any modifications thereto)
for the following year's operations;
5.4.13 Buying or selling video poker devices;
5.4.14 Any other decision or action which by any provision of this
Operating Agreement is required to be approved by the Members; and
5.4.15 In the absence of a Manager, taking and approving all Non-
Major Decisions.
5.5 ANNUAL BUDGET. The Manager shall be responsible for preparing and
presenting to the Members at least two (2) weeks prior to January 1st of each
year a budget of the Company's proposed operations and expenditures for the
following year. The Members shall have the right to question and change such
budget, and for the budget to be considered an approved budget, it must be
approved by the Members by vote of Members owning at least 65% of the Sharing
Ratios, and the Members agree to use their reasonable best efforts to obtain
such approval by January 15th of the year to which such budget relates.
6. TRANSFER OF A MEMBER'S INTEREST; WITHDRAWAL
6.1 ASSIGNMENT. A Member shall have the right to assign or transfer all
or any part of their Membership Interest ("Assignment") only in accordance with
these provisions.
6.1.1 UNANIMOUS CONSENT. An Assignment shall only give the
Assignee the right to receive such distributions to which the Assignor was
entitled to the extent assigned. An Assignment shall not entitle the Assignee to
become or to exercise any rights or powers of a Member or participate in any
vote or management of the Company until such time as the other Members
unanimously consent in writing.
6.1.2 CREDITOR. A creditor of a Member shall have the same
rights, and only the same rights, as an Assignee.
6.1.3 DEATH OR INCAPACITY. If an individual Member dies or is
adjudged to be incompetent, the Member's legal representative and successors
shall have the same rights, and only the same rights, as an Assignee.
6.1.4 DISSOLUTION. If a Member is a legal entity and is dissolved
or terminated, the Member's legal representative shall have the same rights, and
only the same rights, as an Assignee.
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6.2 WITHDRAWAL. A Member is not entitled to withdraw as a Member from
the Company without the prior consent of all of the Members. Withdrawal of a
Member, with such consent, shall not dissolve the Company unless, within ninety
(90) days after notice of the withdrawal is received by Company, the remaining
Members by unanimous written consent agree to dissolve the Company. If the
remaining Members have consented to the withdrawal and decided to continue the
Company, they shall, within a reasonable time after withdrawal, pay the
withdrawing Member the fair market value of the withdrawing Member's interest in
the Company.
6.2.1 ACCOUNTANT. The fair market value shall be determined by
the CPA then used by the Company to prepare tax returns and such determination
shall be conclusive on all parties. The fair market value shall be determined as
of the date contributed of the Member's capital contribution. If there is no CPA
so used by the Company, then each party, at its own expense, shall hire a CPA.
If the values differ by less than ten (10%) per cent of the lower value, then
the average of the two shall be the value. If the value as determined by each of
the two CPA's differ by more than ten (10%) per cent of the lower, then the two
CPA's shall appoint a third CPA who shall determine the value. The fee of the
third CPA shall be split equally between the parties.
6.2.2 PAYMENT. The amount shall be paid as follows:
6.2.2.1 CASH. At least ten (10%) per cent of the amount
shall be paid in cash or guaranteed funds at Closing. The Company shall have the
option to pay a larger percentage in cash at Closing.
6.2.2.2 NOTE. The balance shall be represented by one
unsecured promissory note (the "Note"), payable to the order of the withdrawing
Member as appropriate, bearing interest at a rate equal to the applicable
federal rate (as defined in the Code and applicable regulations). Principal and
interest payable: In one hundred twenty (120) equal consecutive monthly
installments, the first monthly installment due and payable on or before thirty
(30) days after Closing, and the remaining installments coming due, one each, on
or before the same day of each subsequent and successive calendar month
thereafter, and so continuing until the Note is paid in full. The amount of each
monthly installment shall be applied and credited first to the accrued interest
then due on the total unpaid principal balance, and the remainder of the
installment shall be applied to reduction of the unpaid principal balance. The
Note shall provide (i) that failure to pay any two installments when due and not
corrected within ten (10) days after written notice thereof, shall give the
holder the option to declare the entire remaining balance immediately due and
payable, and (ii) for reasonable attorney fees in the event of a default, and
(iii) other normal clauses.
6.2.3 DELIVERY OF CERTIFICATE. Upon delivery of the Note and the
cash portion of the Purchase Price, the withdrawing Member shall deliver the
properly endorsed Certificate(s) to Company.
6.3 RIGHT OF FIRST REFUSAL: OPTION. Notwithstanding anything to the
contrary, Xxxxxxxx hereby:
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6.3.1 Agrees not to assign, transfer, sell or encumber his
Membership Interests or Sharing Ratios without NAMGC's prior written consent,
except in accordance with Section 6.4, Section 6.5 or Section 6.6; and
6.3.2 Agrees that he shall not have the right to transfer or
assign his Membership Interests or Sharing Ratios, or any portion thereof or
rights therein, to any person unless such person is a Louisiana resident that
satisfies all of the suitability requirements under applicable Louisiana law
necessary for the Company to obtain and hold all Louisiana gaming licenses
necessary for the operation of its video poker casino, and except in accordance
with Section 6.4, Section 6.5 or Section 6.6.
6.4 TRANSFER TO FAMILY MEMBERS BY XXXXXXXX. Notwithstanding any provision
hereof to the contrary, including Sections 6.1, 6.3.1 and 6.3.2, Xxxxxxxx shall
be entitled to transfer all or a portion of his Membership Interests and Sharing
Ratios by inter vivos gift or at death to (i) his spouse, (ii) his descendants,
or (iii) a limited liability company or family partnership owned 100% by
Xxxxxxxx, his spouse and/or his descendants, provided, (a) such transferee shall
take such Membership Interests and Sharing Ratios fully subject to the terms and
conditions of this Agreement and shall execute a written instrument
acknowledging such fact and agreeing to be bound by all of the terms and
conditions of this Agreement, and (b) such transferee is a Louisiana resident
that satisfies all of the suitability requirements under applicable Louisiana
law necessary for the Company to obtain and hold all Louisiana gaming licenses
necessary for the operation of its video poker casino. Upon satisfaction of the
foregoing, such transferee shall be considered a Member hereunder. It shall not
be necessary to obtain the prior consent of NAMGC to any such allowed transfer,
but Xxxxxxxx shall provide prior written notice of the pending transfer to NAMGC
and evidence that all of the conditions set forth in this Section 6.4 have been
satisfied, as a condition precedent to the valid and effective transfer.
6.5 BUY-SELL UPON LOSS OF SUITABILITY. NAMGC and Xxxxxxxx (which shall be
binding on his transferees under Section 6.4) hereby agree to the following buy-
sell provisions in the event either of them fails to meet the suitability
requirements under the Louisiana Video Draw Poker Devices Control Law or other
applicable gaming laws (the "Applicable Laws") necessary for the Company to
obtain and hold all Louisiana gaming licenses necessary for the operation of its
video poker casino, or, in the case of Xxxxxxxx (or such transferees), Xxxxxxxx
(or such transferees) ceases to be a Louisiana resident:
6.5.1 XXXXXXXX' LOSS OF SUITABILITY. In the event Xxxxxxxx (or
his transferees under Section 6.4, as applicable) fails to continue to meet the
suitability requirements under Applicable Laws or ceases to be a Louisiana
resident, then the provisions of Section 6.5.3 shall immediately become
applicable and Xxxxxxxx (or such transferee) shall be referred to as the
"Nonsuitable Member" in Section 6.5.3 and NAMGC shall be referred to as the
"Other Member" in Section 6.5.3.
6.5.2 NAMGC'S LOSS OF SUITABILITY. In the event NAMGC fails to
continue to meet the suitability requirements under Applicable Laws, then the
provisions of Section 6.5.3 shall
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immediately become applicable and NAMGC shall be referred to in Section 6.5.3 as
the Nonsuitable Member and Xxxxxxxx (or such transferees) shall be referred to
individually and collectively as the Other Member.
6.5.3 BUY-SELL PROCEDURES. Upon the occurrence of the situation
described in Section 6.5.1 or Section 6.5.2, as applicable, so that this Section
6.5.3 becomes applicable, the Nonsuitable Member shall have the right to
contest, in accordance with applicable administrative and judicial process, at
its or his expense, the determination by the applicable governmental authority
that the Nonsuitable Member has become unsuitable, or the Nonsuitable Member may
accept such determination. Upon the acceptance of such determination (without
contest, or during the administrative and judicial process), or at the
conclusion of the applicable administrative and judicial process at which time
the determination of unsuitability was upheld, whichever occurs first, the
Nonsuitable Member shall have thirty (30) days (or such shorter period of time
if required by law or mandated by applicable governmental authorities) to sell,
gift or otherwise transfer such Nonsuitable Member's Membership Interests and
Sharing Ratios to a transferee who meets the suitability requirements of
Applicable Laws, who must also be a Louisiana resident if Xxxxxxxx (or his
transferee) is the Nonsuitable Member, at such price as may be negotiated
between the Nonsuitable Member and the person or entity to whom the Nonsuitable
Member's Membership Interests and Sharing Ratios will be assigned (the
"Assignee"); provided, however, that the Other Member must give his or its
consent to the transfer to the Assignee and to the Assignee becoming a Member
hereunder, which consent may not be unreasonably withheld; and, provided,
further, that if the Other Member objects and withholds consent, such Other
Member must deliver along with his or its written objection the specific
detailed reasons for objecting to such Assignee and the reasons why the Other
Member believes such reasons satisfy the requirement that the consent has been
withheld in the exercise of "reasonable" discretion. If the Nonsuitable Member
believes that such reasons do not constitute a "reasonable" objection, the
Nonsuitable Member shall be entitled to object by written notice to the Other
Member giving the reasons therefor, and if the Nonsuitable Member and Other
Member shall not be able to agree within five (5) days whether the Assignee is
acceptable or not acceptable, the Nonsuitable Member shall not transfer the
Membership Interests and Sharing Ratios to such proposed Assignee, but shall
retain all rights and remedies, including for damages, which he or it may have
against Other Member if the rejection by the Other Member is ultimately
determined not to have been reasonable. Notwithstanding the foregoing, if the
Other Member has rejected a proposed Assignee, the Nonsuitable Member shall have
the opportunity to present other proposed Assignees who will be reviewed by the
Other Member in accordance with this Section 6.5.3, until expiration of the
thirty (30) days (or such shorter period of time if required by law or mandated
by applicable governmental authorities).
If the Other Member does not object to the proposed Assignee, or objects
but the Nonsuitable Member and Other Member are able to agree that such proposed
Assignee is acceptable during the five (5) day period referenced above, the
Nonsuitable Member shall be entitled to transfer his or its Membership Interests
and Sharing Ratios to the proposed Assignee, which transfer must be effective
prior to the expiration of the thirty (30) day period (or shorter period
required by law or dictated by the governmental authorities) referenced in the
preceding paragraph, and upon closing thereof, the
12
Assignee shall take such Membership Interests and Sharing Ratios fully subject
to the terms and conditions of this Agreement and shall execute a written
instrument acknowledging such fact and agreeing to be bound by all of the terms
and conditions of this Agreement. Upon satisfaction of the foregoing, the
Assignee shall be considered a Member hereunder.
In the event the Nonsuitable Member shall not be able to find a proposed
Assignee, or the Other Member objects to such proposed Assignee in the exercise
of reasonable discretion, or the closing of the transfer to the Assignee does
not take place within the required time period noted in the preceding paragraph,
the Other Member shall have the right to locate a suitable purchaser of the
Nonsuitable Member's Membership Interests and Sharing Ratios for a period of
ninety (90) days after the expiration of the thirty (30) day period referenced
in the first paragraph of this Section 6.5.3 to locate a purchaser (including,
but not limited to the Other Member, himself or itself) who meets the
suitability requirements under Applicable Law and the Nonsuitable Member hereby
agrees to sell his or its Membership Interests and Sharing Ratios to such
purchaser at a purchase price equal to two (2) times the Nonsuitable Member's
allocable share of the net operating income of the Company for the preceding
calendar year, with such purchase price to be paid in cash prior to expiration
of said ninety (90) day period.
6.6 RIGHT OF MEMBERS TO SELL MEMBERSHIP INTERESTS AND SHARING RATIOS.
Each Member shall have the absolute right to sell his or its Membership Interest
and Sharing Ratios to any person or entity at such price and upon such terms and
conditions as may be agreed between the selling Member ("Selling Member") and
such person or entity, upon compliance with the terms and conditions of this
Section 6.6. Further, NAMGC shall have the right to assign the Consulting and
Administrative Agreement (referenced in Section 8.17) to such person or entity
upon such terms and conditions as may be negotiated between NAMGC and such
purchaser or entity.
In order for the Selling Member to be able to sell his or its Membership
Interests and Sharing Ratios, and for NAMGC to assign the Consulting and
Administrative Agreement if it is the Selling Member, the Selling Member must
give written notice to the other Member (the "Other Member") that the Selling
Member plans to sell his or its Membership Interests and Sharing Ratios (and
assign the Consulting and Administrative Agreement, if applicable) to a proposed
purchaser (the "Purchaser") at least thirty (30) days prior to consummation of
the proposed sale. The Other Member shall then be required within fifteen (15)
days following receipt of such notice of proposed sale to consent to the
Purchaser purchasing the Selling Member's Membership Interests and Sharing
Ratios (and the Consulting and Administrative Agreement, if applicable) and to
such Purchaser becoming a Member hereunder, which consent may not be
unreasonably withheld. In the event the Other Member objects in writing and
withholds consent within said fifteen (15) day period, such Other Member must
deliver along with his or its written objection the specific detailed reasons
for objecting to such Purchaser becoming a Member, and/or such Purchaser
becoming an assignee under and assuming the Consulting and Administrative
Agreement, if applicable, and the reasons why the Other Member believes such
reasons satisfy the requirement that the consent has been withheld in the
exercise of "reasonable" discretion. If the Selling Member believes that such
reasons do not constitute a "reasonable" objection, the Selling Member shall be
entitled to object by written notice
13
to the Other Member giving the reasons therefor, and if the Selling Member and
Other Member shall not be able to agree within five (5) days whether the
Purchaser is acceptable or not acceptable as a Member, or as an assignee under
the Consulting and Administrative Agreement, if applicable, the Selling Member
(i) shall not transfer the Membership Interests and Sharing Ratios to such
proposed Purchaser if that was the objection; or (ii) may sell the Membership
Interests and Sharing Ratios to such proposed Purchaser if the Other Member did
not object, but not assign the Consulting and Administrative Agreement to such
proposed Purchaser if that was the objection; or (iii) may elect not to transfer
the Membership Interest and Sharing Ratios to such proposed Purchaser or assign
the Consulting and Administrative Agreement because said assignment was objected
to by the Other Member; but the Selling Member shall retain all rights and
remedies, including for damages, which he or it may have against the Other
Member if the rejection by the Other Member of either the transfer of Membership
Interests and Sharing Ratios or the assignment of the Consulting and
Administrative Agreement, as applicable, is ultimately determined not to have
been reasonable.
If the Other Member does not object to the proposed Purchaser, or objects
but the Selling Member and Other Member are able to agree that such proposed
Purchaser is acceptable during the five (5) day period referenced above, the
Selling Member shall be entitled to transfer his or its Membership Interests and
Sharing Ratios to the proposed Purchaser, and NAMGC shall be entitled to assign
the Consulting and Administrative Agreement to such Purchaser if allowed under
the preceding paragraph, and upon closing thereof, the Purchaser shall take such
Membership Interests and Sharing Ratios fully subject to the terms and
conditions of this Agreement and shall execute a written instrument
acknowledging such fact and agreeing to be bound by all of the terms and
conditions of this Agreement. Upon satisfaction of the foregoing, the Purchaser
shall be considered a Member hereunder. Further, at such closing, NAMGC shall
assign the Consulting and Administrative Agreement to such Purchaser who shall
assume all of the rights, responsibilities and duties of NAMGC thereunder, and
NAMGC shall be released from any further responsibilities, duties, obligations
or obligations thereunder.
7. DISPUTE RESOLUTION
7.1 AGREEMENT TO USE PROCEDURE. The Members have formed the Company in
good faith and in the belief that it is mutually advantageous to them. It is
with that same spirit of cooperation that they pledge to attempt to resolve any
dispute amicably without the necessity of litigation. Accordingly, they agree if
any dispute arises between them relating to the Company (the "Dispute"), they
will first utilize the procedures specified in this section (the "Procedure")
prior to the commencement of any legal action.
7.2 INITIATION OF PROCEDURE. The party seeking to initiate the Procedure
(the "Initiating Party") shall give written notice to the other party,
describing in general terms the nature of the Dispute, the Initiating Party's
claim for relief and identifying one or more individuals with authority to
settle the Dispute on such party's behalf. The party receiving such notice (the
"Responding Party") shall have five (5) business days within which to designate
by written notice to the Initiating Party, one or more individuals with
authority to settle the Dispute on such party's behalf. (The individuals
14
so designated shall be known as the "Authorized Individuals".)
7.3 DIRECT NEGOTIATIONS. The Authorized Individuals shall be entitled to
make such investigation of the Dispute as they deem appropriate, but agree to
promptly, and in no event later than thirty (30) days after the date of the
Initiating Party's written notice, meet to discuss resolution of the Dispute.
The Authorized Individuals shall meet at such times and places and with such
frequency as they may agree. If the Dispute has not bee resolved within thirty
(30) days from the date of their initial meeting, the parties shall cease direct
negotiations and shall submit the Dispute to mediation in accordance with the
following procedure.
7.4 SELECTION OF MEDIATOR. The Authorized Individuals shall have five (5)
business days from the date they cease direct negotiations to submit to each
other a written list of acceptable qualified attorney-mediators not affiliated
with any of the parties. Within five (5) days after the date of receipt of such
list, the Authorized Individuals shall rank the mediators in numerical order of
preference and exchange such rankings. If one or more names are on both lists,
the highest ranking person shall be designated as the mediator. If no mediator
has been selected under this procedure, the parties agree jointly to request a
State or Federal District Judge of their choosing to supply within ten (10)
business days a list of potential qualified attorney-mediators. Within five (5)
business days after receipt of the list, the parties shall again rank the
proposed mediators in numerical order of preference and shall simultaneously
exchange such list and shall select as the mediator the individual receiving the
highest combined ranking. If such mediator is not available to serve, they shall
proceed to contact the mediator who was next highest in ranking until they are
able to select a mediator.
7.5 TIME AND PLACE FOR MEDIATION. In consultation with the mediator
selected, the parties shall promptly designate a mutually convenient time and
place for the mediation, and unless circumstances require otherwise, such time
to be not later than (45) days after selection of the mediator.
7.6 EXCHANGE OF INFORMATION. In the event any party to this Agreement has
substantial need for information in the possession of another party to this
Agreement in order to prepare for the mediation, all parties shall attempt in
good faith to agree on procedures for the expeditious exchange of such
information, with the help of the mediator if required.
7.7 SUMMARY OF VIEWS. At least seven (7) days prior to the first
scheduled session of the mediation, each party shall deliver to the mediator and
to the other party a concise written summary of its views on the matter in
Dispute, and such other matters required by the mediator. The mediator may also
require that a confidential issue paper may be submitted by each party to him.
7.8 PARTIES TO BE REPRESENTED. In the mediation, each party shall be
represented by an Authorized Individual and may be represented by counsel. In
addition, each party may, with permission of the mediator, bring such additional
persons as needed to respond to questions, contribute information and
participate in the negotiations.
15
7.9 CONDUCT OF MEDIATION. The mediator shall determine the format for the
meetings, designed to assure that both the mediator and the Authorized
Individuals have an opportunity to hear an oral presentation of each party's
views on the matter in dispute, and that the Authorized Individuals attempt to
negotiate a resolution of the matter in dispute, with or without the assistance
of counsel or others, but with the assistance of the mediator. To this end, the
mediator is authorized to conduct both joint meetings and separate private
caucuses with the parties. The mediation session shall be private. The mediator
will keep confidential all information learned in private caucus with any party
unless specifically authorized by such party to make disclosures of the
information to the other party. The parties agree to sign a document agreeing
that the mediator shall be governed by such rules as the mediator shall
prescribe. The parties commit to participate in the proceedings in good faith
with the intention of resolving the Dispute if at all possible.
7.10 TERMINATION OF PROCEDURE. The parties agree to participate in the
mediation procedure to its conclusion. The mediation shall be terminated (i) by
the execution of a settlement agreement by the parties, (ii) by a declaration of
the mediator that the mediation is terminated, or (iii) by a written declaration
of a party to the effect that the mediation process is terminated at the
conclusion of one full day's mediation session. Even if the mediation is
terminated without a resolution of the Dispute, the parties agree not to
terminate negotiations and not to commence any legal action or seek other
remedies prior to the expiration of five (5) days following the mediation.
Notwithstanding the foregoing, any part may commence litigation within such (5)
day period if litigation could be barred by an applicable statute of limitations
or in order to request an injunction to prevent irreparable harm.
7.11 FEES OF MEDIATOR; DISQUALIFICATION. The fees and expenses of the
mediator, shall be shared equally by the parties. The mediator shall be
disqualified as a witness, consultant, expert or counsel for any party with
respect to the Dispute and any related matters.
7.12 CONFIDENTIALITY. Mediation is a compromise negotiation for purposes
of the Federal and State Rules of Evidence and constitutes privileged
communication under Louisiana law. The entire mediation process is confidential,
and no stenographic, visual or audio record shall be made. All conduct,
statements, promises, offers, views and opinions, whether oral or written, made
in the course of the mediation by any party, their agents, employees,
representatives or other invitees and by the mediator are confidential and
shall, in addition and where appropriate, be deemed to be privileged. Such
conduct, statements, promises, offers, views and opinions shall not be
discoverable or admissible for any purposes, including impeachment, in any
litigation or other proceeding involving the parties, and shall not be disclosed
to anyone not an agent, employee, expert, witness, or representative of any of
the parties; provided, however, that evidence otherwise discoverable or
admissible is not excluded from discovery or admission as a result of its use in
the mediation.
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8. MISCELLANEOUS
8.1 TAXES.
8.1.1 FISCAL YEAR. The fiscal year of the Company shall begin on
January 1st.
8.1.2 TAX RETURNS. The Manager, if any, or if not the Members
shall cause to be prepared and filed all necessary federal and state tax returns
and make all elections necessary or appropriate.
8.1.3 BASIS ADJUSTMENT. If a distribution of the Company property
as described in Section 734 of the Code occurs or if a transfer of Membership
Interests and Sharing Ratios as described in Section 743 of the Code occurs, on
the written request of any Member, the Company shall elect to adjust the basis
of Company properties pursuant to Code Section 754.
8.1.4 PARTNERSHIP TAXATION. Neither the Company, any Manager nor
any Member may make an election for the Company to be excluded from the
application of the provisions of Subchapter K (Partners & Partnership) of
Chapter 1 (Normal Taxes & Surtaxes) of Subtitle A (Income Taxes) of the Code or
any similar provisions of applicable state law.
8.2 REPORTS. On or before the 60th day following the end of each fiscal
year during the term of the Company, the Manager, if any, or if not, the
Members, shall cause each Member to be furnished with a balance sheet, an income
statement, and a statement of changes in the Members' capital of the Company
for, or as of the end of, that year prepared by a firm of certified public
accountants. These financial statements must be prepared in accordance with
accounting principles generally employed for tax-basis records consistently
applied (except as therein noted), unless required otherwise by NAMGC to satisfy
its financial reporting requirements under applicable securities laws.
8.3 ACCOUNTS. The Managers, if any, or if not, the Members, shall
establish and maintain one or more separate bank and investment accounts and
arrangements for Company funds in the Company name with financial institutions
and firms that the Members determine by vote of Members owning 65% of the
Sharing Ratios. The Company's funds shall not be commingled with the funds of
any Members.
8.4 CERTIFICATES OF OWNERSHIP.
8.4.1 CERTIFICATES. Numbered certificates of ownership may be
issued to each Member certifying the Member's Sharing Ratio in the Company as of
the date of issuance. Each Certificate shall contain the following:
"Notice is hereby given that the sale, transfer, or other disposition
of the Membership Interests and Sharing Ratios represented by this
Certificate is
17
subject to the terms, conditions and restrictions contained in the
Operating Agreement, a copy of which is on file in the Company's
office."
8.4.2 LOST CERTIFICATES. A new certificate may be issued in
place of any Certificate previously issued upon receipt of an affidavit or bond
acceptable to the Company which indemnifies the Company against any claim which
may be made against it on account of the replacement of the Certificate.
8.4.3 TRANSFER OF CERTIFICATES. Certificates are transferable
only in accordance with the Articles of Organization and this Operating
Agreement.
8.5 NO PARTICIPATION. Except as provided in that certain Operating
Agreement, as amended, of OM Operating, L.L.C. to which NAMGC and Xxxxxxxx are
parties, no Member shall be entitled by virtue of being a Member in the Company
to participate in any other business or venture pursued by the other Member,
even if competitive with the business of the Company, and no Member owes a
fiduciary duty or any other duty to the other Member or to the Company, to
present any other business or opportunity to such Member, or to the Company, or
to allow them to participate therein, or to refrain from participating in any
such other business or venture or opportunity.
8.6 INDEMNIFICATION. Any person made a party to any civil or criminal
action, suit or proceeding by reason of the fact that he, his testator or
predecessor, is or was a Manager, Member, agent or officer of the Company, shall
be indemnified by the Company against the reasonable expenses, including,
without limitation, attorneys' fees and amounts paid in satisfaction of judgment
or in settlement, actually and reasonably incurred by him or imposed upon him in
connection with, or resulting from the defense of, such civil or criminal
action, suit or proceeding, or in connection with or resulting from any appeal
therein, if he acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful.
8.7 RECORD DATE. For the purpose of determining Members entitled to
notice of and to vote at a meeting, or to receive a distribution, or for any
other proper purpose, shall, if no other date is appropriate, for the purpose of
determining Members (i) entitled to notice of and to vote at a meeting, the
close of business on the day before the notice of the meeting is mailed, or if
notice is waived, the close of business on the day before the meeting, shall be
the record date for such purpose, or (ii) for any other purpose, the close of
business on the day on which the resolution relating thereto shall be adopted.
8.8 INSURANCE. No Manager or Member shall have any power or incident of
ownership over any life insurance policy insuring their life owned by the
Company. If life insurance is owned by the Company, any Member other than the
Member whose life is insured may exercise all rights in connection therewith.
18
8.9 INTERPRETATION. Whenever the legislature has declared that any
provision of law is applicable unless the Articles or Operating Agreement
provide otherwise, such provision of law shall be deemed applicable unless
negated or amended by provisions in the Articles or in the Operating Agreement
or unless the applicability of such provision would clearly frustrate the
provisions in the Articles or Operating Agreement.
8.10 NOTICE. Any notice or other communication required or permitted
hereunder shall be in writing, and shall be deemed to have been given if placed
in the United States mail, certified, return receipt requested, postage prepaid,
or if personally delivered, addressed to the latest address of the addressee
appearing in the records of the Company. Each of the foregoing shall be
entitled to specify a different address by giving written notice thereof as
hereinabove provided.
8.11 HEADINGS. Section and paragraph headings are not to be considered
part of this Operating Agreement, are included solely for convenience and are
not intended to be full or accurate descriptions of the content thereof.
8.12 FURTHER ASSURANCES. In connection with this Operating Agreement, each
Member shall execute and deliver any additional documents and instruments and
perform any additional acts that may be necessary or appropriate to effectuate
and perform the provisions of this Operating Agreement.
8.13 WAIVER OF CERTAIN RIGHTS. Each Member irrevocably waives any right it
may have to maintain any action for dissolution or for partition of the property
of the Company.
8.14 INDEMNIFICATION. To the fullest extent permitted by law, each Member
shall indemnify the Company, each Manager and each other Member and hold them
harmless from and against all losses, costs, liabilities, damages, and expenses
(including, without limitation, costs of suit and attorney's fees) they may
incur on account of any breach by that Member of this Operating Agreement.
8.15 AMENDMENT. The Members by unanimous vote only may amend or alter any
provision of this Operating Agreement or the Company's Articles of Organization.
8.16 EMPLOYMENT AGREEMENT WITH XXXXXXXX. The Company is hereby authorized
to enter into the Amendment to Employment Agreement (herein so called) with
Xxxxxxxx and OM Operating, L.L.C. ("OM"), dated of even date herewith, in the
form attached hereto as Exhibit "B" pursuant to which the Company will pay to
Xxxxxxxx a pro rata portion of the salary of $250,000 per year payable by OM to
Xxxxxxxx under the existing Employment Agreement dated April 15, 1998 between
Xxxxxxxx and OM, together with a pro rata portion of the benefits payable by OM
to Xxxxxxxx thereunder, such pro rata portion to be based on the number of truck
stop video poker casinos being operated by each of OM and the Company.
Thereafter, there shall be no employment agreement between the Company and
Xxxxxxxx unless NAMGC approves the terms and conditions thereof, including the
salary. As part of the Amendment to Employment Agreement dated of even
19
date herewith, Xxxxxxxx shall be reimbursed for reasonable expenses incurred by
him on behalf of the Company or in furtherance of his obligations under the
Amendment to Employment Agreement.
8.17 CONSULTING AND ADMINISTRATIVE AGREEMENT. The Company is hereby
authorized to enter into the Consulting and Administrative Agreement with NAMGC
and OM dated as of the date of this Operating Agreement in the form attached
hereto as Exhibit "C".
8.18 BEST EFFORTS TO RETAIN LICENSES. NAMGC and Xxxxxxxx agree to take
such actions as is deemed reasonably necessary by NAMGC, Xxxxxxxx or the Company
to aid the Company in retaining or obtaining any gaming, liquor or other
licenses of the Company required to operate in Louisiana.
8.19 RIGHT TO INSPECT BOOKS AND RECORDS. Each of the Members and their
representatives shall have the right to inspect and make copies from all books
and records of the Company at any time upon reasonable notice to the Company.
9. DISSOLUTION
9.1 EVENTS CAUSING DISSOLUTION. The Company shall dissolve upon the
occurrence of any of the following events unless the Members unanimously vote to
continue the Company:
9.1.1 The expiration of the term of the Company or any extension
or renewal thereof.
9.1.2 Upon the written agreement of Members owning 100% of the
Sharing Ratios, or upon the occurrence of any event stated herein to cause a
dissolution.
9.1.3 Upon the entry of a decree of judicial dissolution under the
Act.
9.2 WINDING UP AND LIQUIDATION ON DISSOLUTION OF THE COMPANY. Upon the
dissolution of the Company, its business shall be wound up as rapidly as
business circumstances will permit. The liquidation of the assets of the Company
and the winding up of its affairs shall be concluded pursuant to the terms of
the Act by the Managers.
9.3 DISTRIBUTION OF ASSETS ON LIQUIDATION. Upon the dissolution of the
Company, all of the assets of the Company, or the proceeds of sales, if any, of
the Company assets and all other cash and property, if any, then on hand in the
Company, shall be applied and distributed as follows:
9.3.1 All of the valid and binding debts and obligations of the
Company and the expenses of its termination and the settlement of its affairs
(other than debts, if any, owed to any Member) shall be paid or adequately
provided for within the period which the liquidating Manager(s) shall deem
advisable (but not exceeding the later of (i) the end of the taxable year in
which the liquidation occurs, or (ii) ninety (90) days after the date of such
liquidation); provided, however, that
20
nothing contained herein shall be construed as an agreement of the Company or
the Members to pay any debt, liability, or obligation which pursuant to the
terms of the instrument(s) creating such debt, obligation, or liability, it and
its Members have no personal liability to pay; and
9.3.2 The remaining assets of the Company, including cash, liquid
investments, notes, bonds, obligations of third parties, other receivables, if
or to the extent owned by the Company on the date of dissolution, shall then be
allocated and distributed in kind to the Members in accordance with Capital
Account balances (after Capital Accounts have been adjusted to reflect all
profits and loss allocations), in the priorities set forth in Section 4.3
hereof.
THUS DONE AND SIGNED by North American Gaming and Entertainment Corporation
in Dallas, Texas, on July __, 1998.
WITNESSES NORTH AMERICAN GAMING AND
ENTERTAINMENT CORPORATION
By:
---------------------- --------------------------------
X. X. Xxxxx, XX, President
----------------------
----------------------
NOTARY PUBLIC
THUS DONE AND SIGNED by Xxxxxx X. Xxxxxxxx in ______________, Louisiana on
July __, 1998.
WITNESSES
---------------------- ---------------------
XXXXXX X. XXXXXXXX
----------------------
---------------------
NOTARY PUBLIC
21
RIVER PORT TRUCK STOP, L.L.C.
EXHIBIT "A"
MEMBER INITIAL CONTRIBUTION SHARING RATIO
------ -------------------- --------------
North American Gaming and $49.90 49.9 %
Entertainment Corporation
Xxxxxx X. Xxxxxxxx $50.10 50.1%
22
EXHIBIT B
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ( "Amendment") is made and entered
into effective as of July __, 1998, by and between River Port Truck Stop, L.L.C.
("River Port"), OM Operating, L.L.C. ("OM") and Xxxxxx X. Xxxxxxxx ("Xxxxxxxx")
and constitutes a new agreement between River Port and Xxxxxxxx and an amendment
to the existing Employment Agreement (herein so called) dated April 15, 1998
between Xxxxxxxx and OM.
1. Xxxxxxxx hereby agrees to provide the same services to River Port as
he is providing to OM under the Employment Agreement, provided the amount of
time expended by him shall be split between River Port and OM based on the
number of truck stop video poker casinos operated by each of them from time to
time.
2. OM shall be responsible for paying a pro rata portion of all
compensation and benefits payable to Xxxxxxxx under the Employment Agreement,
based on the number of truck stop video poker casinos operated by each of them
from time to time, and River Port shall pay the remainder of such compensation
and benefits.
3. River Port shall have all of the rights, duties and responsibilities
with respect to Xxxxxxxx and the truck stop video poker casino operated by River
Port as are set forth for OM in the Employment Agreement, and Xxxxxxxx shall
have all of the rights, duties and responsibilities with respect to River Port
and the truck stop video poker casino operated by River Port as are set forth
for OM in the Employment Agreement.
Executed effective as of the date and year first above written.
RIVER PORT TRUCK STOP, L.L.C.
By:
---------------------------------
Xxxxxx X. Xxxxx, Manager
OM OPERATING, L.L.C.
By:
---------------------------------
Xxxxxx X. Xxxxx, Manager
---------------------------------
Xxxxxx X. Xxxxxxxx, Individually
23
EXHIBIT C
CONSULTING AND ADMINISTRATIVE AGREEMENT
This Consulting and Administrative Agreement ( the "Agreement") is made and
entered into effective as of July __, 1998, by and between North American Gaming
and Entertainment Corporation ("Consultant") and River Port Truck Stop, L.L.C.
(the "Company").
Consultant and the Company hereby incorporate by reference into this
Agreement that certain Consulting and Administrative Agreement (the "OM
Consulting Agreement") entered into effective as of April 15, 1998 by and
between Consultant and OM Operating, L.L.C. ("OM") and hereby agree that
Consultant shall perform the same services for the Company related to its truck
stop video poker casino as Consultant is performing for OM under the OM
Operating Agreement, and that the Consultant and the Company shall have the same
rights, duties, responsibilities and obligations to each other as the Consultant
and OM have to each other under the OM Operating Agreement as fully as if the
full OM Operating Agreement were restated herein and executed by Consultant as
the "Consultant" thereunder and by the Company as the "Company" thereunder,
except that the fee payable by the Company to Consultant under this Agreement
shall be an annual fee of $50,000 per year for as long as the Company is
constructing, or owns or operates, its truck stop video poker casino. Without
limiting the foregoing, Consultant and the Company hereby agree that the term of
this Agreement shall be the same term as set forth in the OM Operating
Agreement.
Executed effective as of the date and year first above written.
RIVER PORT TRUCK STOP, L.L.C.
By:
---------------------------------
Xxxxxx X. Xxxxx, Manager
NORTH AMERICAN GAMING AND
ENTERTAINMENT CORPORATION
By:
---------------------------------
Its:
---------------------------------
24
