EXHIBIT 10.2

 

CONTRIBUTION AGREEMENT

 

Southwest Casino Corporation (“Southwest”) and each of the parties listed as a
co-signer or guarantor on Exhibit 1 (the “Co-Signers”) enter into this
Contribution Agreement (the “Agreement”) effective March 7, 2008. Each of the
Co-Signers or guarantors is referred to individually as a “Co-Signer” and
collectively as the “Co-Signers”.

 

BACKGROUND

 

A.            Under the terms of Subscription Agreements dated the same date as
this Agreement, each of the Co-Signers has agreed to co-sign a promissory note
(each, a “Note” and collectively, the “Notes”) or a guarantee (each a
“Guarantee” and collectively the “Guarantees”) in favor of Crown Bank (the
“Bank”).

 

B.            Southwest and the Co-Signers wish to enter into an arrangement
under which Southwest agrees to repay certain amounts to Co-Signers and the
Co-Signers agree to indemnify each other for any amounts paid by a Co-Signer
under a Note or a Guarantee that exceeds that Co-Signer’s Pro Rata Portion of
the Aggregate Contribution Amount (as those terms are defined in this
Agreement).

 

AGREEMENT

 

In consideration of the above premises and the mutual covenants in this
Agreement, the Co-Signers agree as follows:

 

Section 1.  Technical Default.  If any Co-Signer makes payment to the Bank based
upon a technical default under a Note or Guarantee, Southwest agrees that it
will repay to Co-Signer all amounts paid by Co-Signer to the Bank on the same
terms and conditions as the terms of the Note issued by the Bank.  For purposes
of this Agreement, a technical default means any default that results from any
event or circumstance other than the failure or inability of Southwest to make a
payment on a Note when due.

 

Section 2.  Contribution and Subrogation.  The Co-Signers agree that, to the
extent that any Co-Signer (a “Claiming Co-Signer”) makes a payment as a
co-signer of a promissory note or under a Guaranty (a “Claim”), the other
Co-Signers will indemnify the Claiming Co-Signer for the total amount paid by
the Claiming Co-Signer under a Note, a Guaranty, and to other Claiming
Co-Signers under this Section 2, if applicable, that exceeds the Claiming
Co-Signer’s Pro Rata Portion of the Aggregate Contribution Amount at the time of
that Claim.  Except, that each Co-Signer’s obligation to indemnify a Claiming
Co-Signer under this Section 2 will only arise to the extent that the total
amount paid by that Co-Signer, whether under a Note, a Guaranty or to other
Claiming Co-Signers under this Section 2, is less than that Co-Signer’s Pro Rata
Portion of the Aggregate Contribution Amount at the time of such Claim.  For the
purposes of this Agreement, (i) a Co-Signer’s “Pro Rata Portion” means the
percentage determined by dividing the original principal amount of the
promissory note or guaranty signed by a co-signer divided by the total principal
amount of all Notes and Guarantees executed by the Co-Signers, and (ii) the
“Aggregate Contribution Amount” means the aggregate amount paid by all of the
Co-Signers under the Notes and Guaranties.

 

Any Co-Signer making a payment to a Claiming Co-Signer under this Section 2 will
be subrogated to the rights of that Claiming Co-Signer to the extent of that
payment.

 

Section 3.  Termination.  This Agreement will survive and be in full force and
effect until all of the Notes and Guaranties are indefeasibly and forever fully
released and discharged.

 

 

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Section 4.  Miscellaneous.

 

4.1           ASSIGNMENT; SUCCESSORS AND ASSIGNS.  NONE OF THE CO-SIGNERS CAN
ASSIGN OR OTHERWISE TRANSFER THEIR RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT,
EXCEPT WITH THE PRIOR WRITTEN CONSENT OF ALL OF THE CO-SIGNERS.  THIS AGREEMENT
BINDS EACH PARTY TO THIS AGREEMENT AND THEIR RESPECTIVE HEIRS AND PERMITTED
SUCCESSORS AND ASSIGNS AND INURES TO THE BENEFIT OF THE PARTIES TO THIS
AGREEMENT AND THEIR RESPECTIVE HEIRS AND PERMITTED SUCCESSORS AND ASSIGNS.

 

4.2           AMENDMENT.  THIS AGREEMENT MAY NOT BE DEEMED OR CONSTRUED TO BE
MODIFIED OR AMENDED, IN WHOLE OR PART, OTHER THAN BY WRITTEN AMENDMENT SIGNED BY
ALL OF THE PARTIES TO THIS AGREEMENT.

 

4.3           SEVERABILITY.  IF ANY TERM OR PROVISION OF THIS AGREEMENT IS
INVALID OR UNENFORCEABLE, THAT TERM OR PROVISION WILL BE DEEMED STRICKEN FROM
THIS AGREEMENT.  THE INVALIDITY OR UNENFORCEABILITY OF ANY TERM OR PROVISION OF
THIS AGREEMENT WILL NOT INVALIDATE THIS AGREEMENT, AND THE REMAINING TERMS AND
PROVISIONS OF THIS AGREEMENT WILL CONTINUE IN FULL FORCE AND EFFECT.

 

4.4           WAIVER.  NO FAILURE BY ANY PARTY TO TAKE ANY ACTION OR ASSERT ANY
RIGHT UNDER THIS AGREEMENT WILL BE DEEMED TO BE A WAIVER OF ANY RIGHTS OR
REMEDIES UNDER THIS AGREEMENT OR AT LAW.

 

4.5           GOVERNING LAW; JURISDICTION.  THIS AGREEMENT MUST BE CONSTRUED,
INTERPRETED AND GOVERNED ACCORDING TO THE LAWS OF THE STATE OF MINNESOTA.  ANY
LITIGATION INSTIGATED IN CONNECTION WITH THIS AGREEMENT MUST BE VENUED IN EITHER
THE DISTRICT COURTS OF HENNEPIN COUNTY, MINNESOTA, OR THE UNITED STATES DISTRICT
COURT FOR THE DISTRICT OF MINNESOTA, FOURTH DIVISION.

 

4.6           COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN TWO OR MORE
COUNTERPARTS, EACH OF WHICH WILL BE DEEMED AN ORIGINAL AND ALL OF WHICH WILL
CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

Remainder of Page Intentionally Blank.

Signatures on Next Page.

 

 

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Signature Page for

Contribution Agreement

 

IN WITNESS WHEREOF, the parties to this Agreement have executed this instrument
as of the day and year first above written.

 

 

CO-SIGNER:

CO-SIGNER:

 

 

 

Print Name:

 

 

Print Name:

 

 

CO-SIGNER:

CO-SIGNER:

 

 

 

Print Name:

 

 

Print Name:

 

 

CO-SIGNER:

CO-SIGNER:

 

 

 

Print Name:

 

 

Print Name:

 

 

CO-SIGNER:

CO-SIGNER:

 

 

 

Print Name:

 

 

Print Name:

 

 

CO-SIGNER:

CO-SIGNER:

 

 

 

Print Name:

 

 

Print Name:

 

 

CO-SIGNER:

CO-SIGNER:  (GUARANTOR):

 

 

 

Print Name:

 

 

Print Name:

James B. Druck

 

CO-SIGNER:  (GUARANTOR):

CO-SIGNER:  (GUARANTOR):

 

 

 

Print Name:

Thomas E. Fox

 

Print Name:

Jeffrey S. Halpern

 

SOUTHWEST CASINO CORPORATION

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

Its:

 

 

 

 

 

 

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