Document:

Exhibit
10.36

 

GAMING
MANAGEMENT AGREEMENT

 

THIS
AGREEMENT, made and entered into this 24th day of
March, 2006, at Red Rock, Oklahoma, by and between the
OTOE-MISSOURIA TRIBE OF INDIANS, a federally recognized Indian Tribe
organized pursuant to Section 3 of the Act of June 26, 1936 (49 Stat. 1967) by
and through its duly elected Otoe Missouria Tribal Council (hereinafter
referred to as “Tribe”), and SOUTHWEST CASINO AND
HOTEL CORP., a Minnesota corporation with its principal place of
business located in Minneapolis, Minnesota (hereinafter referred to as “Manager”).

 

W I T N E
S S E T H

 

WHEREAS,
Tribe desires to become involved with Manager in the operation of Class II
gaming and Class III gaming as authorized by compact with the State of Oklahoma
(the “Enterprise” as more fully defined below) at the location described on
Exhibit A to this Agreement and any new location(s) that may be agreed upon
between Tribe and Manager (collectively referred to as the “Facilities”); and

 

WHEREAS,
Tribe is committed to the use of gaming activities as a primary means of
economic development and financial support for tribal programs and essential
governmental services; and

 

WHEREAS,
Tribe desires to contract for the management services of Manager in order to
assure that the Enterprise is well managed, marketed and sufficiently funded
for all refurbishing and/or expansion costs, equipping, staffing and training
of all employees; and

 

WHEREAS,
Manager agrees to assist the Tribe in its efforts to refurbish, expand, equip
and staff the Facilities, and provide the management experience necessary to
conduct successful Tribal gaming operations under the terms and conditions
stated more fully in this agreement; and

 

IT IS
THEREFORE AGREED by the parties to this Agreement, that Tribe
offers to hire Manager, and Manager accepts Tribe’s offer to be employed as
contract manager to manage the Enterprise under the terms and conditions and
for the consideration more fully described in this Agreement.

 

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ARTICLE I

 

DEFINITIONS

 

As used in this
Agreement, the following terms have the meanings stated below:

 

1.1          “Affiliate”
means, in the case of the Manager, any entity that controls, is controlled by,
or is under common control with the Manager and any employee, officer, director
or agent of Manager or any such entity.

 

1.2          “Claim” means
any dispute or claim between any Tribal Party and the Manager or an affiliate
of the Manager, which is directly or indirectly related to the Enterprise,
assets of the Enterprise, the Facilities, or this Agreement, whether arising
under law or in equity, whether arising as a matter of contract or a tort, and
whether arising during or after the term of this Agreement.

 

1.3          “CPA” means
an accounting firm of regional or national recognition selected by Tribal
Representative.

 

1.4          The “Enterprise”
is the commercial enterprise of the Tribe authorized to engage in (a) gaming of
every variety defined as Class II Gaming by the Indian Gaming Regulatory Act of
1988, as amended (the “Act”);
(b) gaming of every variety that is authorized by compact with the State of
Oklahoma (which may be defined as Class III Gaming under the Act); and (c) any
other lawful commercial activity allowed on the Facilities. The Tribe will have
the sole proprietary interest in and responsibility for the conduct of all
Gaming Operations (as defined below) conducted by the Enterprise, subject to
the rights and responsibilities of the Manager under this Agreement.

 

1.5          “Facilities”
means all improvements at the location described on Exhibit A and any new
locations that may be agreed to between Tribe and Manager (which will be added
to Exhibit A by amendment), including any parking areas and drives used for
ingress and egress at such location or locations, it being understood that the
term “Facilities” is intended to envelop all gaming operations and supporting
facilities of the Tribe at the location or locations described in Exhibit A to
this Agreement.

 

1.6          “Gaming
Commission” means the legislative body established under the
laws of the Tribe with jurisdiction to oversee the Enterprise on behalf of the
Tribe, and to contract for the construction and operation of any enterprise,
including the Enterprise that is contemplated in this Agreement.

 

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1.7          “Gaming
Operation” or “Gaming” means the economic entity that is
licensed by the Tribe, operates the games, receives the revenues, issues the
prizes, and pays the expenses.

 

1.8          “Gaming Related
Operating Expenses” means those expenses, (excluding Management
Fees), calculated in accordance with generally accepted accounting principles
(GAAP), necessary for the Gaming Operation, including the following:  (1) repayment of interest on loans, secured
with the assistance of Manager or otherwise, to the Tribe pursuant to this
Agreement; (2) the payment of salaries, wages, benefit programs, and training
for employees of the Gaming Operation, including Manager’s Representative
defined in Section 3.2.A of this Agreement and the Tribal Coordinator defined
in section 3.2.B of this Agreement, and contract labor or services retained on
behalf of the Gaming Operation; (3) materials and supplies for the Gaming
Operation; (4) utilities; (5) the cost of fire protection, emergency medical services
and law enforcement; (6) interest on installment contract purchases or
lease-type financing by the Gaming Operation; (7) insurance and bonding; (8)
advertising and marketing, including busing and transportation of employees
and/or customers to the Facilities and including such portion of any loss
realized from non-gaming operations determined by Manager and Tribe to be a
proper allocation to the marketing budget subject to the budget agreed upon by
the Manager and Tribal Council; (9) fees, costs, dues and contributions
associated with Tribal and Gaming Operation membership and participation in
trade associations and related associations; (10) security costs and background
checks of employees of the Gaming Operation; (11) reasonable travel expenses for
officers of the Manager to inspect and oversee the Gaming Operation, and for
the Chairman of the Tribe and members of the Tribal Council and key employees
of Tribe when such travel is reasonably related to the Gaming Operation,
subject to the budget agreed upon by the Manager and the Tribal Council; (12)
trash removal; (13) costs of goods sold; (14) other expenses designated as
Operating Expenses in the annual budget of the Gaming Operation as approved by
the Tribal Council and Manager; (15) professional fees and expenses, including
legal and accounting fees incurred on behalf of the Gaming Operation; (16)  National Indian Gaming Commission (“NIGC”)
fees; (17) amortization of start-up expenses; (18) any federal, state or Tribal
taxes or assessments which are properly assessed against the Gaming Operation;
(19) reasonable costs incurred by the Tribe in regulating the Gaming Operation;
(20) Rental payments; and (21)

 

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reasonable accruals established by Manager after consultation with
Tribe to provide for future payment of operating expenses and jackpot type
prizes.

 

1.9          “General Manager” means the person
selected by Manager and approved by the Tribal Representative, who is
experienced in the operation, maintenance and accounting for a Gaming Operation.
The General Manager will be selected by, and under the direct supervision of,
the Manager and is the person responsible for, and empowered with the necessary
authority for, carrying out the duties and responsibilities of Manager stated
in this Agreement in connection with the operation of the Facilities. The
General Manager will be an employee of the Enterprise and will be engaged
during the term of this Agreement.

 

1.10        “Management Agreement” and “Agreement” means this
Agreement.

 

1.11        “Net Revenues”
means gross gaming revenues of the Gaming Operations less (a) amounts paid out
as, or paid for, prizes; and (b) total Gaming-Related Operating Expenses,
excluding management fees.

 

1.12        “Non-Gaming Net
Revenues” means gross revenues from all non-gaming sources
including, without limitation, restaurant and food service (including the sale
of alcoholic beverages, if any, and excluding tribal industries such as tobacco
sales or gift shop, if any), less total non-gaming related operating expenses
calculated in accordance with generally accepted accounting principles (GAAP).

 

1.13        “Project Approval”
means approval by the Chairman of the NIGC of this Gaming Management Agreement
and authorization by Manager to conduct Class II Gaming (as defined in the Act)
and, as authorized by compact with the State of Oklahoma, Class III Gaming.

 

1.14        “Tribal
Land” means any property which may in the future, or which
presently fits within the definition of “Indian Land” in Noble County, Oklahoma,
for purposes of establishing tribal or federal jurisdiction and regulatory
authority over gaming activities.

 

1.15        “Tribal Party”
means the Otoe-Missouria Tribe of Indians, and any subdivision, agency,
department, board, committee, commission, instrumentality, subdivision, or
entity owned or controlled, in whole or in part, directly or indirectly, by the
Otoe-Missouria Tribe of Indians.

 

1.16        “Tribe”
means the Otoe-Missouria Tribe of Indians.

 

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1.17        “Tribal
Representative” means the Chairman of the Tribe, or his or her
designee, appointed in accordance with this Agreement. The Tribe may, in its
sole discretion, delegate any Tribal Representative functions to the Tribal
Council.

 

1.18        “Tribal
Gaming Commission” means the body of the Tribe authorized to
regulate the Gaming Operation pursuant to the adopted tribal gaming ordinance.

 

ARTICLE II

 

EMPLOYMENT
OF MANAGER

 

2.1          General Responsibilities of Manager.
Tribe retains and engages Manager commencing on the Effective Date (as defined
in Section 18.8 of this Agreement). Manager’s responsibilities include
assisting Tribe with the renovation of existing or other desirable locations
and facilities for conducting Class II gaming and Class III gaming as authorized
by compact with the State of Oklahoma, both within and outside the Tribe’s last
reservation boundary, including remodeling, expanding, equipping the Facilities
with gaming equipment and machinery, staffing, staff training, marketing and
promotion and the funding of an initial house bank sufficient to begin
operation and safely cover all initial wagers and payouts. Manager will
establish an adequate advertising and marketing budget and will place all
necessary advertising. Manager will have the exclusive right to manage the
Facilities on behalf of Tribe in compliance with (i) the terms of this
Agreement; (ii) the Act or other applicable Tribal and/or Federal law; (iii)
the gaming compact between the Tribe and the State of Oklahoma; and (iv) the
tribal gaming ordinance. Manager will maintain and provide food and beverage
services for patrons of the Facilities. Such food and beverage services will be
maintained and accounted for separately. Manager will promptly pay all bills of
the Gaming Operation when they become due with funds of the Gaming Operation. Manager,
after consultation with the Tribal Representative, will establish a schedule
during which the Facilities will be open for business. Manager will use actual
market experience after opening to ascertain whether the schedule needs to be
modified after taking into consideration the cost of operation during any given
period and the revenues to be expected during that same period. This Agreement
will not transfer or, in any other manner, convey any interest in land or other
real property.

 

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2.2          Renovating, Expanding and Equipping
the Facilities. After Effective Date of this Agreement,
the Tribal Representative, on behalf of the Tribe with the direction and assistance
of Manager, will undertake all steps necessary to renovate and equip the
Facilities, and if agreed upon between the Tribe and Manager, expand or build
additional Facilities. Manager will submit all renovation, expansion and
equipment plans to the Gaming Commission for final approval before
implementation. If applicable, the Manager will supply the NIGC with all
information necessary for the Gaming Commission to comply with the NIGC’s
regulations issued pursuant to the National Environmental Policy Act in
connection with any renovation or expansion plans. Further, any contracts
pertaining to the renovations or equipping of the Facilities will also require
the final approval of the Tribal Representative.

 

2.3          Alcoholic Beverages and Tobacco
Sales. During the term of this Agreement, no alcoholic
beverages will be served on the Property unless the Gaming Commission, on
behalf of the Tribe, decides otherwise and unless the serving of such beverages
is otherwise in accordance with applicable law. Revenues from, and the
management of, the sale of alcoholic beverages will be under Manager’s
supervision and aggregated with other food and beverage revenues in the
calculation of Net Non-Gaming Revenues under this Agreement. Tobacco may be
sold at the Gaming Operation by the Tribe if such sale is in accordance with
the provisions of applicable law and with any agreements between the Tribe and
any agency of the Tribe or other government authority. The revenues of any
tobacco sales will be revenues of the Tribe, exclusively, and all tobacco
operations will be under the direction of the Tribe; however, the employees
must meet the standards imposed by Manager on other employees of the Gaming
Operation.

 

2.4          Security Force.
Manager will be responsible for providing a security force sufficient to
reasonably assure the safety of the customers, personnel, monies, and property
of the Gaming Operation. Such security force will be comprised of security
officers employed directly by the Tribe, who will report directly to the Manager,
and each security officer will be bonded in sufficient amounts commensurate
with their enforcement duties and obligations. The cost of such security force
will be included in the Operating Expenses of the Gaming Operation.

 

2.5          Responsibilities of the Tribe. Tribe
agrees to promulgate appropriate Tribal gaming laws and regulations by which
Manager can be guided and by which Tribe will exercise the required Tribal
control and regulatory authority over its gaming industry. Tribe agrees to
refrain from the promulgating or

 

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enforcing of laws or the assessing or collecting of taxes on the
operation of the Facilities or Manager, including all profit centers and
activities in the Facilities which, in the judgment of Manager, might serve to
reduce the benefits of this Agreement to Manager during the term of this
Agreement. If any such law or assessment exists or is duly promulgated, Tribe,
by this Agreement, exempts the Gaming and related business activities of the
Facilities from that law or assessment for the term of this Agreement and
waives payment and enforcement of same. Any such change of law or regulation
will be applicable to the subject Facilities during the term of this Agreement
only with the written consent of Manager. If the Tribe imposes a tax, fee or
other charge in contravention of this Section, the Tribe will be obligated to
reimburse Manager within seventy-two (72) hours. If the Tribe fails to
reimburse Manager within seventy-two (72) hours of such imposition, Manager
will be entitled to deduct the amount of the required reimbursement from the
Tribe’s share of Net Revenues otherwise distributable under Section 6.1 of this
Agreement.

 

2.6          Term of Agreement. This
Agreement will be for a term of 5 years commencing on the date the Facilities
are first opened for business under the management of Manager. If Manager
assists the Tribe in obtaining financing and constructing a new Facility or new
Facilities, the term of this Agreement will be 7 years commencing on the date
that new Facility is first opened for business.

 

ARTICLE
III

 

EMPLOYEES
AND OPERATIONS

 

3.1          Personnel. All
employees of the Facilities will be considered Tribal employees assigned to the
Facilities under the authority and supervision of Manager. Subject to the
provisions of Section 3.1.D, all responsibility for employment decisions,
including, but not limited to, the hiring, firing, promotion, transfer,
compensation and discipline of employees will, however, be the sole
responsibility of Manager, who will make such decisions in accordance with the
rules, regulations, policies and procedures and prudent employment practices
established by Manager and reasonably approved by Tribe for use in the
operation of the Facilities. Tribe agrees not to attempt to influence
employment decisions based on political or family relationships.

 

3.1.A      Tribal Hiring Preference. The
parties to this Agreement agree that preference will be given to qualified
Tribal members for all available and vacant positions of employment with the

 

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Facilities. Next preference will be given to qualified Native American
persons who are not Tribal members. Final determination of the qualifications
of Tribal members and all other employees for employment will be made by
Manager.

 

3.1.B      Hiring Process. Tribe
will maintain a file of current applications of Tribal members who desire to be
considered for employment in the Gaming Operation. At such time as a vacancy or
opening occurs, or is anticipated to occur by Manager, Manager will request
such applications be delivered by Tribe for consideration. If no qualified
applicants are available, then Manager may at its discretion choose to hire a
non-Tribal member of Manager’s choice.

 

The parties agree that
adequate education and experience are an absolute requirement for placement in
many management and supervisory positions that will be required for the
operation of the Facilities. In addition, specific training and experience will
be required for persons selected to fill other non-management positions. Every
reasonable effort will be made to place Otoe-Missouria tribal members in middle
level and top-level managerial positions. The Manager will be prepared to give
clear explanations upon request of Tribe as to the finding that tribal members
who otherwise meet the minimum standards for employment are not hired. Manager
will establish such training activities as may be necessary to maintain an
adequately skilled work force for the Facilities.

 

3.1.C      Emergency Hiring. Manager
may, at its discretion, declare any key position that becomes vacant to be an
emergency vacancy for immediate employment of any person who Manager deems to
be competent in education, training and/or skills required to perform
satisfactorily in the subject position. Any such position must be one which in
Manager’s opinion or judgment an extended vacancy would cause substantial loss
of revenue, quality of service, or otherwise jeopardize the level of
performance and thus the reputation of the Facilities.

 

3.1.D      Security Clearance and Background
Reviews. Tribe will conduct an adequate background
review, as is necessary and appropriate to the responsibilities of each
position to be filled within the Facilities, of each employee of the Facilities.
This background review must be sufficient to meet the requirements of the Act
and regulations promulgated under the Act, the tribal compact, the tribal
gaming ordinance and such reasonable regulations as may be promulgated by the
Tribe. The background investigation procedures employed by the Tribe will be
formulated in consultation with

 

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Manager and must satisfy all regulatory requirements. The cost of
background reviews will be an Operating Expense of the Gaming Operation, and
Manager will cooperate and assist Tribe where necessary in obtaining the
information necessary to adequately carry out this task. If Tribe does not
approve the hiring of any person, that person will not be employed by Manager
at the Gaming Operation.

 

3.2          Manager’s Representative. Manager
will appoint and hire as its representative on site the General Manager who
will serve in the capacity generally described below:

 

3.2.A      General Manager
of the Facilities with primary authority over all other employees, and who will
make, or delegate to an appropriate staff-member responsibility and authority
to make all day-to-day business decisions required at the Facilities. The
General Manager will have ultimate authority over such delegated tasks and will
adequately supervise and monitor same to secure the successful exercise of such
authority by her or his staff.

 

3.2.B      Compensation of General Manager. The
position described in paragraph 3.2.A of this Agreement, as with all other
employment positions within the Gaming Operation, will provide compensation by
salary, pay scale and other appropriate and desirable compensation and benefits
as are appropriate to the responsibilities of that position, and that is
competitive in the gaming and recreation industry. If the originally appointed
person is not able, or chooses not to serve in this capacity, Manager will have
the sole authority for the selection of any replacement of its appointee with a
qualified person of Manager’s choice.

 

3.3          Security. Manager
will select and employ, on behalf of the Enterprise, personnel to reasonably
insure the safety and security of the Facilities (including any parking lots or
garages) and guests, employees and the handling of monies related to the Gaming
Operation or any other revenue center within or connected to the Facilities,
including a Director of Security who will report to the General Manager on site
and will provide a copy of any written report directly to Manager. Manager will
work toward establishing a security force of a high level of training and
expertise. All reports and information from the Director of Security will be
made immediately available to the Gaming Commission as established under the
Tribal Gaming Ordinance. Manager will also pay the cost of any increased public
safety services required for the Gaming Operation. All expenses of these
security activities will be an Operating Expense of the operation of the
Facilities, including professional training, uniforms,

 

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transportation and any arms or other equipment reasonably necessary, in
the judgment of Manager, to the proper fulfillment of the responsibilities of
the security force.

 

3.4          Limited Appointment of Manager as
Agent of Tribe. This Agreement does not transfer any
interest in the Property to Manager. Manager, however, is appointed, delegated,
employed and authorized to act on behalf of Tribe as Tribe’s agent in carrying
out a variety of duties necessary to the proper and efficient management and
operation of the Facilities on behalf of Tribe as follows:

 

3.4.A      Operation of General Business and
Business Affairs. Manager will manage the day-to-day
operation of the Facilities, including, but not limited to, the general
business and business affairs in connection with the improvement, operation,
equipping, management and maintenance of the Facilities, management of real
estate and all improvements to the property set aside for the use of Manager
and for the operation of the Facilities. In carrying out these duties and
responsibilities, Manager promises and agrees to comply with the letter and
spirit of this Agreement, its terms and conditions. Manager is not authorized
or empowered to obligate Tribe or to pledge tribal assets to secure any debt or
obligation of the Gaming Operation and is not authorized to enter into a lease
or deed for real property.

 

3.4.B      Management and Control.
Manager will have the exclusive authority over, and right to control of, the
day-to-day management and control of the Gaming Operation and all non-gaming
activities (other than tobacco sales, if any), its employees, customers,
revenues and any and all property and assets assigned, located or otherwise
used at or for the Facilities. This authority includes all decisions regarding
games played and the rules of play for such games, the odds or payouts of such
games, and the profit margins to be used in the sale of any goods or services
to be sold on the premises, all in compliance with the compact, the tribal gaming
ordinance, and/or industry standards. The control exercised by Tribe over the
Facilities and the Gaming Operation will be exercised through the tribal gaming
ordinance and regulations appropriately promulgated under the tribal gaming
ordinance, the terms of the compact, and the terms of this Agreement.

 

3.4.C      Collection, Deposit and
Disbursement of Revenues. As Tribe’s Agent, Manager will
collect, receive and account for, on behalf of Tribe, all revenues generated
and resulting from the operation of the Facilities. These revenues will be
deposited into an account or accounts of the Gaming Operation with the bank or
banks Manager may choose, with the approval of Tribe, with the sole

 

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signatories to be Manager or Manager’s duly authorized representatives
designated for those purposes. Manager is authorized to make all disbursements
and expenditures that are necessary from these account(s) in order to fund all
Gaming Operations and other expenses related to the Facilities, including, but
not limited to, Operating Expenses and non-gaming operating expenses; and the
disbursement of Net Revenues and Non-Gaming Net Revenues due Tribe and Manager.
All such expenditures and disbursements will be clearly represented within and
on the regular monthly financial statement or report provided by Manager to
Tribe as more specifically stated in this Agreement below.

 

ARTICLE
IV

 

ACCOUNTING
AND FINANCIAL REPORTING

 

4.0          Accounting. Manager
will provide for the establishment and maintenance of satisfactory accounting
systems and procedures that will, at a minimum: 
(a) include an adequate system of internal accounting controls; (b)
permit the preparation of financial statements in accordance with generally
accepted accounting principles; (c) be susceptible to audit; (d) allow the
Gaming Operation, the Tribe, and the Commission to calculate the annual fee
payable to the NIGC pursuant to 25 C.F.R Section 5.14.1; (e) permit the
calculation and payment of the Manager’s fee; and (f) provide for the
allocation of operating expenses or overhead expenses among the Tribe, the
Enterprise, the Manager, and any other user of shared facilities and services. Any
such allocation must be reasonable and acceptable to both Tribe and Manager.

 

4.1          Financial Records and Statements.
Manager will maintain full and accurate gaming operation records, including
books of account and records, upon the premises and provide access to Tribe or
Tribe’s delegated representative for the inspection of the gaming operation
records at any time to verify daily gross revenues and income from the
operation and the Tribe will have access to any other gaming related
information the Tribe deems appropriate. The books will be kept in compliance
with generally accepted accounting principles, and pursuant to the requirements
of the Act and the terms of any approved gaming compact. Manager will prepare
and provide to the Tribe comparative financial statements monthly, quarterly
and annually of all sales, revenues and all other amounts collected and
received, and all deductions and disbursements made from those amounts in
connection with the Gaming

 

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Operation and in conformance with the budget. An independent, qualified
Certified Public Accountant selected by the Tribal Representative after
discussions with the Manager will perform an annual audit of the Gaming
Operation and of all contracts for supplies, services or concessions for a
contract amount in excess of $25,000.00 annually (except contracts for
professional legal or accounting services) reflecting Operating Expenses as
defined in this Agreement. The costs incurred for the audits will be an
Operating Expense of the Gaming Operation. The Gaming Commission will provide
the audits, on behalf of the Tribe, to all appropriate governmental agencies,
as required by law, and may be used by Manager for reporting purposes under
Federal and State securities laws, if required.

 

4.1.A      Accountant. Manager
will employ, as an Operating Expense, a bookkeeper, accountant or accounting
firm to oversee the performance of the accounting tasks required to meet the
requirements of this agreement, and in order to assist Manager with the
financial information needed to fully and properly carry out the general duties
and responsibilities of Manager under this Agreement. Manager will design and
install systems for insuring the security of all funds and maintain and police
these systems at a minimum each quarter. The person or firm so retained by Manager
will be independent from the CPA defined in paragraph 1.1 of this Agreement.

 

4.1.B      Daily Reports. Manager
will ensure the capacity to determine the daily revenues, including the gross
handle and hold of the Facilities, and will communicate these daily results to
the Tribe.

 

4.1.C      Financial Reporting.
Manager will provide separate accountability, and at a minimum quarterly
financial reporting, for all non-gaming profit centers that exist within the
Facilities or that may be otherwise related to the Facilities, such as
restaurants, hotels or otherwise.

 

4.1.D      Deposit of Proceeds. Proceeds
from all non-gaming profit centers will be deposited and secured by Manager for
deposit at the bank or banks selected by Manager and Tribe.

 

4.1.E       Cash Management System.
Manager will establish a cash management system that is adequate to safeguard
the funds of the Gaming Operation. The Tribe will have the right to oversee the
cash management system, including video surveillance.

 

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4.1.F       Tax Withholdings on Winnings.
Manager will be responsible for reporting and withholding taxes with respect to
the winnings from gaming or wagering operations as may be required by the
Internal Revenue Code of 1986, as amended.

 

4.1.G      Internal Revenue Code. Manager
will be responsible for compliance with all other lawful requirements imposed
by the Internal Revenue Code.

 

4.2          Depositories and Accounts.
Manager will, as agent for Tribe, establish sufficient bank accounts as are
deemed necessary and appropriate to the proper management and control of all
revenues generated upon the Facilities. Manager and Tribe will mutually
determine the depositories to be used for these purposes.

 

4.2.A      Tax Identification Number.
Manager will use a separate Tax Identification Number as opposed to the Tribal
Tax Identification Number for any or all accounts of the Enterprise as a means
of insuring against any and all claims of third parties, including creditors or
state and federal authorities who make any claim against Manager. The use of
the separate Tax Identification Number for the Enterprise will not change or
reduce the authority of Manager over the use or disbursement of the monies as
otherwise authorized by this Agreement.

 

4.2.B      Change of Depository.
With the consent of the Tribal Representative, Manager may from time to time
change the depositories used for the Facilities, but will be required to give
Tribe notice of Manager’s intent so to do no less than 20 days before any such
change in depositories. Failure of the Tribe to object within that 20-day
notice period will be deemed to be approval of the change in depositories. The
notice will contain a full and complete statement of the reason for the change
and the basis upon which the selection of the new depository was made.

 

ARTICLE V

 

REVENUES,
PROFITS AND TAXES

 

5.1          Determination of Net Revenues and
Non-Gaming Net Revenues. For the purposes of determining
Net Revenues in order to calculate the proper distribution of profits between
Tribe and Manager, Net Revenues are defined in paragraph 1.9 of this Agreement
and Non-Gaming Net Revenues are defined in Paragraph 1.10 of this Agreement.

 

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5.2          Distribution of Profits.
The distribution of profits will be made within 20 days of the close of each
calendar month, after calculation of Net Revenues and Non-Gaming Net Revenues
by Manager and after a report of those calculations and the resulting
distribution plan is delivered to Tribe. All payments to the Tribe of its share
of Net Revenues and Non-Gaming Net Revenues or its guaranteed payment will be
deposited as instructed, in writing, from time to time. Tribe and Manager will
bear the burden of any loss for non-gaming operations in the following ratio:
80% Tribe and 20% Manager. Any such loss will be deducted from Net Revenues
before payment of Management Fees or disbursement of Net Revenues to Tribe.

 

5.2.A      Objections to Calculations.
Any objection or difference of opinion that Tribe might have with the manner of
calculation will be the subject of good faith negotiation between the parties.

 

5.2.B      Waiver of Objections.
Tribe will endeavor to review the reports referred to in paragraph 5.2 above
promptly. Failure of Tribe to raise any such objection within 60 days of
receipt of the distribution report will result in the waiver by Tribe of any
objections, unless Manager has failed to adequately report income and expense
or has failed to properly calculate the distributions; and, in the absence of
fraud, Tribe is prohibited from making such objections after that 60 day
period.

 

5.2.C      Miscalculation. If
it is determined as a result of timely objection by Tribe that Manager is
indebted to Tribe for miscalculation or otherwise, Tribe will be entitled to
repayment of the amounts determined to be owed with interest at the current
treasury bond rate at the time the determination is made and entered. Likewise,
any debt or judgment awarded Manager against Tribe will earn interest at the
same rate. In either case, awards may be paid immediately or out of future Net
Revenues and Non-Gaming Net Revenues. Terms of repayment will be negotiated in
good faith by the parties to this Agreement. Upon failure of the parties to
agree, the terms will be established by the Tribal Gaming Commission.

 

5.3          Fiduciary Relationship of Manager
to Tribe. In the carrying out of Manager’s duties and
responsibilities under this Agreement, Manager acts as the fiduciary of Tribe
and will be held to the traditional standards of a fiduciary.

 

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ARTICLE
VI

 

COMPENSATION
AND REIMBURSEMENT

 

6.0          Facility Rental Payment. Manager shall pay to Tribe the amount of
$128,000.00 per month for the rental of said facilities due on or before
the 20th day of each month beginning the first month of operation
under this Agreement. Said rental
payment shall be a Gaming-Related Operating Expense.

 

6.1          Management Fee.
In consideration of the performance of the duties and obligations assumed by
Manager under this Agreement, Tribe agrees that Manager will receive
compensation equal to the sum of (i) 20 percent of all Net Revenues, plus (ii)
20 percent of all Non-Gaming Net Revenues, generated from the Gaming Operation
located at the Facilities managed under this Agreement by Manager. If Manager
assists the Tribe in obtaining financing and constructing a new Facility, Tribe
agrees that Manager will receive compensation equal to the sum of (i) 25
percent of all Net Revenues, plus (ii) 25 percent of all Non-Gaming Net
Revenues, generated from the Gaming Operation located at the Facilities managed
under this Agreement by Manager. After payment of the Management Fee to
Manager, remaining Net Revenue and Non-Gaming Net Revenues will be paid to
Tribe. Management Fees will be calculated monthly and adjusted annually. The
annual adjustment will be reviewed and confirmed by the CPA.

 

6.2          Guaranteed Payment to Tribe.
Manager agrees that, beginning 90 days after the date of the first day the
Facilities are opened for business under the management of Manager, the Tribe
will receive a minimum monthly distribution of Net Revenue under Section 5.2 of
this Agreement of $25,000.00 (the “Monthly Guaranteed Payment”), the first
payment due on or before the 20th day of the first full month of
operation of the Facilities after the 90 day period ends and due on or before
the same date of each month thereafter throughout the term of this Agreement,
without regard to the profitability of the Facilities and preference over
retirement of development and construction costs.

 

6.3          Final Distribution.
Upon termination or expiration of this Agreement, Manager will be entitled to
receive from the Tribe, cash equal to 20 percent of the Gaming Operation
undistributed Net Revenues and Non-Gaming Net Revenues, except, if Manager
assists the Tribe in obtaining financing and constructing a new Facility,
Manager will be entitled to receive from the Tribe cash equal to 25 percent of
the Gaming Operation undistributed Net Revenues and Non-Gaming Net Revenues.

 

15

 

ARTICLE
VII

 

NOTICE

 

7.1          Notices. Any
notice required under this Agreement must be delivered by certified mail
addressed to Tribe at:

 

Otoe-Missouria Tribe of
Indians

8151 Highway 177

Red Rock, Oklahoma
74651-0348

Attn: Chairman

 

addressed to Attorney
General:

 

Kennis M. Bellmard, Esq.

Andrews Davis, P.C.

100 N. Broadway, Suite
3300

Oklahoma City, OK 73102

 

and to the Manager at:

 

Southwest Casino and
Hotel Corp.

c/o Thomas E. Fox,
President

2001 Killebrew Drive,
Suite 306

Minneapolis, Minnesota
55425

 

and to NIGC at:

 

National Indian Gaming
Commission

1850 M Street N.W., Suite
250

Washington, D.C. 20036

 

ARTICLE
VIII

 

WARRANTIES
AND REPRESENTATIONS

 

8.1          Warranties and Representations.
The parties to this Agreement warrant and represent to each other that they
will each act responsibly to promptly request the approval of this Agreement by
the proper federal agency or commission; that they will take no action against,
nor fail to take appropriate action to secure, the approval of this Agreement. Neither
party will attempt to alter the terms of this Agreement without the written
consent of the other, nor will they attempt to make assignment or transfer of
their rights in whole or in part under this Agreement to any third party. Tribe
warrants to Manager that Tribe exempts the Gaming Operations conducted at the
Facilities from any ordinance or regulation which will, by virtue of the
enforcement of that ordinance or regulation, effectively amend or modify the
terms of

 

16

 

this Agreement, or in any way reduce the benefits to Manager from this
Agreement whether presently existing or hereafter promulgated.

 

ARTICLE IX

 

GROUNDS FOR TERMINATION

 

9.1          Breach by Manager.
This Agreement may be terminated upon the written consent and approval of both
parties, or by the Tribe if any principal, employee or agent of Manager is
found guilty of theft or embezzlement of monies or assets of the Tribal Gaming
Operation. For purposes of this section, a principal of Manager will be defined
as James B. Druck, Thomas E. Fox or Brian L. Foster However, upon final
determination of guilt, Manager may terminate the principal, employee or agent
of Manager and make restitution for the amount lost and thereby preclude Tribe’s
right to terminate. This Agreement may also be terminated by a final judgment
of a court of competent jurisdiction as a result of a finding of a material
breach of this Agreement. Subject to Manager’s ability to cure any shortfall by
restitution as provided above, it is specifically understood and agreed that
this Agreement may be terminated by the Tribe if Manager fails to make any
payment to the Tribe when due without good cause or reasonable explanation for
the failure to make payment when due (it being understood that mistake,
inadvertence or other negligent error will constitute “reasonable explanation”
under this Agreement), which will be considered a material breach of this
Agreement. A material breach of this Agreement will include, but not be limited
to, a failure of either party to perform any material duty or obligation on its
part for any 20 consecutive days. However, neither party may terminate this
Agreement on grounds of material breach unless it has provided written notice
to the other party of its intention to declare a default and to terminate this
Agreement, and the defaulting party thereafter fails to cure or take steps to
substantially cure the default within 60 days following receipt of such notice.
The discontinuance or correction of the material breach will constitute a cure
of that breach. In the event of any termination for cause, regardless of fault,
the parties will retain all monies previously paid to them under Article 6
(Compensation and Reimbursement) of this Agreement; and the Tribe will retain
title to all Gaming Operation facilities, fixtures, improvements, supplies,
equipment, funds and accounts (collectively, the “Gaming Operation Assets”),
subject to the rights of any third party lender under any Loan Agreements relating
to the acquisition or

 

17

 

financing of all or any portion of the Gaming Operation Assets. Notwithstanding
the foregoing, to the extent Manager has, at the time of the termination, Net
Revenues due under Article 6 of this Agreement, such Net Revenues will be paid
to Manager promptly upon termination.

 

9.2          Tribal Breach.
If this Agreement is terminated due to a breach by Tribe, Manager will not be
required to perform any further services under this Agreement and the Gaming
Commission and the Tribe will indemnify and hold Manager harmless against all
liabilities of any nature whatsoever relating to the Gaming Operation or
created by the termination of this Agreement. Any Net Revenues on hand at the
time of termination will be distributed in accordance with Article 6 of this
Agreement. Manager and the Tribe acknowledge and agree that termination of this
Agreement may not be a sufficient or appropriate remedy for breach, and further
agree that under the other provisions of this Agreement, as provided for in
Sections 17 and 18, Manager will have the right to pursue other remedies, at
law or equity and in addition to termination, as it determines are best able to
compensate it for that breach. Manager will specifically be entitled to recover
its share of Net Revenues for the period commencing on the date of any breach
by the Tribe and continuing through the remaining term of this Agreement. In
addition, the Tribe specifically acknowledges and agrees that there will be
irreparable harm and that full damages will be difficult to determine if the
Tribe commits any breach. An election to pursue damages or to pursue specific
performance of this Agreement or other equitable remedies while this Agreement
remains in effect will not preclude the injured party from providing notice of
termination under the provisions of this Section 9. Regardless of the remedy
selected, Manager will retain the right to repayment of amounts due under this
Agreement.

 

9.3          Involuntary Termination Due to
Changes in Applicable Law. It is the understanding and
intention of the parties that the establishment and operation of the Gaming
Operation contemplated in this Agreement conforms to and complies with all
applicable laws. If this Agreement, the Gaming Operation, any material aspect
of Gaming or any material aspect of any tribal compact is determined by the
Congress of the United States, the Department of the Interior, the NIGC, or the
final judgment of a court of competent jurisdiction to be unlawful under
Federal or State law, the obligations of the parties to this Agreement will
cease and this Agreement will be of no further force and effect, provided that:
(i) Manager and the Tribe will retain all monies previously paid to them under
Article 6 of this Agreement; (ii)

 

18

 

funds of the Gaming Operation in any account will be paid and
distributed as provided in Article 6 of this Agreement; and (iii) the Tribe
will retain title to all Gaming Operation facilities, fixtures, improvements,
supplies and equipment, subject to the rights of Manager under any security
agreement and subject to any requirements of financing arrangements.

 

9.4          Manager’s Rights to Terminate.
If conditions beyond the reasonable control of Manager occur, which in Manager’s
sole discretion cause Manager to believe that this Agreement cannot be
reasonably performed by either party, Manager may terminate this Agreement
without penalty at any time before the commencement of Gaming Operations at the
Facilities.

 

9.5          Dissolution, Insolvency or
Bankruptcy of Manager. If the Manager is dissolved,
executes any petition under the Bankruptcy Code, files for or is declared
bankrupt, becomes insolvent, ceases to function as a business entity, fails to
perform or otherwise is guilty of a material breach of this Agreement that
remains uncured for at least 30 after receipt of written notice of breach from
the Tribe, or if the Manager’s creditors cause to be executed any valid
petition under the Bankruptcy Code, then Manager’s rights under this Agreement
will cease and the agreement will terminate. An accounting will be made and
Manager or its successor or legal representative will be entitled to a pro rata
share of the profits earned to the date of insolvency or default and the right
to repayment of any loans, and will likewise be liable for any losses incurred
to that date.

 

ARTICLE X

 

INSURANCE

 

10.1        Public Liability Insurance.
The Manager will maintain public liability insurance in the amount of at least
$1,000,000 per person and $3,000,000 per occurrence. The Tribe will keep the
Facilities and all improvements and contents of the Facilities insured for
their full replacement value against loss or damage by fire, with extended
coverage endorsement and vandalism coverage. The exact nature and extent of
this coverage will be agreed upon by the parties, and In the event of
disagreement, an experienced and licensed appraiser will be hired to determine
the appropriate coverage. Each party will supply the other with satisfactory
written evidence of continuing insurance coverage in accordance

 

19

 

with this Article X on each anniversary date of this agreement. The
insurance premiums and appraisal costs will be an expense of the Gaming
Operation

 

ARTICLE
XI

 

SUCCESSORS
AND ASSIGNMENTS

 

11.1        Binding Effect.
The benefits and obligations of this Agreement will inure to and be binding
upon the parties to this Agreement and their respective successors and assigns,
provided that neither party may assign or sublease their interest in this
Agreement without prior written approval of the other party. Any assignment or
sublease under this Agreement will be subject to approval by the NIGC, and will
be preceded by a complete background investigation of the assignee or
sublessee.

 

ARTICLE
XII

 

RECORDATION

 

12.1        Recording of Agreement.
At the option of Manager, this Agreement may be recorded in any public records.

 

ARTICLE
XIII

 

NO
PARTNERSHIP

 

13.1        Nothing in this Agreement is intended to
create or constitute the parties as partners together, or one to the other, and
it is expressly agreed that this business relationship will not be a
partnership.

 

ARTICLE
XIV

 

ENTIRE
AGREEMENT

 

14.1        This Agreement represents the entire
management agreement between the Tribe and Manager, and supersedes all other
previous agreements, whether written or oral, that may have been entered into
previously.

 

20

 

ARTICLE
XV

 

NON-INTERFERENCE

 

15.1        As a material and substantial
consideration for the Tribe entering into this Agreement, Manager agrees that
neither Manager nor its agents and employees will interfere with or attempt to
influence internal affairs or governmental decisions of the Tribe with the exception
that Manager may choose to publicly or privately oppose any proposed act or
decision that in Manager’s opinion would be detrimental to the gaming activity
and profits to be earned from that activity.

 

ARTICLE
XVI

 

EXECUTION
IN MULTIPLE

 

16.1        This Agreement is being executed in five
originals, one copy to be retained by each party and three to be presented for
review of the appropriate Federal agency or commission. All are equally valid.

 

ARTICLE
XVII

 

DISPUTE
RESOLUTION: WAIVERS OF SOVEREIGN IMMUNITY AND TRIBAL COURT JURISDICTION

 

17.1        Dispute Resolution.
The parties agree that any Claim will be governed by the following dispute
resolution procedures:

 

17.1.A    Limited Waiver of Sovereign Immunity.
The parties acknowledge that the Tribe is a federally recognized Indian tribe
and that the Tribe and its instrumentalities possess sovereign immunity from
unconsented suit and other legal proceedings. Nothing in this Agreement may be
deemed to be a waiver of the Tribe’s sovereign immunity, except to the limited
extent expressly described in this Section 17.1.A and except as limited by
Section 17.1.B and 17.3. With respect to all Claims, the Tribe hereby
irrevocably waives the sovereign immunity of all Tribal Parties, and all
defenses based thereon, for the following limited purposes: (i) the
adjudication or enforcement of Claims in any federal court of competent
jurisdiction sitting in the State of Oklahoma (and all courts to which appeals
therefrom may occur); and (ii) the arbitration of Claims as provided in Section
17.1.E. Only Manager, an affiliate of

 

21

 

Manager and a Tribal Party are entitled to benefit from the limited
express waiver of sovereign immunity provided in this Section.

 

17.1.B    Limitation on Recourse.
Notwithstanding any other provision herein, any monetary award or judgment
against a Tribal Party with respect to a Claim may be enforced and collected
only as against (i) Net Revenues of the Enterprise; (ii) undistributed or
future proceeds of the Enterprise; and (iii) if it has been specifically found
that the Tribe has prejudiced Manager’s rights under this Agreement or
accompanying agreements, or has in any way caused the lack of business success
of the Gaming Operation, then the future proceeds of any other gaming
operations conducted by the Tribe at any other location. In no instance will
any enforcement of any kind whatsoever be allowed against any assets of the
Tribe other than the assets specified in this Section 17.1.B.

 

17.1.C    Waiver of Exhaustion of Tribal Remedies
Doctrine. In connection with any Claim, the Tribe
expressly waives the application of the doctrines of exhaustion of tribal
remedies, abstention, or comity and all other rights of the Tribe or any Tribal
Party that might otherwise require that a Claim be heard in a Tribal Court.

 

17.1.D    Obligation to Meet and
Confer. Neither party may commence any judicial or arbitration
proceeding without providing written notice of the pending commencement of such
proceedings to the other party no less than ten (10) days prior to such
commencement, during which time the parties must in good faith seek to meet and
confer to resolve the dispute without the need for commencement of judicial or
arbitration proceedings.

 

17.1.E     Rules and Location of Arbitration.
Claims not resolved during the meet-and-confer process referred to in Section
17.1.D. may, at the option of the Tribe or the Manager, be resolved in Oklahoma
by binding arbitration under the commercial arbitration rules of the American
Arbitration Association, without waiver of the Tribe’s sovereign immunity for
enforcement purposes in any Oklahoma State Courts. The Tribe hereby irrevocably
agrees that actions seeking to enforce or aid such arbitration may be entered
in Otoe CFR Court, and that such CFR Court must apply the same standards of
review as would be applied by federal courts in such circumstances sitting in
the State.

 

17.2        Governing Law. This
Agreement is governed by and construed in accordance with applicable federal
laws and the laws of the Tribe.

 

22

 

17.3        Resolution of Other Disputes.

 

17.3.A. Resolution
of Disputes between Manager and Customers of the Gaming Operation. Manager
will prescribe rules of play for each type of gaming that has been approved by
the Tribal Gaming Commission. These rules of play must be posted in plain view,
accessible and visible by all customers of the Gaming Operation. All games must
be conducted fairly and honestly by both Manager and customers. In the event of
a dispute between Manager and any customer, the written rules of play will
govern. However, Manager will strive to satisfy the customer in the resolution
of any dispute. The General Manager will be initially responsible to attempt to
resolve all such disputes. If a dispute cannot be resolved by the General
Manager, the General Manager will immediately submit a written report of the
dispute to both Manager and Tribal Representative who will discuss the dispute
with each other and with the customer. Manager will make the final
determination of the action to be taken to resolve the dispute, after
consulting with Tribal Representative, and Manager’s decision will be final. Any
customer who is not satisfied with the decision of Manager may appeal the
decision to the Tribal Gaming Commission.

 

17.3.B. Resolution
of Disputes Between Manager and Employees of the Gaming Operation. Manager
will prepare and submit to Tribal Representative a personnel manual, which will
describe all personnel policies, procedures, job classifications, salary
levels, disciplinary procedures and fringe benefits. The personnel manual will
be available to each employee. The manual will provide for establishment of a
Grievance Committee. The Grievance Committee will consist of the General Manager,
the Tribal Representative and a third person selected by Manager. The third
person may be the Director of Human Resources for either the Tribe, the Manager
or the Gaming Operation, or any other third person that is qualified in such
matters. The selection of the third person by Manager will be final. The
decision of the Grievance Committee will be final with respect to all disputes.

 

ARTICLE
XVIII

 

MISCELLANEOUS

 

18.1        Parties in Interest.
Manager agrees to have attached to this Agreement as Exhibit B, a list of all
parties in interest to the contract, including on behalf of the Manager, all
corporate officers, all stockholders of the corporation holding 5 percent or
more of the stock of the corporation, and all

 

23

 

employees presently hired who will have day-to-day management
responsibility for the Gaming Operations. Manager agrees to inform the Tribe,
in writing, of any change of parties in interest including all corporate
officers, directors and stockholders holding 5 percent or more of the stock of
the corporation. Manager agrees to inform the Tribe, in writing, of any change
in the ownership interest of Manager that results in a transfer of control of
more than 50 percent of the outstanding securities of Manager. If Tribe does
not consent to such change in control and the transfer occurs, Tribe may
terminate this Agreement in accordance with Section 9.

 

18.2        Parties’ Personal History Statements.
The list of parties in interest will include brief personal history statements
including their residence and business addresses, occupations, dates of birth
and social security numbers.

 

18.3        Corporate Documents and Authorization.
Manager will provide to Tribe its Articles of Incorporation and the Corporate
Resolution authorizing this Agreement.

 

18.4        Conflict of Interest.
Manager agrees that no person who has a financial interest in Manager will be
elected members of the Tribal government or a relative of an elected member of
the Tribal government. If any party in interest or a relative of a party in
interest is elected to the Tribal government, that person will be required to
divest himself or herself of his or her interest in the contract.

 

18.5        Limitation on Tribal Offices.
Manager agrees that, subject to the establishment of a different policy with
the Tribal Council, no elected member of the Tribal government, or relative
residing in the immediate household of an elected member of the Tribal
government, may be hired as an employee of the Manager or of the Gaming
Operation.

 

18.6        Relative. “Relative”
for these purposes means an individual who is related to an elected member of
the Tribal government as a father, mother, son, daughter, brother, sister,
uncle, aunt, first cousin, nephew, niece, husband, wife, father-in-law,
mother-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law,
stepfather, stepmother, stepsister, half brother or half sister.

 

18.7        No Payments. Manager
agrees that no payments have been and no payments will be made to any elected
member of the Tribal government or the relative of any elected member of the
Tribal government for the purpose of obtaining or maintaining the contract or
any other privilege for the Manager.

 

24

 

18.8        Effective Date.
The Effective Date of this Agreement means the date that the written approval
of this Agreement is granted by the NIGC pursuant to the Act. The Tribe agrees
to use its best efforts to satisfy all of the above conditions within 6 months
after the date of this Agreement.

 

18.9        Semi-Annual Meeting.
Manager will be available for a meeting at the Gaming Operation with the Gaming
Commission, Tribal Representative and Tribal Gaming Commission at least every 6
months during the term of this Agreement to discuss all matters relevant to the
Gaming Operation.

 

ARTICLE
XIX

 

DUTY TO
DEFEND, NOTICE OF CLAIMS, SELECTION OF COUNSEL

 

19.1        Defense of Claims.
It will be the duty of the Manager to defend any and all claims and actions
brought against Manager, the Facilities or Tribal gaming interests, with all
costs of defense, including but not limited to, attorneys’ fees, necessary and
reasonable expenses of the litigation, and expert witness fees to be considered
Operating Expenses of the gaming operations. These claims and actions will not
be limited by the nature or the amount of the claims unless otherwise
specifically stated in this Agreement, but will include only claims and actions
related to the duties and obligations of Manager under this Agreement and the activities
of Manager in the performance of its obligations under this Agreement.

 

19.2        Notice. Manager
will give prompt notice to Tribe of any and all claims or actions brought
against Manager, the Facilities, Tribal gaming interests or any persons acting
on behalf of any of the above, where such claim or action is related to the
Gaming Operation or the Facilities. Claims and actions, for purposes of this
Agreement, will include administrative, civil or criminal actions brought in
any forum or jurisdiction, including claims or actions brought before the
National Indian Gaming Commission under the Indian Gaming Regulatory Act of
1988 or any claims or notices issued from the Internal Revenue Service.

 

19.3        Duty to Defend.
Manager will be required to defend any and all claims described in Section 19.1
and to secure Tribal approval for hiring competent counsel in the defense of
the claims at the expense of the Gaming Operation. If the issues addressed in
any such action or claim are of a nature and magnitude that directly endangers
the Tribal governmental capacity of the Tribe, Tribal assets (other than

 

25

 

future earnings from the gaming operation) or other more substantial
Tribal interests, then Tribe may elect to select and provide counsel of its
choice to address those issues in order to insure and protect Tribe’s interests
in that action or claim. At the option of Manager, Manager may choose to
provide co-counsel to work in conjunction with Tribal counsel at the expense of
the gaming operation. Any and all costs relative to Tribal counsel’s
participation or assuming of responsibility over the greater issues raised in
such an action or claim, whether administrative or otherwise, will be an
expense to be shared equally between Tribe and the gaming operation, with no
more than one-half of said costs to be paid as an expense of operation of the
Facilities.

 

19.4        Tribal Attorney.
Manager will have the right to contract independently with Tribe’s attorney to
render any or all legal representation described in this Agreement, or Manager
will be entitled to select counsel with Tribal approval for any and all
representation, counsel, advice or other legal services reasonably related to
the fulfillment of Manager’s duties and obligations and the exercise of Manager’s
rights under this Agreement.

 

19.5        Legal Fees. Manager
will be responsible for any and all costs of legal representation obtained by
Manager for purposes other than carrying out its duties and responsibilities under
this Agreement, and no such other expenses or costs will be paid as an expense
of the Gaming Operation.

 

19.6        Indemnification. Manager
will be entitled to indemnification from the Gaming Operation for all
liabilities incurred and claims made arising in connection with Manager’s good
faith performance of duties under this Agreement. If the Tribe, Manager, any
contractor or subcontractor or any employees of the Gaming Operation are sued
by any person based on Tribal, State or Federal statute or law, Manager will
have the right to defend such action or actions on behalf of itself. The Tribe
agrees to defend itself and to fully cooperate in the defense. Nothing in this
Section 19.6 will be construed to waive or limit the Tribe’s sovereign
immunity.

 

ACKNOWLEDGMENT

 

The
OTOE-MISSOURIA TRIBE OF INDIANS, acting by and through its delegated
representative, Chairman C. Michael Harwell and SOUTHWEST
CASINO AND HOTEL CORP., by its                                              ,
hereby agree to the foregoing Management Agreement by and between the

 

26

 

OTOE-MISSOURIA TRIBE OF INDIANS and SOUTHWEST CASINO AND HOTEL CORP.
with an Effective Date defined in Section 18.8 of this Agreement.

 

IN WITNESS WHEREOF, we
have executed this instrument this 24th day of March, 2006.

 

	
   

  	
  OTOE-MISSOURIA TRIBE OF INDIANS

  
	
   

  	
  By and through its
  delegated

  
	
   

  	
  representative,
  Chairman C. Michael Harwell

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Secretary

  	
   

  
	
   

  	
   

  
	
   

  	
  SOUTHWEST CASINO AND HOTEL
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Printed Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
										

 

27

 

EXHIBIT A

 

LOCATIONS
INCLUDED IN DEFINED TERM “FACILITIES”

 

7 Clans Paradise Casino

7500 Highway 177

Red Rock, Oklahoma 74651

 

28Exhibit 10.1

 

PATENT PURCHASE AGREEMENT

 

This PATENT PURCHASE AGREEMENT (“Agreement”) is entered into on
November 21, 2005 (“Effective Date”) by and
between Mount Hamilton Partners, LLC with an office at 650 Castro Street, Suite
120-333, Mountain View, CA 94041 (“Purchaser”),
and eAcceleration Corp., a Delaware corporation with an address at 1050 NE Hostmark
St., Suite 100B Poulsbo, WA 98370 (“Seller”).  The parties hereby agree as follows.

 

	
  1.

  	
  BACKGROUND

  
	
   

  	
   

  
	
  1.1

  	
  Seller owns certain United States Letters Patents and/or applications
  for United States Letters Patents and/or related foreign patents and
  applications.  

  
	
   

  	
   

  
	
  1.2

  	
  Seller wishes to sell to Purchaser all right, title and interest in such
  patents and applications and the causes of action to sue for infringement
  thereof and other enforcement rights.

  
	
   

  	
   

  
	
  1.3

  	
  Purchaser wishes to purchase from Seller all right, title and
  interest in the Assigned Patent Rights (defined below), free and clear of any
  restrictions, liens, claims and encumbrances.

  
	
   

  	
   

  
	
  2.

  	
  DEFINITIONS

  
	
   

  	
   

  
	
  2.1

  	
  “Assigned Patent Rights”
  means Patents and the additional rights set forth in paragraph 4.2.

  
	
   

  	
   

  
	
  2.2

  	
  “Assignment Agreements”
  means the agreements assigning ownership of the Patents from the inventors
  and/or the prior owners to Seller.

  
	
   

  	
   

  
	
  2.3

  	
  “List of Prosecution Counsel”
  means the names and addresses of prosecution counsel who prosecuted the
  Patents and/or who are currently handling the Patents.

  
	
   

  	
   

  
	
  2.4

  	
  “Patents”
  means (i) each of the provisional patent applications, patents applications
  and patents listed on Exhibits A and B
  (as such lists may be updated based on Purchaser’s review of the
  Deliverables) hereto, (ii) all patents or patent applications to which any of
  the foregoing claim priority, and (iii) all reissues, reexaminations,
  extensions, continuations, continuations in part, continuing prosecution
  applications, and divisions of such patents and applications; and (iv)
  foreign counterparts to any of the foregoing, including certificates of
  invention, utility models, industrial design protection, design patent
  protection, and other governmental grants, and (v) any of the forgoing in
  (ii)-(iv) whether or not expressly listed in Exhibit
  A and whether or not abandoned, rejected, or the like.

  

 

 

	
  3.

  	
  DELIVERY AND PAYMENT

  
	
   

  	
   

  
	
  3.1

  	
  Delivery. 
  Within ten (10) days following the Effective Date, Seller shall
  deliver to Purchaser the Assignment Agreements, an original notarized Assignment
  of Patent Rights (Exhibit B hereto), the List
  of Prosecution Counsel, and all files and original documents owned or
  controlled by Seller (including, Letters Patents, assignments, and other
  documents necessary to establish that the Seller’s representations and
  warranties of Section 6 are true and correct) relating to the Patents,
  including, without limitation, all prosecution files for pending patent
  applications included in the Patents, and its own files relating to the
  issued Patents (“Initial Deliverables”).  Seller acknowledges that Purchaser may
  request additional documents based on Purchaser’s review of the Initial
  Deliverables (such additional documents and the Initial Deliverables,
  collectively, the “Deliverables”), and that
  as a result of Purchaser’s review, the amount of payment and the assets
  listed in Exhibits A and B may be revised.

  
	
   

  	
   

  
	
  3.2

  	
  Payment. 
  At the Closing (as defined below), Purchaser shall pay to Seller the
  amount of Five Hundred Sixty Thousand Dollars ($560,000).

  
	
   

  	
   

  
	
  3.3

  	
  Closing. 
  When all conditions herein have been waived or satisfied, the closing
  of the sale of the Patents will occur (the “Closing”), but in no event prior
  to thirty days following the Seller’s delivery to Purchaser of the items
  listed in Section 3.1.

  
	
   

  	
   

  
	
  3.4

  	
  Conditions to Closing.  The following are conditions precedent to
  the closing and to Purchaser’s obligation to make the payments contemplated
  by Section 3.1 of this Agreement:

  
	
   

  	
   

  
	
   

  	
  (a)

  	
  Delivery of the items listed in Section 2 and compliance with Section
  5 to the reasonable satisfaction of Purchaser, and

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Purchaser’s reasonable satisfaction that, as of the Closing, the
  representations and warranties in Section 6 are true and correct.

  
	
   

  	
   

  
	
  3.5

  	
  Termination. 
  If the conditions to closing have not been met within thirty (30) days
  following Seller’s delivery to Purchaser of the items listed in Section 3.1, Purchaser
  will have the right to terminate this Agreement.

  
	
   

  	
   

  
	
  4.

  	
  TRANSFER OF PATENTS

  
	
   

  	
   

  
	
  4.1

  	
  Patent Assignment.  Subject to receipt of payment, Seller
  hereby sells, assigns, transfers and conveys to Purchaser all right, title
  and interest in and to the Patents and the Patent Rights (as defined in Exhibit B).

  
	
   

  	
   

  
	
  4.2

  	
  Assignment of Causes of Action.  Subject to receipt of payment, Seller
  hereby also sells, assigns, transfers and conveys to Purchaser all right,
  title and interest in and to

  

 

2

 

	
   

  	
  (a)

  	
  inventions and discoveries described in any of the Patents; 

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  rights to apply in any or all countries of the world for patents,
  certificates of invention, utility models, industrial design protections,
  design patent protections, or other governmental grants of any type related
  to any of the Patents and the inventions and discoveries therein;

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  causes of action (whether currently pending, filed, or otherwise) and
  other enforcement rights, including, without limitation, all rights under the
  Patents and/or under or on account of any of the Patents and the foregoing
  category (b) to (i) damages, (ii) injunctive relief, and (iii) any other
  remedies of any kind for past, current and future infringement; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  rights to collect royalties or other payments under or on account of
  any of the Patents or any of the foregoing.

  
	
   

  	
   

  	
   

  
	
  5.

  	
  ADDITIONAL OBLIGATIONS

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Further Cooperation.  At the reasonable request of Purchaser,
  Seller shall execute and deliver such other instruments and do and perform
  such other acts and things as may be necessary or desirable for effective
  completely the consummation of the transactions contemplated hereby,
  including execution, acknowledgement and recordation of other such papers,
  and using commercially reasonable efforts to obtain the same from the
  respective inventors, as necessary or desirable for fully perfecting and
  conveying unto Purchaser the benefit of the transactions contemplated hereby.

  
	
   

  	
   

  	
   

  
	
  5.2

  	
  Payment of Fees.  Prior to receipt of payment, Seller shall
  pay any outstanding maintenance fees, annuities, and the like due on the
  Patents as of the Effective Date. 
  Seller shall not be responsible for any maintenance fees, annuities,
  and the like due to payable on the Patents after the Effective Date.

  
	
   

  	
   

  	
   

  
	
  6.

  	
  REPRESENTATIONS AND WARRANTIES

  
	
   

  	
   

  	
   

  
	
   

  	
  Seller hereby represents and warrants to Purchaser as follows that,
  as of the Effective Date and as of the Closing:

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Authority. 
  Seller has the full power and authority, and has obtained all third
  party consents, approvals and/or other authorizations required, to enter into
  this Agreement and to carry out its obligations hereunder, including, without
  limitation, the assignment of the Assigned Patent Rights to Purchaser.

  
	
   

  	
   

  	
   

  
	
  6.2

  	
  Title and Contest.  Seller owns all right, title, and interest
  to the Assigned Patent Rights, including all right, title, and interest to sue
  for infringement of the Patents. 
  Seller has obtained and properly recorded previously executed
  assignments for the Assigned Patent 

  

 

3

 

	
   

  	
  Rights as necessary to fully perfect its rights and title therein in
  accordance with governing law and regulations in each respective
  jurisdiction.  The Assigned Patent
  Rights are free and clear of all liens, claims, mortgages, security interests
  or other encumbrances, and restrictions. 
  There are no actions, suits, investigations, claims or proceedings
  threatened, pending or in progress relating in any way to the Assigned Patent
  Rights.  There are no existing
  contracts, agreements, options, commitments, proposals, bids, offers, or
  rights with, to, or in any person to acquire any of the Assigned Patent
  Rights.  

  
	
   

  	
   

  	
   

  
	
  6.3

  	
  Existing Licenses.  No licenses under the Patents, or interest
  or rights in any of the Assigned Patent Rights, have been granted or
  retained.  

  
	
   

  	
   

  	
   

  
	
  6.4

  	
  Restrictions on Rights.  Purchaser shall not be subject to any
  covenant not to sue or similar restrictions on its enforcement or enjoyment
  of the Assigned Patent Rights as a result of any prior transaction related to
  the Assigned Patent Rights.

  
	
   

  	
   

  	
   

  
	
  6.5

  	
  Conduct. 
  None of Seller or its representatives have engaged in any conduct, or
  omitted to perform any necessary act, the result of which would invalidate
  any of the Patents or hinder their enforcement, including but not limited to
  misrepresenting Seller’s patent rights to a standard-setting
  organization.  

  
	
   

  	
   

  	
   

  
	
  6.6

  	
  Enforcement. 
  Seller has not put a third party on notice of actual or potential
  infringement of any of the Patents. 
  Seller has not invited any third party to enter into a license under
  any of the Patents.  Seller has not
  initiated any enforcement action with respect to any of the Patents.

  
	
   

  	
   

  	
   

  
	
  6.7

  	
  Patents Office Proceedings.  None of the Patents have been or are
  currently involved in any reexamination, reissue, interference proceeding, or
  any similar proceeding and that no such proceedings are pending or
  threatened.  

  
	
   

  	
   

  	
   

  
	
  6.8

  	
  Fees. 
  All maintenance fees, annuities, and the like due on the Patents have
  been timely paid.

  
	
   

  	
   

  	
   

  
	
  6.9

  	
  Validity and Enforceability.  The Patents have never been found invalid
  or unenforceable for any reason in any administrative, arbitration, judicial
  or other proceeding.  Except for
  correspondences from the United States Patent and Trademark Office (e.g.,
  office actions), Seller does not know of and has not received any notice or
  information of any kind from any source suggesting the Patents may be invalid
  or unenforceable.  

  
	
   

  	
   

  	
   

  
	
  7.

  	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Nonexclusive License Grant-Back.  Upon receipt of executed Assignment of
  Patent Rights (Exhibit B hereto),
  Purchaser shall grant Seller a non-transferable, non-exclusive worldwide
  right and license under the Patents to make, have made, import, use, sell or

  

 

4

 

	
   

  	
  offer for sale any products and/or services covered by the Patents,
  all without the right to sublicense.  

  
	
   

  	
   

  	
   

  
	
  7.2

  	
  Limitation on Consequential Damages.  NEITHER PARTY SHALL HAVE ANY OBLIGATION OR
  LIABILITY (WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE) OR
  OTHERWISE, AND NOTWITHSTANDING ANY FAULT, NEGLIGENCE (WHETHER ACTIVE,
  PASSIVE, OR IMPUTED), REPRESENTATION, STRICT LIABILITY OR PRODUCT LIABILITY,
  FOR COVER OR FOR ANY INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR LOSS OF
  REVENUE, PROFIT, SAVINGS OR BUSINESS ARISING FROM OR OTHERWISE RELATED TO
  THIS AGREEMENT, EVEN IF A PARTY OR ITS EMPLOYEES HAVE BEEN ADVISED OF THE
  POSSIBILITY OF SUCH DAMAGES.  

  
	
   

  	
   

  	
   

  
	
  7.3

  	
  Limitation of Liability.  EXCEPT FOR FRAUD OR BREACH OF WARRANTIES OF
  SECTION 6, EACH PARTY’S TOTAL LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED
  THE PURCHASE PRICE SET FORTH IN SECTION 3 OF THIS AGREEMENT.  THE PARTIES ACKNOWLEDGE THAT THESE
  LIMITATIONS ON POTENTIAL LIABILITIES WERE AN ESSENTIAL ELEMENT IN SETTING
  CONSIDERATION UNDER THIS AGREEMENT.

  
	
   

  	
   

  	
   

  
	
  7.4

  	
  Compliance with Laws.  Notwithstanding, anything contained in this
  Agreement to the contrary, the obligations of the parties shall be subject to
  all laws, present and future, of any government having jurisdiction over the
  parties and this transaction, and to orders, regulations, directions or
  requests of any such government.  

  
	
   

  	
   

  	
   

  
	
  7.5

  	
  Confidentiality of Terms.  The parties hereto shall keep the terms and
  existence of this Agreement and the identities of the parties hereto confidential
  and shall not now to hereafter divulge any of this information to any third
  party expect: (a) with the prior written consent of the other party; (b) as
  otherwise may be required by law or legal process, including in confidence to
  legal and financial advisors in their capacity of advising a party in such
  matters; (c) during the course of litigation, so long as the disclosure of
  such terms and conditions are restricted in the same manner as is the
  confidential information of other litigating parties; or (d) in confidence to
  its legal counsel, accountants, banks and financing sources and their
  advisors solely in connection with complying with financial transactions;
  provided that, in (b) through (d) above, (i) the disclosing party shall use
  all legitimate and legal means available to minimize the disclosure to third
  parties, including without limitation seeking a confidential treatment
  request or protective order whenever appropriate or available; and (ii) the
  disclosing party shall provide the other party with at least ten (10) days
  prior written notice of such disclosure. 
  Without limiting the foregoing, Seller agrees that it will cause its
  agents involved in this transaction to abide by the terms of this paragraph
  7.4, including ensuring that such agents do not disclose or otherwise
  publicize the existence of this transaction with actual or potential clients
  in marketing materials, or industry conferences.  

  

 

5

 

	
  7.6

  	
  Governing Law; Venue/Jurisdiction.  This Agreement shall be interpreted,
  construed and enforced in all respects in accordance with the laws of the
  State of California, without reference to its choice of law principles to the
  contrary.  Seller shall not commence or
  prosecute any action, suit, proceeding or claim arising under or by reason of
  this Agreement other than in the state or federal courts located in
  California.  Seller irrevocably
  consents to the jurisdiction and venue of the courts identified in the
  preceding sentence in connection with any action, suit, proceeding or claim
  arising under or by reason of this Agreement. 
  

  
	
   

  	
   

  	
   

  
	
  7.7

  	
  Notices: All notices required or permitted
  to be given hereunder shall be in writing, shall make reference to this
  Agreement, and shall be delivered by hand, or dispatched by prepaid air
  courier or by registered or certified airmail, postage prepaid, addressed as
  follows:

  
	
   

  	
   

  	
   

  
	
   

  	
  If to Seller

   

  eAcceleration Corp. 

   

  1050 NE Hostmark St., Ste 100B

   

  Poulsbo, WA 98370

   

  Attn: Clinton Ballard

  	
  If to Purchaser

   

  Mount Hamilton Partners, LLC

   

  650 Castro Street, Suite 120-333

   

  Mountain View, CA 94041

   

  Attn: Managing Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Notices are to be deemed given on (a) the date of receipt if
  delivered personally or by express courier (or if delivery refused, the date
  of refusal), or (b) the fifth (5th) calendar day
  after the date of posting if sent by US mail. 
  Notice given in any other manner shall be deemed to have been given
  only if and when received at the address of the person to be notified.  Either party may from time to time change
  its address for notices under this Agreement by giving the other party
  written notice of such change in accordance with this paragraph.

  
	
   

  	
   

  	
   

  
	
  7.8

  	
  Relationship of Parties.  The parties are independent contractors and
  not partners, joint ventures, or agents of the other.  Neither party assumes any liability of or
  has any authority to bind, or control the activities of, the other.  

  
	
   

  	
   

  	
   

  
	
  7.9

  	
  Equitable Relief.  Seller agrees that damages alone would be
  insufficient to compensate Purchaser for a breach of this Agreement,
  acknowledges that irreparable harm would result from a breach of this
  Agreement, and consents to the entering of an order for injunctive relief to
  prevent a breach or further breach, and the entering of an order for specific
  performance to compel performance of any obligations under this Agreement.

  
	
   

  	
   

  	
   

  
	
  7.10

  	
  Severability.  If any provision of this Agreement is found
  to be invalid or unenforceable, then the remainder of this Agreement shall
  have full force and effect, and the invalid provision shall be modified, or
  partially enforced, to the maximum extent permitted to effectuate its
  original objective.

  
				

 

6

 

	
  7.11

  	
  Waiver. 
  Failure by either party to enforce any term of this Agreement shall not
  be deemed a waiver of future enforcement of that or any other term in this
  Agreement or any other agreement that may be in place between the parties.

  
	
   

  	
   

  	
   

  
	
  7.12

  	
  Miscellaneous.  This agreement, including its exhibits,
  constitutes the entire agreement between the parties with respect to the
  subject matter hereof, and merges and supersedes all prior and
  contemporaneous agreements, understandings, negotiations and
  discussions.  Neither of the parties
  shall be bound by any conditions, definitions, warranties, understandings, or
  representations with respect to the subject matter hereof other than as
  expressly provided herein.  The section
  headings contained in this Agreement are for reference purposes only and
  shall not affect in any way the meaning or interpretation of this
  Agreement.  No oral explanation or oral
  information by either party hereto shall alter the meaning or interpretation
  of this Agreement.  No amendments or
  modifications shall be effective unless in a writing signed by authorized
  representatives of both parties.  These
  terms and conditions shall prevail notwithstanding any different, conflicting
  or additional terms and conditions that may appear on any purchase order,
  acknowledgment or other writing not expressly incorporated into this
  Agreement.  The following exhibits are
  attached hereto and incorporated herein: Exhibit A
  (entitled “Patents to be Assigned”); and Exhibit B
  (entitled “Assignment of Patent Rights”).

  
	
   

  	
   

  	
   

  
	
  7.13

  	
  Counterparts; Electronic Signature.  This Agreement may be executed in counterparts,
  each of which shall be deemed an original, and all of which together
  constitute one and the same instrument. 
  Each party shall execute and deliver to the other parties a copy of
  this Agreement bearing its original signature.  Prior to such execution and delivery, in
  order to expedite the process of entering into this Agreement, the parties
  acknowledge that Transmitted Copies of this Agreement shall be deemed
  original documents.  “Transmitted Copies” means copies
  that are reproduced or transmitted via email of a .pdf file, photocopy,
  facsimile or other process of complete and accurate reproduction and
  transmission. 

  
	
   

  	
   

  	
   

  
	
  7.14

  	
  Assignment. 
  The terms and conditions of this Agreement shall inure to the benefit
  of Purchaser, its successors, assigns and other legal representatives, and
  shall be binding upon Seller, its successor, assigns and other legal
  representatives.  

  

 

 

[THE REMAINDER OF THIS PAGE INTENTIONALLY
LEFT BLANK]

 

7

 

In witness
whereof, the parties have executed this Patent Purchase Agreement as of the
Effective Date.

 

 

	
  PURCHASER:

  	
   

  	
  SELLER:

  
	
   

  	
   

  	
   

  
	
  Mount
  Hamilton Partners, LLC

  	
   

  	
  eAcceleration Corp.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Rakesh Ramde

  	
   

  	
  By:

  	
  /s/ Clint Ballard

  	
   

  
	
   

  	
   

  
	
  Name:

  	
  Rakesh Ramde

  	
   

  	
  Name:

  	
  Clint Ballard

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  President

  	
   

  	
  Title:

  	
  CEO

  	
   

  
												

 

8

 

Exhibit A

 

PATENTS TO BE ASSIGNED

 

	
  Patent or Application No.

  	
   

  	
  Country

  	
   

  	
  Filing/Issued

  Date

  	
   

  	
  Title and Inventor(s)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,430,739

  	
   

  	
  US

  	
   

  	
  07/16/1999

  	
   

  	
  Software execution contingent on home page setting by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,473,756

  	
   

  	
  US

  	
   

  	
  06/11/1999

  	
   

  	
  Method for selecting among equivalent files on a global computer
  network by Clinton L. Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,157,930

  	
   

  	
  US

  	
   

  	
  09/24/1998

  	
   

  	
  Accelerating access to wide area network information in mode for
  showing document then verifying validity by Clinton L. Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,078,960

  	
   

  	
  US

  	
   

  	
  07/03/1998

  	
   

  	
  Client-side load-balancing in client server network by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 5,987,457

  	
   

  	
  US

  	
   

  	
  11/25/1997

  	
   

  	
  Query refinement method for searching documents by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,182,050

  	
   

  	
  US

  	
   

  	
  5/28/1998

  	
   

  	
  Advertisements distributed on-line using target criteria screening
  with method for maintaining end user privacy by Clinton L. Ballard.

  

 

Exhibit B

 

ASSIGNMENT OF PATENT RIGHTS

 

For good and
valuable consideration, the receipt of which is hereby acknowledged,
eAcceleration Corp., a Delaware corporation with an office at 1050 NE Hostmark
St., Suite 100B, Poulsbo, WA 98370 (“Assignor”),
does hereby sell, assign, transfer and convey unto Mount Hamilton Partners,
LLC, a Delaware limited liability company with an office at 650 Castro Street,
Suite 120-333, Mountain View, CA 94041 (“Assignee”),
or its designees, all right, title and interest that exist today and may exist
in the future in and to all of the following (the “Patent
Rights”): (a) the provisional patent applications, patent
applications and patents listed below, (b) all patents or patent applications
to which any of the foregoing claim priority, and (c) current or future rights
to (i) provisional patent applications, patent applications, and patents of any
kind relating to any inventions and discoveries described in any provisional
patent applications, patent applications and patents listed below; (ii)
reissues, reexaminations, extensions, continuations, continuations in part,
continuing prosecution applications, and divisions of such patents and
applications; and (iii) foreign counterparts to any of the foregoing,
including, without limitation, certificates of invention, utility models,
industrial design protection, design patent protection, and other governmental
grants; (d) the rights to all inventions and discoveries described in any provisional
patent application, patent application or patent listed below and all other
rights arising out of such invention and discoveries; (e) rights to apply in
any or all countries of the world for patents, certificates of invention,
utility models, industrial design protections, design patent protections or other
governmental grants of any type related to any of the foregoing categories (a),
(b), (c), and (d), including, without limitation, under the Paris Convention
for the Protection of Industrial Property, the International Patent Cooperation
Treaty, or any other convention, treaty, agreement or understanding; (f) causes
of action (whether currently pending, filed, or otherwise) and other
enforcement rights, including without limitation, all rights under the
provisional patent applications, patent applications and patents listed below
and/or under or on account of any of the foregoing categories (b), (c), and/or
(d) to

 

	
  (i)

  	
  damages,

  
	
  (ii)

  	
  injunctive relief, and

  
	
  (iii)

  	
  other remedies of any kind

  

 

for past, current and future infringement; and

 

(g) all rights to collect royalties and other payments under or on
account of any of the foregoing.

 

 

	
  Patent or Application No.

  	
   

  	
  Country

  	
   

  	
  Filing/Issued

  Date

  	
   

  	
  Title and Inventor(s)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,430,739

  	
   

  	
  US

  	
   

  	
  07/16/1999

  	
   

  	
  Software execution contingent on home page setting by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,473,756

  	
   

  	
  US

  	
   

  	
  06/11/1999

  	
   

  	
  Method for selecting among equivalent files on a global computer
  network by Clinton L. Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,157,930

  	
   

  	
  US

  	
   

  	
  09/24/1998

  	
   

  	
  Accelerating access to wide area network information in mode for
  showing document then verifying validity by Clinton L. Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,078,960

  	
   

  	
  US

  	
   

  	
  07/03/1998

  	
   

  	
  Client-side load-balancing in client server network by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 5,987,457

  	
   

  	
  US

  	
   

  	
  11/25/1997

  	
   

  	
  Query refinement method for searching documents by Clinton L.
  Ballard.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US 6,182,050

  	
   

  	
  US

  	
   

  	
  05/28/1998

  	
   

  	
  Advertisements distributed on-line using target criteria screening
  with method for maintaining end user privacy by Clinton L. Ballard.

  

 

 

	
   

  	
  Assignor
  represents, warrants and covenants that:

  
	
   

  	
   

  	
   

  
	
  (1)

  	
   

  	
  Assignor
  has the full power and authority, and has obtained all third party consents,
  approvals and/or other authorizations required, to enter into this Agreement,
  make the assignments, and to carry out its obligations under this Assignment
  of Patent Rights;

  
	
   

  	
   

  	
   

  
	
  (2)

  	
   

  	
  Assignor
  owns all right, title, and interest to the Patent Rights, including, without
  limitation, all right, title, and interest to sue for infringement of the
  Patent Rights. Assignor has obtained and properly recorded previously
  executed assignments for the Patent Rights as necessary to fully perfect its
  rights and title therein in accordance with governing law and regulations in
  each respective jurisdiction. The Patent Rights are free and clear of all
  liens, claims, mortgages, security interests or other encumbrances, and
  restrictions. There are no actions, suits, investigations, claims or
  proceedings threatened, pending or in progress relating in any way to the
  Patent

  
	
   

  	
   

  	
   

  

2

 

Rights.  There are no existing
contracts, agreements, options, commitments, proposals, bids, offers or rights
with, to, or in any person to acquire any of the Patent Rights.

 

Assignor
hereby authorizes the respective patent office or governmental agency in each
jurisdiction to issue any and all patents, certificates of invention, utility
models or other governmental grants that may be granted upon any of the Patents
Rights in the name of Assignee, as the assignee to the entire interest therein.

 

Assignor shall,
at the reasonable request of Assignee and without demanding any further
consideration therefore, do all things necessary, proper, or advisable,
including without limitation the execution, acknowledgment and recordation of
specific assignments, oaths, declarations and other documents on a
country-by-country basis, to assist Assignee in obtaining, perfecting,
sustaining, and/or enforcing the Patent Rights. 
Such assistance shall include providing, and obtaining from the
respective inventors, prompt production of pertinent facts and documents,
giving of testimony, execution of petitions, oaths, power of attorney,
specifications, and declarations or other papers and other assistance
reasonably necessary for filing patent applications, complying with any duty of
disclosure, and conducting prosecution, reexamination, reissue, interference or
other priority proceedings, opposition proceedings, cancellation proceedings,
public use proceedings, infringement or other court actions and the like with
respect to the Patent Rights.  With prior
written approval by Assignee, Assignee will pay Assignor’s reasonable costs and
expenses.

 

The terms and
conditions of this Assignment of Patent Rights shall inure to the benefit of
Assignee, its successors, assigns and other legal representatives, and shall be
binding upon Assignor, its successor, assigns and other legal representatives.

 

 

[THE REMAINDER OF THIS PAGE INTENTIONALLY
LEFT BLANK]

 

3

 

IN WITNESS
WHEREOF this Assignment of Patent Rights is executed at Bainbridge Island on
12/15/05.

 

ASSIGNOR

 

	
  By:

  	
  /s/ Clint Ballard

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Clint Ballard

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  CEO

  	
   

  

 

(Signature MUST be notarized)

 

 

	
  STATE OF WASHINGTON

  	
  )

  
	
   

  	
  ) ss.

  
	
  COUNTY OF KITSAP

  	
  )

  

 

On December 15, 2005, before me, Stephen L. Reece, Notary Public in and
for said State, personally appeared Clinton Ballard, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person whose name
is subscribed to the within instrument and acknowledged to me that he/she
executed the same in his/her authorized capacity, and that by his/her signature
on the instrument the person, or the entity upon behalf of which the person
acted, executed the instrument.

 

	
  WITNESS my hand and official seal. 
  

  	
  [SEAL]

  
	
   

  
	
   

  
	
  Signature

  	
  /s/ Stephen L. Reece

  	
   

  
	
   

  	
   

  
				

 

4

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