1
EXHIBIT 10.11
UNITED STATES FIDELITY AND GUARANTY COMPANY
FIDELITY AND GUARANTY INSURANCE COMPANY
FIDELITY AND GUARANTY INSURANCE UNDERWRITERS, INC.
MASTER SURETY AGREEMENT
This AGREEMENT is made and entered into by:
ENTER NAME, ADDRESS, AND SOCIAL SECURITY OR TAX ID NUMBER.
The Majestic Star Casino, LLC, 400 Renaissance Center, #2400,
Detroit, MI, 48243, 43-1664986
Don H. Barden, 400 Renaissance Center, #2400, Detroit, MI, 48243,
###-##-####
Bella I. Marshall, 400 Renaissance Center, #2400, Detroit, MI, 48243,
###-##-####
In favor of UNITED STATES FIDELITY AND GUARANTY COMPANY, FIDELITY AND GUARANTY
INSURANCE COMPANY, FIDELITY AND GUARANTY INSURANCE UNDERWRITERS, INC., and any
and all affiliated, associated and subsidiary companies thereof, now existing or
hereafter created, assumed or otherwise acquired (hereinafter referred to as
Surety), their successors and assigns.
In this Agreement the words BOND, PERSON, UNDERSIGNED and PRINCIPAL are defined:
BOND: (1) Contract of suretyship, guaranty or indemnity; (2) the continuation,
extension, alteration, renewal or substitution of such contract; (3) a letter
from SURETY to a PERSON or PRINCIPAL wherein SURETY represents to such PERSON
or PRINCIPAL that it is prepared and willing to execute in behalf of PRINCIPAL
the BOND(S) required by such PERSON'S invitation for bids or proposals and
referred to herein as a BID LETTER.
PERSON: Individual(s), partnerships(s), association(s), corporation(s) or any
other legal or commercial entity(ies);
UNDERSIGNED: PERSON(S) who execute this agreement.
PRINCIPAL: One or more UNDERSIGNED or any partnership, association,
corporation or other legal or commercial entity in which UNDERSIGNED have a
substantial, material and/or beneficial interest to the extent that the
partnership, association, corporation or other legal or commercial entity would
be considered a subsidiary, associated or affiliated company of UNDERSIGNED
who, alone or with other PERSON(S), have secured, or may secure the performance
and fulfillment of obligations by BOND(S) (whether or not required to do so by
statue, ordinance, contract, order of court, rule of court, or otherwise),
executed, provided, or procured by SURETY.
In consideration of SURETY'S:
(1) heretofore having executed, provided or procured BOND(S) in behalf of
PRINCIPAL; or
(2) receiving requests for BOND(S) from UNDERSIGNED and determining whether or
not SURETY will execute, provide or procure the BOND(S) requested; or
(3) hereafter executing, providing or procuring BOND(S) in behalf of PRINCIPAL;
UNDERSIGNED covenant and agree that:
I (A) this AGREEMENT binds UNDERSIGNED and the heirs, personal
representatives, successors and assigns thereof, jointly and severally, to
SURETY in connection with all BOND(S) heretofore or hereafter executed,
provided or procured by SURETY in behalf of PRINCIPAL in any penal sum and
in favor of any obligee(s);
CONT 5 (1-92) (CONTINUED)
PAGE 1 OF 4
2
(B) This AGREEMENT shall not be construed as an offer by UNDERSIGNED
to indemnify SURETY which SURETY must accept prior to its
executing, providing or procuring BOND(S) in behalf of PRINCIPAL, but
shall be construed as part of the consideration on which SURETY has
relied or will rely in executing, providing or procuring BOND(S) in
behalf of PRINCIPAL; (C) SURETY has relied upon and will rely on the
covenants and agreements of UNDERSIGNED as consideration for the BOND(S)
executed, provided or procured in behalf of PRINCIPAL; (D) This
AGREEMENT inures to the benefit of any cosurety or reinsurer of SURETY
in said BOND(S) and in the event SURETY procures the execution of BOND(S)
by other sureties, this AGREEMENT shall inure to the benefit of such
other sureties.
II UNDERSIGNED will pay or cause to be paid to SURETY, its successors and
assigns, the premium charged or to be charged by SURETY for executing,
providing or procuring BOND(S) for PRINCIPAL.
III (A) UNDERSIGNED shall exonerate, hold harmless, indemnify and keep
indemnified SURETY from and against any and all demands, claims,
liabilities, losses and expenses of whatsoever kind or nature (including
but not limited to, interest, court costs and counsel fees) imposed upon,
sustained, or incurred by SURETY by reason of: (1) SURETY having
executed, provided or procured BOND(S) in behalf of PRINCIPAL, or (2)
UNDERSIGNED'S failure to perform or comply with any of the provisions of
this AGREEMENT;
(B) In order to exonerate, hold harmless, and indemnify SURETY,
UNDERSIGNED shall upon demand of SURETY, place SURETY in funds before
SURETY makes any payment; such funds shall be, at SURETY'S option, money
or property, or liens or security interests in property. (The amount of
such money or property or the value of the property to become subject to
liens or security interests, shall be determined by SURETY.)
(C) SURETY may reduce the amount of UNDERSIGNED'S liability to SURETY
hereunder by applying to such liability any money payable to UNDERSIGNED
by SURETY; (Such liability may arise from UNDERSIGNED'S obligation to
exonerate, to hold harmless and to indemnify SURETY and may be liquidated
or unliquidated; and, the "money payable to UNDERSIGNED" may be, but is
not limited to, any money payable by SURETY as an insurer of UNDERSIGNED
or another PERSON to return to UNDERSIGNED an unearned or other premium
or to settle a claim of UNDERSIGNED against SURETY or a PERSON insured by
SURETY.)
IV (A) The liability of UNDERSIGNED hereunder shall extend to and include
all amounts paid by SURETY in good faith under the belief that: (1)
SURETY was or might be liable therefor; (2) such payments were necessary
or advisable to protect any of SURETY'S rights or to avoid or lessen
SURETY'S liability or alleged liability;
(B) the liability of UNDERSIGNED to SURETY shall include interest from
the date of SURETY'S payments at the maximum rate permitted in the
jurisdiction in which this AGREEMENT is enforced, or is enforceable;
(C) the voucher(s) or other evidence of such payment(s) or an itemized
statement of payment(s) sworn to by an officer of SURETY shall be prima
facie evidence of the fact and extent of the liability of UNDERSIGNED to
SURETY.
V (A) Separate suits may be brought hereunder as causes of action accrue,
and the bringing of suit or the recovery of judgment upon any cause of
action shall not prejudice or bar the bringing of other suits upon other
causes of action, whether theretofore or thereafter arising;
(B) each UNDERSIGNED is the agent for all UNDERSIGNED for the purpose of
accepting service of any process in the jurisdiction in which the
UNDERSIGNED accepting the process resides, is domiciled, is doing
business or is found;
(C) in the event SURETY should file suit at law or in equity to enforce
the terms of this AGREEMENT, SURETY shall be entitled to recover its own
reasonable attorney's fees and expenses from UNDERSIGNED in connection
with such suit.
VI When BOND(S) secure the performance and fulfillment of contracts,
PRINCIPAL and UNDERSIGNED, agree that:
(A)(1) SURETY has the rights of indemnification, exoneration and
subrogation; and (2) SURETY'S rights of indemnification, exoneration and
subrogation may be enforced as provided by applicable law or, at option of
SURETY, as follows:
(a) with respect to each specific contract secured by BOND(S) all
money and property representing the consideration for the contract is
dedicated for: (i) the performance of the contract; (ii) the payment
of obligation(s) to subcontractor(s), laborer(s) and supplier(s) of
material(s) and service(s) incurred or to be incurred in the
performance of the contract for which SURETY is liable under BOND(S)
and, (iii) the satisfaction of the obligations herein and all other
indebtednesses and liabilities of PRINCIPAL or UNDERSIGNED to
SURETY; (b) to partially implement this dedication SURETY may, in its
sole discretion, demand that PRINCIPAL request delivery of the
consideration for the contract to a bank designated by SURETY for
deposit of the proceeds of the consideration for the contract(s) in an
account in the name of PRINCIPAL designated as a "Special Account"
and withdrawal(s) from said "Special Account" shall be by
check(s), payable to the beneficiaries of this dedication, signed by
a representative of PRINCIPAL and by a representative of SURETY; (c)
this dedication may be implemented in any other manner provided at law
or in equity;
(B) In the event of: (1) any breach of any of the agreements herein; (2)
any breach, delay or default in any contract secured by BOND(S); (3) any
breach or default of BOND(S); (4) any change or threat of change in the
character, identity, control, beneficial ownership or existence of
PRINCIPAL; (5) any assignment by PRINCIPAL for the benefit of creditors;
(6) the appointment of a receiver or trustee or any application for
appointment of a receiver or trustee for PRINCIPAL, whether insolvent or
not; (7) any proceedings or the exercise of any rights by any PERSON
which deprives or impairs PRINCIPAL'S use of its plant, machinery,
equipment, plans, drawings, tools, supplies or materials; (8) upon the
happening of any event other than those specified in (1) through (7) and
completely different from those events, which, in its sole opinion may
expose SURETY to loss, cost or expense.
(CONTINUED)
Page 2 OF 4
3
(a) SURETY shall have the right, in its discretion, to take possession
of any part or all of the work under contract(s) secured by BOND(S)
(together with plant, machinery, equipment, job books and records, plans,
drawings, tools, supplies or material wherever located and owned or usable
by PRINCIPAL) and, at the expense of UNDERSIGNED, to complete or cause
completion of any such work, or relet or consent to the reletting or
completion of such contract(s), and;
(b) SURETY is authorized and empowered to assert, pursue and prosecute, in
its discretion, and at the expense of UNDERSIGNED (in the name of PRINCIPAL
or in the name of SURETY), all claim(s) of PRINCIPAL arising or growing out
of contract(s) and work done thereunder secured by BOND(S) against: (i)
Obligee(s) in BOND(S); or (ii) any PERSON, government or governmental
agency. (The authority and power to prosecute said claim(s) is deemed to
include the authority to settle said claim(s) or any part thereof; and the
money or property awarded by Obligee(s) representative, a judicial or
quasi-judicial officer or a panel or board, or the money or property to
become due in settlement of said claim(s) is deemed to be a portion of the
"money or property representing the consideration for the contract" and
subject to the dedication in subparagraph (A) of this paragraph).
VII (A) UNDERSIGNED are not obligated to request SURETY to execute, provide or
procure BOND(S) required of them in the performance and fulfillment of
obligations;
(B) SURETY has the right to decline to execute, provide or procure BOND(S)
requested by PRINCIPAL;
(C) if SURETY executes, provides or procures a bid or proposal bond or
furnishes a BID LETTER in behalf of PRINCIPAL, SURETY has the right to
decline to execute the final BOND(S) (including, but not limited to
performance, payment or maintenance bond(s)) that may be required in
connection with any award that may be made under the bid, proposal or
tender for which the bid or proposal bond or BID LETTER is given.
VIII UNDERSIGNED shall not be relieved of liability hereunder by any change,
addition, substitution, continuation, renewal, extension, successor or new
obligation in connection with BOND(S) or any contract(s) secured thereby,
whether known or consented to by SURETY, and notice of SURETY'S consent is
hereby waived.
IX (A) SURETY'S rights hereunder shall be deemed to be cumulative with, and
in addition to, all other rights of SURETY, however derived;
(B) SURETY is not required to exhaust its remedies or rights against
PRINCIPAL or to await receipt of any or final dividends from the legal
representative(s) of PRINCIPAL before asserting its rights hereunder
against UNDERSIGNED;
(C) This AGREEMENT shall be liberally construed so as to protect, hold
harmless, exonerate and indemnify SURETY.
X (A) At any time during business hours and until such time as (1) the
liability of SURETY under BOND(S) is terminated or (2) SURETY is fully
reimbursed all its losses, cost and expenses as a result of having
executed, provided, or procured BOND(S) in behalf of PRINCIPAL, SURETY
shall have access to the books, records and accounts of UNDERSIGNED;
(B) when requested by SURETY, banks, depositories, obligees in BOND(S),
materialmen, supply houses, or other PERSON(S) are hereby authorized to
furnish SURETY and information requested with respect to PRINCIPAL, or
UNDERSIGNED.
XI (A) There shall be no waiver, modification or change of the terms of this
AGREEMENT without the written approval of an officer of SURETY;
(B) if an UNDERSIGNED previously executed an agreement of indemnity or
MASTER SURETY AGREEMENT in favor of SURETY and upon which SURETY relied
when it executed, provided or procured BOND(S) in behalf of any PERSON as
PRINCIPAL, SURETY'S acceptance of this AGREEMENT neither terminates such
agreement of indemnity or MASTER SURETY AGREEMENT nor relieves such
UNDERSIGNED from liability to SURETY thereon in connection with such
BOND(S).
(C) this AGREEMENT may be terminated as to any UNDERSIGNED upon written
notice given to SURETY by such UNDERSIGNED or such UNDERSIGNED'S legal
representatives or successors by Registered or Certified Mail addressed to
SURETY at its Home Office in Baltimore, Maryland;
(D) if an UNDERSIGNED: (1) dies; (2) becomes physically or mentally
disabled to the extent that he or she is unable to perform the duties of
owner, partner, officer or employee of an UNDERSIGNED which is or may
become PRINCIPAL in BOND(S); (3) terminates his or her marriage by
annulment or divorce; or, (4) sells or disposes of his or her interest in
an UNDERSIGNED which is or may become PRINCIPAL in BOND(S); this AGREEMENT
may be terminated as to such UNDERSIGNED upon receipt by
SURETY at its Home Office in Baltimore, Maryland, of written notice of such
death, disability, annulment, divorce, sale or disposition (such written
notice shall be given as specified in Subparagraph XI (C);
(E) termination of this AGREEMENT pursuant to Subparagraph XI (C) or XI (D)
shall not be effective until thirty (30) days after receipt of said written
notice by SURETY;
(F) termination of this AGREEMENT pursuant to Subparagraph XI (C) or XI (D)
shall not relieve any UNDERSIGNED from liability of SURETY arising out of
BOND(S) executed, provided or procured by SURETY in behalf of PRINCIPAL
prior to the effective date of such termination and for which this
AGREEMENT is part of the consideration on which SURETY relied in executing,
providing or procuring such BOND(S).
XII In the event that the execution of this AGREEMENT by any one or more of
UNDERSIGNED is defective or invalid for any reason, such defect or
invalidity shall have no effect upon the validity of this AGREEMENT as to
any other UNDERSIGNED. Similarly, should any portion of this AGREEMENT be
deemed invalid or unenforceable, the remaining provisions shall be valid
and enforceable.
XIII This AGREEMENT constitutes the entire AGREEMENT between the parties and all
previous representations, negotiations, discussions and promises concerning
SURETY'S willingness to provide, procure or execute bonds in any specific
amount, single limit or aggregate work program, or concerning SURETY'S
intention to enforce or refrain from enforcing any of the terms of this
AGREEMENT or exempt any specific assets or waive any of the terms hereof
are hereby merged into this AGREEMENT.
(CONTINUED)
PAGE 3 OF 4
4
CAUTION! READ BEFORE SIGNING!
The UNDERSIGNED represent to the SURETY that they have carefully read the
entire AGREEMENT and that by executing this AGREEMENT they are bound to the
SURETY with respect to all BOND(S) executed, provided, or procured or to be
executed, provided or procured by SURETY in behalf of PRINCIPAL as defined on
page 1.
IN WITNESS WHEREOF, the UNDERSIGNED who are individuals have hereunto set their
hands and seals, and the UNDERSIGNED who are partnerships, corporations or
unincorporated associations have caused this AGREEMENT to be duly executed by
their duly authorized representatives all on this 29th day of April, 1996.
The Majestic Star Casino, LLC
Attest: Kenneth L. Kramer Don H. Barden
- ------------------------------------ ---------------------------------------
Title: Secretary Title: President
WITNESS: Kenneth L. Kramer Don H. Barden
- ------------------------------------ ---------------------------------------
ADDRESS: 400 RenCen #2400, Don H. Barden
Detroit, MI 48243
WITNESS: Kenneth L. Kramer Bella I. Marshall
- ------------------------------------ ---------------------------------------
ADDRESS: 400 RenCen #2400, Bella I. Marshall
Detroit, MI 48243
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
- ------------------------------------ ---------------------------------------
ALL SIGNATURES MUST BE WITNESSED
IF A CORPORATION, AFFIX SEAL. ATTACH COPY OF BOARD OF DIRECTORS RESOLUTION
RATIFYING OFFICER'S EXECUTION OF THIS AGREEMENT.
PAGE 4 OF 4