The Cherokee Code: Published by Order of the Tribal Council of the Eastern Band of Cherokee Indians

Chapter 16A - Tribal Casino Gaming Enterprise*

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*Cross references: Tribal gaming, ch. 16; Tribal bingo enterprise, ch. 16B.
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Sec. 16A-1. Authority.

(a) Pursuant to the authority vested in the Eastern Band of Cherokee Indians by its governing document and particularly by section 23 thereof, and its inherent Tribal sovereign authority to oversee, protect and preserve the assets and benefits of the Tribe, together with its capacity and authority to conduct both governmental and business activities by and on behalf of the Tribe, especially when Tribal members derive direct benefit from such activities, the Tribal Council hereby creates this Tribal enterprise that shall be known as the Tribal Casino Gaming Enterprise, hereafter referred to as the TCGE.

(b) In any suit, action or proceeding involving the validity or enforcement of any of its contracts, the TCGE shall be conclusively deemed to have become established and authorized to transact business and exercise its powers upon proof of the adoption of this chapter. A copy of the chapter duly certified by the Clerk of the Tribal Council, shall be admissible in evidence in any suit, action or proceeding.

(Ord. No. 389, 11-7-1996)

Sec. 16A-2. Declaration of need.

It is hereby declared:

(a) The Eastern Band of Cherokee Indians is authorized by the Indian Gaming Regulatory Act ("IGRA") by virtue of section 5(D) of its Gaming Compact with the State of North Carolina to operate a Class III Tribal gaming enterprise (the "Permanent Casino"); that the Tribal Council of the Eastern Band of Cherokee Indians has revised its gaming ordinances to comply with the IGRA and regulations promulgated by the National Indian Gaming Commission ("NIGC"); that the Tribal Council has established a Gaming Commission ("TGC") which has regulatory oversight responsibilities over all gaming on the Cherokee Indian Reservation, to ensure that appropriate gaming laws and regulations are complied with.

(b) The Board of Advisors of the Tribal Casino Gaming Enterprise is authorized to undertake such actions as are necessary and appropriate for the execution of the duties and authorities enumerated herein.

(c) That the TCGE is hereby created and established in the public interest to provide an organizational plan which can most effectively and efficiently direct the Permanent Casino's gaming operations of the Tribe for business purposes.

(d) The Tribe has determined that it will be in the best interest of the Tribe to construct the permanent casino of approximately 175,000 square feet for the conduct of Class III Gaming, as that term is defined in the IGRA on land on the Cherokee Indian Reservation described in Exhibit A to Ordinance No. 389 (1996) (the Permanent Casino site).

(e) The Tribe has determined that it would be in the best interest of the Tribe to have authority for the administration and oversight of Class III Gaming at the Permanent Casino exercised for the Tribe by a separate, single purpose instrumentality of the Tribe having the authority, powers and duties set forth in this chapter under the governance of a Board of Advisors, chosen and acting in the manner set forth in this chapter.

(f) The Tribe has selected Harrah's WC Casino Company, L.L.C., a North Carolina limited liability company (the "Manager"), which is owned by Harrah's Entertainment, Inc., to act as the Manager of the Casino, pursuant to a Management Agreement dated June 19, 1996, between the Tribe and the Manager (the "Management Agreement"), and to develop the Casino pursuant to a Development and Construction Agreement dated June 19, 1996, between the Tribe and the Manager (the "Development Agreement").

(g) The Tribe has determined that construction and startup of the permanent casino should be financed by a bank loan to be made by Bankers Trust Company as Agent and a bank group of lenders (the "Banks") pursuant to a credit agreement among Bankers Trust Company as Agent for the Banks as the lenders, the TCGE as the borrower and the Banks (the "Credit Agreement").

(h) The Credit Agreement requires, among other things, that the Manager, Harrah's Entertainment, Inc. and Harrah's Operating Company, Inc. (the "Secured Parties") jointly and severally enter into a Guaranty and Loan Purchase Agreement (the "Guaranty") which includes a complete and unconditional guarantee of obligations under the Credit Agreement; and the secured parties require, as a condition to the issuance of the Guaranty among other things, that the TCGE agree to enter into a Security and Reimbursement Agreement with the secured parties (the "Security and Reimbursement Agreement") and a Pledge of Deposit Accounts Letter Agreement (the "Pledge Agreement") with the secured parties.

(Ord. No. 389, 11-7-1996)

Sec. 16A-3. Board of advisors; generally.

(a) Composition of the Board: The Board of Advisors shall be composed of five enrolled members of the Eastern Band of Cherokee Indians who must have clearly demonstrated their business acumen through past business or career successes.

(b) Appointment of the Board: Members of the Board of Advisors shall be appointed by the Principal Chief, subject to the approval of the Tribal Council. Nominees to the Board of Advisors shall be selected on the basis of their business experience and ability to significantly contribute to the capabilities and functions of the gaming enterprise. At least one member of the Board of Advisors shall be an experienced auditor or certified public accountant.

(c) Members of the Board of Advisors may hold other positions of employment with the Tribe and may engage in business; provided, however, that they shall not engage in any business regulated pursuant to the provisions of this chapter or chapter 16 of this Code.

(d) Each member of the Board of Advisors shall serve a term of five years, subject to removal, with cause, at the pleasure of the Tribal Council. Nothing in this chapter shall be construed to preclude a member of the Board of Advisors from serving successive terms, except a Board member shall not serve more than two successive terms. There shall be a six-month probationary period for each new appointee to be reviewed by the Tribal Council.

(d1) To ensure continuity in the Board and rotation of appointments, the initial Board members' terms shall be adjusted so that they serve staggered terms. Upon the effective date of this amendment, the Principal Chief shall assign first term expiration dates for each current Board member, such that one member's term expires each year beginning September 30, 2000. The established rotation shall continue for each Board position for future new, renewal, or replacement appointments.

(e) No member of the Board of Advisors shall be finally selected until he or she has completed a background investigation conducted by the Gaming Commission with the same criteria applied to the Board member as is applied to key employees, as defined in chapter 16 of this Code, as same may be amended or replaced from time to time.

(f) Before assuming office, each member of the Board of Advisors shall take the oath of office administered to Tribal officers.

(g) Members of the Board of Advisors are prohibited from playing or participating in any gaming activity in any of the Tribal Gaming Enterprises.

(h) Resignation from the Board of Advisors: A member of the Board of Advisors may resign at any time by providing the Tribal Council with written notice of his or her intention to resign on a date certain. The resignation shall become effective on the date stated and need not be accepted by the Tribal Council to be effective.

(i) Filling of vacancies in the Board of Advisors: A nomination to fill a vacancy in the Board of Advisors shall be made by the Principal Chief within 30 days after the date on which the vacancy becomes effective. The Principal Chief shall then submit the nominee's resume to the Tribal Council for their approval. Action by the Tribal Council shall occur within 30 days after receipt of the nomination from the Principal Chief.

(Ord. No. 389, 11-7-1996; Ord. No. 180, 4-17-2000)

Sec. 16A-4. Eligibility criteria for TCGE Board of Advisors.

No person shall be eligible or qualified to serve or continue to serve as a member of the Board of Advisors who:

(a) Owns or has an immediate family member, as defined in section 92-4(e)(1) who owns a financial interest in any gaming operation or financial interest in the management of any gaming operation;

(b) Provides professional services to a gaming enterprise;

(c) Is an elected official of the Tribe or has an immediate family member who is an elected official of the Tribe;

(d) Is a Gaming Commissioner or employee of the Gaming Commission or has an immediate family member who is a Gaming Commissioner or employee of the TCGE;

(e) Has any role whatever in the management of a gaming enterprise pursuant to a management contract between the Tribe and another party;

(f) Has been convicted of a felony or any other criminal offense involving moral turpitude; or

(g) Is younger than 25 years of age.

(Ord. No. 389, 11-7-1998)

Sec. 16A-5. Powers and duties of Board of Advisors.

(a) The TCGE Board of Advisors shall be charged with the following duties and is authorized to undertake any and all actions necessary and appropriate for the execution of such duties consistent with the purposes for which it is established. The TCGE shall be authorized to exist, operate and exercise the following enumerated powers for a perpetual period from the date of ratification of this chapter over all Class III Gaming activities owned by, or operated on behalf of, the Tribe in the Permanent Casino.

(1) Limitations of authority. The TCGE shall possess only those powers arising under this chapter, and the authority and power of the TCGE is constrained by the limitations contained in this chapter.

(2) Duration of TCGE. The TCGE shall come into existence as a separate, single purpose instrumentality of the Tribe on the date this chapter is adopted and continue in existence for the duration of the Management Agreement and until all obligations under the Credit Agreement have been repaid, and thereafter for a perpetual period until its existence is terminated by action of the Tribal Council. To enable the TCGE to carry out its duties pursuant to this chapter, it is hereby granted the exclusive rent-free right to use the Permanent Casino site subject to the provisions of the Management Agreement and the Development Agreement for the duration of the Compact. The TCGE shall not have any authority to conduct, administer or oversee any Class III Gaming at any facility other than the Permanent Casino on the Permanent Casino site.

(3) (A) Power to waive sovereign immunity and Tribal waiver of sovereign immunity. The TCGE has the power and authority to waive its right and the right of the Tribe to exercise Tribal sovereign immunity in any contracts, agreements or undertakings to which the TCGE is a party, including with respect to any such contracts, agreements or undertakings the power and authority:

(i) To agree on the law that will govern,

(ii) To agree to sue and be sued,

(iii) To agree on the forum or fora in which existing or future disputes may be resolved,

(iv) To agree to resolve and to resolve existing and future disputes by means of arbitration,

(v) To appoint arbitrators,

(vi) To consent to the jurisdiction of any court of competent jurisdiction to compel arbitration,

(vii) To agree that any award of the arbitrators may be enforced in any court of competent jurisdiction, and

(viii) To waive any requirement for the exhaustion of Tribal remedies, provided such suit or proceeding is brought against the TCGE or the Tribe in the Court of Indian Offenses of the Eastern Band of Cherokee Indians or any successor Cherokee Tribal Court ("Cherokee Court") or in the United States District Court for the Western District of North Carolina, the United States Court of Appeals for the Fourth Circuit and the United States Supreme Court; or any other court of competent jurisdiction; and provided further that any such waiver is consistent with the limitations set forth in subparagraph 3(B) of this section. Without in any way limiting the generality of the foregoing, the TCGE, on its own behalf and on behalf of the Tribe, has the express power and authority to authorize any governmental authorities who have the right and duty under applicable law to take any action authorized or ordered by any court described in this paragraph 3(A) including, without limitation, entering the Permanent Casino for the purpose of executing against any proper subject to a security interest or otherwise giving effect to any judgment or arbitration award entered, subject to the limitations set forth in subparagraph 3(B) of this section. The Tribe consents to the exercise of jurisdiction over such action and over the TCGE by said courts and to accept service of process upon the TCGE by delivery to any officer or managing agent of the Tribe doing business as the TCGE, and any judgment or arbitration award shall only be enforceable against those assets described in paragraph 3(B) below.

(B) Assets against which enforcement can be sought. The enforcement of any judgment, order or arbitration award against the TCGE or the Tribe in accordance with subparagraph 3(A) of this section is limited to enforcement of obligations of the TCGE, and can be made only against the following assets, including the following revenues:

(i) The assets of the TCGE;

(ii) The assets (other than real property and fixtures), including the revenues, related to or arising from the operation of the Permanent Casino, whether legal title to such assets or revenues is in the name of the TCGE or the Tribe;

(iii) Any proceeds obtained by the TCGE through the use, ownership or other operation or disposition of such assets or of the business operated by the Tribe in the name of the TCGE; and

(iv) Any other assets produced or acquired by the Tribe and operated as part of the business of TCGE; and

(v) Provided, however, that assets, including revenues, transferred in accordance with article XIV of chapter 16 of this Code to other accounts or purposes of the Tribe shall be exempt from such enforcement.

(C) If in any case, the TCGE should exceed the foregoing limitations on its power and authority to waive sovereign immunity, it shall be deemed to have waived its sovereign immunity or that of the Tribe only to the extent permitted in subparagraphs 3(A) and 3(B) of this section.

(4) (A) The Board of Advisors shall be responsible for oversight of Management of the TCGE, provided that the Management or Management Contractors shall be responsible for day-to-day operation, development, management and maintenance of the gaming enterprise, the administration and enforcement of personnel policies, and hiring and termination of the employment of gaming enterprise employees.

(B) Management or Management Contractors shall report to the TCGE Board of Advisors at the frequency and in the format established by the Board of Advisors. Nothing herein contained shall be construed to create a conflict with any management or development agreements which the Tribe has entered into and if any such conflicts do arise then the Management or Development Agreements will be deemed to prevail.

(Ord. No. 389, 11-7-1996)

Sec. 16A-6. Order of business of Board.

The Board of Advisors shall establish regular meetings, not less than monthly.

(a) Notice of meetings. Notice of each meeting of the Board shall be mailed to each member, addressed to each Board member's address or usual place of business, not less than five nor more than 20 days from the day on which the meeting is to be held, or notice may be delivered to such member personally not less than two days before the day on which the meeting is to be held. Notice of any meeting of the Board need not be given to any member who shall waive such notice.

(b) The Board of Advisors may call emergency meetings upon 24 hours' notice to Board members with the time and place of such meeting and the business to be transacted at such meeting. Any business conducted in an emergency session shall be approved by not less than a majority of the full Board of Advisors.

(c) The Board of Advisors shall endeavor to attend all meetings of the TCGE. The TCGE shall decide whether absences of a Board member are excused or unexcused. Three consecutive unexcused absences of a Board member shall be reported by the TCGE to the Tribal Council. Three consecutive unexcused absences may be considered cause for removal by the Tribal Council.

(Ord. No. 389, 11-7-1996)

Sec. 16A-7. Elections of Board officers.

The Board of Advisors shall, at the first meeting of each fiscal year, elect from among themselves a Chairperson, a Vice-Chairperson and a Secretary. The Board member selected on the basis of his or her experience in auditing or accounting shall be designated Treasurer.

(Ord. No. 389, 11-7-1996)

Sec. 16A-8. Report by Board to the Tribal Council.

The Board of Advisors shall be responsible for the preparation and presentation to the Tribal Council of the certified annual audit subject to the requirements of section 16A-20(e) below and shall thereafter submit such annual audit to the NIGC.

(Ord. No. 389, 11-7-1996)

Sec. 16A-9. Preservation of Board records.

(a) The Secretary of the Board of Advisors shall prepare and maintain complete and accurate records of all meetings and actions taken by the Board.

(b) The Treasurer shall keep complete and accurate financial records of the Board's expenses and receipts, report at least every fiscal quarter to the Board and shall submit a complete annual report to the Board.

(c) Reports. TCGE shall file quarterly reports with the Tribal Council and the Tribal Gaming Commission. The report shall include:

(1) Unaudited financial statements, prepared in accordance with generally accepted accounting principles, which reflect all business conducted at the Permanent Casino during the preceding fiscal quarter and year to date, as well as budgeted amount for the balance of the current fiscal year;

(2) Material changes and developments since the last report in the business conducted at the Permanent Casino, including a description of competitive conditions, research and development activities, new lines of business conducted by TCGE, the approximate amount of total sales and revenue, and income (or loss) attributable to each specific type of Class III Game and for each line of business which accounted for more than ten percent of total sales and revenues of Permanent Casino;

(3) Any material pending legal proceeding to which TCGE or a business venture of TCGE is or was a party;

(4) Total hirings, promotions and terminations by job classification during the preceding fiscal quarter of TCGE employees and work force forecast for each position classification for the current fiscal year; and

(5) Such other or different matters as the Tribal Council may request. The TCGE shall file with the Tribal Council such additional reports as required from time to time by the Tribal Council, as well as, meet all federal and state compliance.

(Ord. No. 389, 11-7-1996)

Sec. 16A-10. Additional authorities and duties of Board.

The Board of Advisors shall by resolution approved by not less than a majority of the full Board membership:

(a) Annually prepare and submit for review by the Principal Chief and the Tribal Council an annual operating budget to include short range and long range goals and objectives of TCGE and the strategies used by TCGE to accomplish these goals and objectives;

(b) Approve budgets for the Permanent Casino, including its annual operating and capital budgets and annual business plans;

(c) Approve the establishment of account at specified banks as required;

(d) Authorize the expenditure of funds in the accounts of TCGE as necessary for the operation and maintenance of the business and properties of the Permanent Casino and the timely payment of financial liabilities and obligations of the Permanent Casino;

(e) Enter into agreements, contracts, understandings with any government agency, person, partnership, corporation or Indian Tribe;

(f) Lease property from the Tribe and others for such periods as are lawfully authorized to hold and manage or sublease such properties;

(g) Borrow money and issue temporary or long term evidence of indebtedness and timely repay such debts;

(h) Pledge the assets and receipts of the TCGE as security for debts and acquire, sell, lease, exchange, transfer and/or assign the non-realty property or interest of the TCGE;

(i) Undertake and carry out feasibility and other studies and analyses of gaming operations and markets, prepare gaming plans, and execute such plans to the extent permitted by the IGRA, Tribal-State Gaming Compact and this chapter, and amendments hereto;

(j) Prepare and adopt operation and management plans concerning gaming operations as required or otherwise necessary for the proper conduct of gaming as authorized by the Tribal Council pursuant to this chapter and amendments hereto;

(k) With respect to a gaming enterprise not operated by the Tribe pursuant to a Management Contract, employ a General Manager and delegate to the General Manager all duties and responsibilities as necessary for the lawful, efficient and profitable operation of the gaming enterprise;

(l) Cooperate with all other tribal gaming agencies and entities of the Tribe;

(m) The TCGE Board of Advisors shall exercise approval authority with respect to the following, and shall timely provide such approval (or notice of non-approval):

(1) Internal management policies including:

(a) A written manual sufficiently setting forth policy and procedures regarding:

(i) Hiring, disciplinary and discharge from employment of Permanent Casino employees including policy and rights of appeal governing the provision of the Indian Preference employment rights; and

(ii) Procurement policies.

(2) Vendor contracts, contracts consenting facility maintenance and repairs and contracts and sub-contracts regarding ancillary commercial activities of the gaming enterprise including retail shops and concessions;

(3) Advertisement and promotional sales and activities;

(4) Construction plans and specifications, interior and exterior design and furnishings;

(5) Annual operating, capital and working capital budgets.

(n) Approve reserve fund and the amounts contributed thereto, and direct the contribution of casino revenues to these approved reserve funds as created by TCGE Board of Advisors, provided that such reserves are either (1) required by an NIGC approved management agreement, or (2) specifically authorized by a Tribal Council resolution; and

(o) Negotiate for, and fund from TCGE revenues or reserves, the acquisition of real property to be titled in the name of the Tribe for casino/hotel purposes, provided that each acquisition shall be specifically authorized by a Tribal Council resolution.

(Ord. No. 389, 11-7-1996; Ord. No. 671 §§ 1, 2, 3-30-2005)

Sec. 16A-11. Quorum at Board meetings.

Three members of the Board shall constitute a quorum.

(Ord. No. 389, 11-7-1996)

Sec. 16A-12. Decision making by Board.

The Board shall meet and decide all matters by majority vote of the full Board. The Chairperson shall vote on all issues. A majority vote shall be binding on the Board. The Chairperson, or the Vice-Chairperson in the Chairperson's absence, shall preside at each meeting.

(Ord. No. 389, 11-7-1996)

Sec. 16A-13. Minutes of Board meetings.

The Secretary shall cause to be kept a complete and accurate record of all Board meetings, copies of which shall be furnished to the Board and to the Tribal Council upon request.

(Ord. No. 389, 11-7-1996)

Sec. 16A-14. Compensation of Board members.

Compensation, if any, of the Board members shall be determined by and approved by the Tribal Council and shall be paid from TCGE funds. Board Members shall be reimbursed from TCGE funds for all reasonable out-of-pocket expenses incurred while acting on behalf of the TCGE Board. Any such compensation and reimbursement shall be considered an operating expense of the TCGE.

(Ord. No. 389, 11-7-1996)

Sec. 16A-15. Signatory authority.

All contracts and other documents executed in the name of the TCGE must be signed by two Officers, one of whom shall be the Chairperson or the Vice-Chairperson, provided that if both of them are absent or disabled, any other two officers expressly designated by the Board of Advisors to sign the specific contracts or documents may sign the contracts and documents for and on behalf of the TCGE. A certificate of any officer of the TCGE regarding the absence or disability of the Chairperson and the Vice-Chairperson shall be binding on the TCGE.

(Ord. No. 389, 11-7-1996)

Sec. 16A-16. Accountability of Board.

The Board shall be responsible and accountable to the Tribal Council. Upon request of the Tribal Council, the Board shall promptly and fully advise the Tribal Council with respect to the business and affairs of TCGE and shall provide the Tribal Council with copies of requested records, books or documents of TCGE. The Tribal Council may require such written reports regarding TCGE business and affairs as the council deems necessary.

(Ord. No. 389, 11-7-1996)

Sec. 16A-17. Sub-committees of Board.

The Board may from time to time establish consultant groups and advisory Boards which shall have such duties and the members of which shall hold office for such periods as the Board may determine.

(Ord. No. 389, 11-7-1996)

Sec. 16A-18. Board Officers.

(a) Positions and selection. From among the Board members, the Board shall appoint the following Officers of the TCGE Board ("Officers"): a Chairperson, a Vice-Chairperson, Secretary, and Treasurer.

(b) Terms of office. The Board shall appoint its Officers at each annual meeting of the Board in the first week of October.

(c) Powers and duties. Subject to the supervisory authority of the Board, Officers shall have the following powers and duties, in addition to such other powers and duties as may be set for the office in this article or applicable law, or as may be assigned by the Board:

(1) Chairperson. The Chairperson shall preside over all Board meetings; sign on behalf of TCGE all documents, contracts, or other instruments approved for such execution by the Board; and be responsible, jointly with the Treasurer, for the authorized and secure receipt, maintenance, execution, endorsement, disbursement, and other disposition of all funds, checks, drafts, other order or demands for money, notes other evidence of indebtedness, securities and other valuable instruments and shall have such other powers and duties as may from time to time be assigned to him by the Board.

(2) Vice-Chairperson. The Vice-Chairperson shall exercise the powers and perform the duties of Chairperson when the Chairperson is absent or disabled, sign on behalf of TCGE all documents, contracts, or other instruments approved for such execution by the Board, and shall have such other powers and duties may from time to time be assigned to him or her by the Board.

(3) Secretary. The Secretary shall issue notices for all Board meetings; keep minutes of all meetings; and serve as custodian of and maintain all minutes or meetings and associated records and correspondence of the TCGE Board. The Secretary shall make such reports and perform such other duties as are incident to the office, or are property required or assigned to him by the Board.

(4) Treasurer. The Treasurer shall be responsible, jointly with the Chairperson, for the authorized and secure receipt, maintenance, execution, endorsement, disbursement, and other disposition of all funds, check, drafts or other order or demands for money, notes, other evidence of indebtedness, securities and other valuable instruments be responsible for the maintenance of comprehensive financial books and records of transactions, prepared in accordance with generally accepted accounting principles. The Treasurer shall have principal oversight responsibilities for all financial functions and affairs of TCGE and shall serve as the Board's principal financial liaison with the Tribal Council and other members of TCGE management having financial management responsibilities with the TCGE with any Contract Manager, accounting firm and financial advisors. The Treasurer shall perform such other duties incident to the office or that are properly required by the Board.

(5) The Board may temporarily delegate the Board's powers or duties as an officer to another Board member, until the Board member is available or no longer disabled or until the Tribal Council fills the vacancy.

(d) Maintenance, inspection and return of books and records. There shall be maintained at the principal office of TCGE all financial books and records, all minutes of Board meetings, and all other materials, books, records, documents, correspondence, and contracts. All such material shall be made available for inspection and copying at any reasonable time during the usual business hours:

(1) To the Tribal Council or duly authorized representatives thereof;

(2) To any Board member;

(3) To the Tribal Gaming Commission; and

(4) To agents of the State of North Carolina or of the NIGC conducting inspections pursuant to the approved Tribal-State Class III Gaming Compact or compliance with applicable federal law.

(e) Duties upon termination of office. Upon termination from office, each Board member, employee and agent of TCGE shall turn over to his or her successor or to the Chairperson, in a timely fashion and in good order, all monies, books, records, minutes, documents contracts or other property of TCGE in his or her custody. If such property is not turned over or is damaged or missing, the Board may change each Board member and any employee or agent a reasonable replacement fee.

(Ord. No. 389, 11-7-1996)

Sec. 16A-19. Ownership and revenues.

(a) Ownership. All personal property assets used in the operation of the Permanent Casino whether now existing or hereafter acquired shall be titled in the name of the Tribal Casino Gaming Enterprise, as an instrumentality of the Eastern Band of Cherokee Indians and shall be administered for the Tribe by the TCGE for the benefit of the Tribe; provided, however, that nothing herein shall affect the title to the real property (which includes all land, buildings, improvements or fixtures) used in the operation of or related to the Permanent Casino, whether now existing or hereafter acquired, and all such real property shall continue to be held in the name of the Tribe with restrictions upon alienation imposed by the United States in trust for the Tribe, and the title to such real property shall always remain in trust status.

(b) General account. The TCGE Board shall establish a general bank account and shall deposit within such account all receipts of the TCGE. The account shall be used to meet ongoing business needs, contingencies, maintenance of property of TCGE, capital for expansion of existing operations or additional operations under the terms of this chapter, and for such other purposes as deemed necessary and appropriate by the Board. The Board may direct the establishment of additional accounts as it may deem reasonable and necessary for the conduct of TCGE business under this chapter.

(c) Limitation on use of TCGE net earnings. No part of the net earnings of TCGE shall inure to the benefit of or be distributed to any Board member or other private person, except that TCGE is authorized and empowered to pay reasonable compensation for services rendered to TCGE as provided in this chapter and to make payments and distribution in furtherance of the purposes set forth in this chapter.

(Ord. No. 389, 11-7-1996; Ord. No. 996, 9-11-2003)

Sec. 16A-20. Distribution of net revenues and other financial matters.

(a) The TCGE shall make monthly distributions to the Tribe of all net revenues as defined in Section 16C-2 of Chapter 16C of the Cherokee Code as amended.

(b) Upon actual distribution of funds from the TCGE to the Tribe, the funds shall no longer be deemed the funds or property of TCGE, and shall no longer be subject to or liable for the obligations of the TCGE.

(c) All obligations incurred in connection with the operation of TCGE as authorized by said Board shall be special obligations of the Tribe payable solely from the assets, including the revenues, of the Permanent Casino and subject to the limits of powers set forth in section 16A-5.

(d) The TCGE shall provide an annual certified audit of its operations and other such audits as the Tribe deems necessary which shall be conducted by a "big four" accounting firm experienced in casino gaming audits. The certified public accountants shall report any instances of noncompliance with the EGRA, the North Carolina Cherokee Gaming Compact, the regulations of the NIGC, or the ordinances or regulations of the Tribe, which come to their attention during the performance of the audit. The auditors shall be paid from operational funds of the TCGE. The auditor shall have access to all books and records, all cash management procedure manuals, all internal control manuals, and all other records, documents, papers and persons employed by the TCGE, as they deem necessary. For each audit, the auditor shall provide the Board of Advisors with a draft management letter and shall permit the Board and the General Manager a reasonable time within which to respond to the letter with changes to the operations of the TCGE which address the concerns expressed in the draft management letter. The results of the certified audit shall be provided to the Board, the Tribe, the Tribal Gaming Commission, the NIGC and such other governmental agencies as may be required by law.

(e) The TCGE shall file promptly any reports of gaming winnings, and the names of the winners, as the same may be required by the Internal Revenue Service of the United States and shall comply with all other provisions of the Internal Revenue Code applicable to the operation of the TCGE as well as any state reports required by the Compact.

(f) The TCGE shall submit an annual report to the Tribal Council, signed by the Chairperson of the Board, showing:

(1) A summary of the year's activities;

(2) The financial condition of the TCGE;

(3) The condition of the TCGE properties;

(4) Any significant problems and accomplishments;

(5) Plans for the future; and

(6) Such other information as the Board or the Tribal Council shall deem pertinent.

All prior resolutions and ordinances that are inconsistent with this ordinance are hereby rescinded.

(Ord. No. 389, 11-7-1996; Ord. No. 671, §§ 3, 4, 3-30-2005)

Sec. 16A-21. Litigation.

Obligation to notify Tribe and Tribal Gaming Commission. TCGE shall immediately notify the Chairman of the Tribal Council of the receipt of service of any summons or complaint upon TCGE, or any Board member, employee or agent of TCGE, or any management contractor, in which TCGE, or any Board member, employee or agent of TCGE is named in any suit, claim, action or other proceeding in any court, administrative or regulatory forum. A copy of the summons and complaint shall be provided to the Chairman of the Tribal Council and the Chairman of the Tribal Gaming Commission with the notice.

(Ord. No. 389, 11-7-1996)

Sec. 16A-22. Professional services.

TCGE shall be authorized to retain the services of any business or professional consultants or any consultants or assistants; provided that TCGE may retain the services of only those attorneys and auditors approved by the Tribal Council.

(Ord. No. 389, 11-7-1996)

Sec. 16A-23. Severability of provisions.

If any provision of this chapter or the application thereof to any person or circumstances shall be adjudged by any court of competent jurisdiction to be violative of applicable law or otherwise invalid, then that provision shall be severable and considered null and void, but such judgment shall not affect, impair or invalidate the remainder of this chapter or its application to other persons and circumstances, but shall remain in full force and effect, and such judgment shall be confined in its operation to the provisions of the chapter or the application thereof to the person and circumstances directly involved in the controversy in which such judgment was rendered.

(Ord. No. 389, 11-7-1996)

Sec. 16A-24. Adoption of By-laws.

The TCGE Board may adopt By-laws for the TCGE Board of Advisors; provided that such By-laws shall not contain provisions inconsistent with or in violation of the provisions of this chapter or applicable law.

(Ord. No. 389, 11-7-1996)

Sec. 16A-25. Duration of TCGE and chapter.

(a) By enacting this chapter, the Tribe, through its Tribal Council, agrees and affirmatively pledges that it shall not terminate the lawful existence of or the authority for the TCGE until or unless all obligations incurred by the TCGE for the financing of the Permanent Casino, have been satisfied, including without limitation, all obligations of the TCGE under the Credit Agreement and the Security and Reimbursement Agreement, and if for any reason the Tribe were to nevertheless terminate the existence or authority of the TCGE before all such obligations are satisfied then all obligations of the TCGE shall become the direct obligations of the Tribe; and the Tribe hereby irrevocably grants a waiver of the Tribe's sovereign immunity to permit the obliges of the TCGE to enforce such obligations against the Tribe in that circumstance, but with such waiver specifically limited to permit enforcement of such obligations as set forth in the Credit Agreement and the Security and Reimbursement Agreement.

(b) Notwithstanding anything contained in this chapter, in the event of any conflict or question of interpretation, the terms of the Management Agreement and/or the Construction and Development Agreement, the Credit Agreement, the Security and Reimbursement Agreement and any subsequent Management Agreement, between the Tribe and the Manager shall prevail over terms of this chapter.

(c) In addition to, and not in limitation of, the authority otherwise granted to the TCGE in this chapter, the TCGE is expressly authorized, acting as an instrumentality of the Tribe, to execute and deliver the Security and Reimbursement Agreement to create a security interest and first lien on the collateral described therein even although and in express recognition that such collateral constitutes assets of the Tribe.

(Ord. No. 389, 11-7-1996)

Sec. 16A-26. Rescission of inconsistent law.

All prior ordinances and resolutions in conflict with this chapter including without limitation Ordinance No. 432 (1994) and Ordinance No. 232 (1996) are hereby rescinded in their entirety.

(Ord. No. 389, 11-7-1996)

Sec. 16A-27. Definitions.

As used in this Chapter and Ordinance No. 389 (1996):

Credit agreement shall mean the credit agreement with Bankers Trust Company, as agent and the banks that are parties to such credit agreement from time to time with the TCGE as such credit agreement may be amended, restated or extended from time to time with the approval of Tribal Council or as the credit facilities thereunder may be replaced from time to time pursuant to a new credit agreement(s) with such banks and on such terms as the Tribal Council may approve from time to time.

Development agreement shall mean that certain restated development and construction agreement dated June 22, 2000 between the Tribe and Harrah's NC Casino Company, L.L.C., an affiliate of Harrah's Entertainment, Inc., as such agreement may be amended, restated or extended from time to time with the approval of Tribal Council and/or such other development agreement(s) which may be entered into with the approval of Tribal Council for the development of any portion of the permanent casino and permanent casino site.

Gaming enterprise shall have the same meaning as permanent casino.

Guaranty and loan purchase agreement shall mean any guaranty of obligations under the credit agreement as it exists from time to time by the manager or managers of the permanent casino (and/or one or more affiliates thereof) or any part thereof.

Management agreement shall mean the management agreement between the Tribe and Harrah's NC Casino Company, L.L.C. dated June 19, 1996 as amended by amendments dated January 29, 1998, November 22, 1999 and June 22, 2000 as the same may be further amended, restated or extended with respect to the management of the casino and the hotel and convention center which constitute a part of the permanent casino and such other management agreement(s) which may be entered into upon approval by the Tribal Council for the management and operation of all or any portion of the permanent casino as it exists from time to time.

Permanent casino shall mean the casino facility on the permanent casino site together with any expansions of such casino facility as are approved by Tribal Council together with any and all operations, activities or facilities which are authorized by Tribal Council to be developed and operated in conjunction and as a part of the TCGE's gaming activities, including without limitation the hotel and convention center.

Permanent casino site shall mean the land on the Cherokee Indian Reservation as described in Exhibit "A" to Ordinance No. 389 (1996) together with such other land as may be approved from time to time by Tribal Council where the permanent casino is located.

Pledge agreement shall mean a pledge of the deposit account of the TCGE required in connection with the credit agreement.

Security and reimbursement agreement shall mean that certain security and reimbursement agreement by the TCGE in favor of Harrah's NC Casino Company, L.L.C., Harrah's Entertainment, Inc. and Harrah's Operating Company, Inc. given in connection with the credit agreement or the management agreement as each may be amended, restated or extended from time to time with the approval of Tribal Council or as the same may be replaced with the approval of Tribal Council in connection with the credit agreement(s) or the management agreement as each exist from time to time with such other security agreements in favor of the lenders or guarantors of the credit agreement(s).

(Ord. No. 656, 4-5-2001)

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