CONSTRUCTION/TERM LOAN AGREEMENT
Dated as of September 25, 1996
among
SUNSET STATION, INC.
THE LENDERS HEREIN NAMED
BANK OF SCOTLAND
and
SOCIETE GENERALE
as Co-Agents
and
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Managing Agent
TABLE OF CONTENTS
Page
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Article 1 DEFINITIONS AND ACCOUNTING TERMS. . . . . . . . . . . . . . . . . 1
1.1 Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Use of Defined Terms . . . . . . . . . . . . . . . . . . . . . . 33
1.3 Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . 33
1.4 Rounding . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
1.5 Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . 34
1.6 References to "Borrower and its Subsidiaries". . . . . . . . . . 34
1.7 Miscellaneous Terms. . . . . . . . . . . . . . . . . . . . . . . 34
Article 2 LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.1 Loans-General. . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.2 Automatic Reduction of Commitment. . . . . . . . . . . . . . . . 36
2.3 Voluntary Reduction of Commitment. . . . . . . . . . . . . . . . 36
2.4 Managing Agent's Right to Assume Funds Available for
Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
2.5 Collateral and Guaranty. . . . . . . . . . . . . . . . . . . . . 37
2.6 Lender's Acknowledgement . . . . . . . . . . . . . . . . . . . . 37
Article 3 PAYMENTS AND FEES . . . . . . . . . . . . . . . . . . . . . . . . 38
3.1 Principal and Interest . . . . . . . . . . . . . . . . . . . . . 38
3.2 Arrangement Fee. . . . . . . . . . . . . . . . . . . . . . . . . 40
3.3 Upfront Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 41
3.4 Commitment Fees. . . . . . . . . . . . . . . . . . . . . . . . . 41
3.5 Prepayment Fee . . . . . . . . . . . . . . . . . . . . . . . . . 41
3.6 Managing Agent Fees. . . . . . . . . . . . . . . . . . . . . . . 41
3.7 Co-Agent Fees. . . . . . . . . . . . . . . . . . . . . . . . . . 42
3.8 Increased Commitment Costs . . . . . . . . . . . . . . . . . . . 42
3.9 Eurodollar Costs and Related Matters . . . . . . . . . . . . . . 42
3.10 Late Payments . . . . . . . . . . . . . . . . . . . . . . . . . 47
3.11 Computation of Interest and Fees. . . . . . . . . . . . . . . . 47
3.12 Non-Banking Days. . . . . . . . . . . . . . . . . . . . . . . . 47
3.13 Manner and Treatment of Payments. . . . . . . . . . . . . . . . 47
3.14 Funding Sources . . . . . . . . . . . . . . . . . . . . . . . . 49
3.15 Failure to Charge Not Subsequent Waiver . . . . . . . . . . . . 49
3.16 Managing Agent's Right to Assume Payments Will be Made by
Borrower. . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
3.17 Fee Determination Detail. . . . . . . . . . . . . . . . . . . . 49
3.18 Survivability . . . . . . . . . . . . . . . . . . . . . . . . . 50
Article 4 REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . . 51
4.1 Existence and Qualification; Power; Compliance With Laws . . . . 51
4.2 Authority; Compliance With Other Agreements and Instruments
and Government Regulations . . . . . . . . . . . . . . . . . . . 51
4.3 No Governmental Approvals Required . . . . . . . . . . . . . . . 52
4.4 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . 52
4.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . 53
4.6 No Other Liabilities; No Material Adverse Changes. . . . . . . . 54
4.7 Title to Property. . . . . . . . . . . . . . . . . . . . . . . . 54
4.8 Intangible Assets. . . . . . . . . . . . . . . . . . . . . . . . 54
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4.9 Public Utility Holding Company Act . . . . . . . . . . . . . . . 54
4.10 Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . 54
4.11 Binding Obligations . . . . . . . . . . . . . . . . . . . . . . 55
4.12 No Default. . . . . . . . . . . . . . . . . . . . . . . . . . . 55
4.13 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
4.14 Regulations G, T, U and X; Investment Company Act . . . . . . . 56
4.15 Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . . . 56
4.16 Tax Liability . . . . . . . . . . . . . . . . . . . . . . . . . 56
4.17 Projections . . . . . . . . . . . . . . . . . . . . . . . . . . 56
4.18 Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . 56
4.19 Gaming Laws . . . . . . . . . . . . . . . . . . . . . . . . . . 57
4.20 Security Interests. . . . . . . . . . . . . . . . . . . . . . . 57
Article 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION AND REPORTING
REQUIREMENTS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
5.1 Payment of Taxes and Other Potential Liens . . . . . . . . . . . 58
5.2 Preservation of Existence. . . . . . . . . . . . . . . . . . . . 58
5.3 Maintenance of Properties. . . . . . . . . . . . . . . . . . . . 58
5.4 Maintenance of Insurance . . . . . . . . . . . . . . . . . . . . 58
5.5 Compliance With Laws . . . . . . . . . . . . . . . . . . . . . . 59
5.6 Inspection Rights. . . . . . . . . . . . . . . . . . . . . . . . 59
5.7 Keeping of Records and Books of Account. . . . . . . . . . . . . 59
5.8 Compliance With Agreements . . . . . . . . . . . . . . . . . . . 59
5.9 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . 59
5.10 New Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . 59
5.11 Hazardous Materials Laws. . . . . . . . . . . . . . . . . . . . 60
5.12 Gaming Licenses . . . . . . . . . . . . . . . . . . . . . . . . 60
5.13 Supplemental Credit Facility. . . . . . . . . . . . . . . . . . 60
Article 6 NEGATIVE COVENANTS. . . . . . . . . . . . . . . . . . . . . . . . 62
6.1 Payment of Subordinated Obligations. . . . . . . . . . . . . . . 62
6.2 Disposition of Property. . . . . . . . . . . . . . . . . . . . . 62
6.3 Mergers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
6.4 Hostile Acquisitions . . . . . . . . . . . . . . . . . . . . . . 63
6.5 Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . 63
6.6 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
6.7 Change in Nature of Business . . . . . . . . . . . . . . . . . . 63
6.8 Liens and Negative Pledges . . . . . . . . . . . . . . . . . . . 63
6.9 Indebtedness and Guaranty Obligations. . . . . . . . . . . . . . 64
6.10 Transactions with Affiliates. . . . . . . . . . . . . . . . . . 64
6.11 Senior Funded Debt Ratio. . . . . . . . . . . . . . . . . . . . 64
6.12 Fixed Charge Coverage Ratio . . . . . . . . . . . . . . . . . . 65
6.13 Effective Net Worth . . . . . . . . . . . . . . . . . . . . . . 65
6.14 Capital Expenditures. . . . . . . . . . . . . . . . . . . . . . 65
6.15 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . 66
6.16 Acquisitions. . . . . . . . . . . . . . . . . . . . . . . . . . 66
6.17 Operating Leases. . . . . . . . . . . . . . . . . . . . . . . . 66
6.18 Subsidiary Indebtedness . . . . . . . . . . . . . . . . . . . . 67
6.19 Management Fees . . . . . . . . . . . . . . . . . . . . . . . . 67
6.20 Amendments to Equipment Sublease. . . . . . . . . . . . . . . . 67
6.21 Supplemental Loan Agreement . . . . . . . . . . . . . . . . . . 67
Article 7 CONSTRUCTION PERIOD COVENANTS . . . . . . . . . . . . . . . . . . 68
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7.1 Construction of Project. . . . . . . . . . . . . . . . . . . . . 68
7.2 Amendments to Plans and Budgets. . . . . . . . . . . . . . . . . 68
7.3 Timetable. . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
7.4 Construction Requirements. . . . . . . . . . . . . . . . . . . . 68
7.5 Construction Services Group. . . . . . . . . . . . . . . . . . . 68
7.6 Notice of Changes. . . . . . . . . . . . . . . . . . . . . . . . 68
7.7 Construction Progress Reports. . . . . . . . . . . . . . . . . . 69
7.8 Construction Information . . . . . . . . . . . . . . . . . . . . 69
7.9 Construction, Permits, Licenses and Approvals. . . . . . . . . . 69
7.10 Purchase of Materials . . . . . . . . . . . . . . . . . . . . . 69
7.11 Purchase of Offsite Materials . . . . . . . . . . . . . . . . . 69
7.12 Site Visits . . . . . . . . . . . . . . . . . . . . . . . . . . 69
7.13 Protection Against Lien Claims. . . . . . . . . . . . . . . . . 70
7.14 Completion Certificates . . . . . . . . . . . . . . . . . . . . 70
7.15 Completion Survey . . . . . . . . . . . . . . . . . . . . . . . 70
Article 8 INFORMATION AND REPORTING REQUIREMENTS. . . . . . . . . . . . . . 71
8.1 Financial and Business Information . . . . . . . . . . . . . . . 71
8.2 Compliance Certificates. . . . . . . . . . . . . . . . . . . . . 75
Article 9 CONDITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
9.1 Initial Advances . . . . . . . . . . . . . . . . . . . . . . . . 76
9.2 Initial Advances - Further Conditions. . . . . . . . . . . . . . 80
9.3 Advances - Special Condition . . . . . . . . . . . . . . . . . . 81
9.4 Any Advance. . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Article 10 EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT . . . . . . 83
10.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . 83
10.2 Remedies Upon Event of Default. . . . . . . . . . . . . . . . . 86
Article 11 THE MANAGING AGENT . . . . . . . . . . . . . . . . . . . . . . . 90
11.1 Appointment and Authorization . . . . . . . . . . . . . . . . . 90
11.2 Managing Agent and Affiliates . . . . . . . . . . . . . . . . . 90
11.3 Proportionate Interest in any Collateral. . . . . . . . . . . . 90
11.4 Lenders' Credit Decisions . . . . . . . . . . . . . . . . . . . 91
11.5 Action by Managing Agent. . . . . . . . . . . . . . . . . . . . 91
11.6 Liability of Managing Agent . . . . . . . . . . . . . . . . . . 92
11.7 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . 93
11.8 Successor Managing Agent. . . . . . . . . . . . . . . . . . . . 94
11.9 Foreclosure on Collateral . . . . . . . . . . . . . . . . . . . 95
11.10 No Obligations of Borrower . . . . . . . . . . . . . . . . . . 95
Article 12 MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . 96
12.1 Cumulative Remedies; No Waiver. . . . . . . . . . . . . . . . . 96
12.2 Amendments; Consents. . . . . . . . . . . . . . . . . . . . . . 96
12.3 Costs, Expenses and Taxes . . . . . . . . . . . . . . . . . . . 97
12.4 Nature of Lenders' Obligations. . . . . . . . . . . . . . . . . 98
12.5 Survival of Representations and Warranties. . . . . . . . . . . 99
12.6 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
12.7 Execution of Loan Documents . . . . . . . . . . . . . . . . . . 99
12.8 Binding Effect; Assignment. . . . . . . . . . . . . . . . . . . 100
12.9 Right of Setoff . . . . . . . . . . . . . . . . . . . . . . . . 103
12.10 Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . 103
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12.11 Indemnity by Borrower. . . . . . . . . . . . . . . . . . . . . 104
12.12 Nonliability of the Lenders. . . . . . . . . . . . . . . . . . 105
12.13 No Third Parties Benefited . . . . . . . . . . . . . . . . . . 106
12.14 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . 106
12.15 Further Assurances . . . . . . . . . . . . . . . . . . . . . . 107
12.16 Integration. . . . . . . . . . . . . . . . . . . . . . . . . . 107
12.17 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . 107
12.18 Severability of Provisions . . . . . . . . . . . . . . . . . . 108
12.19 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
12.20 Time of the Essence. . . . . . . . . . . . . . . . . . . . . . 108
12.21 Foreign Lenders and Participants . . . . . . . . . . . . . . . 108
12.22 Hazardous Material Indemnity . . . . . . . . . . . . . . . . . 109
12.23 Gaming Boards. . . . . . . . . . . . . . . . . . . . . . . . . 110
12.24 Waiver of Right to Trial by Jury . . . . . . . . . . . . . . . 110
12.25 Purported Oral Amendments. . . . . . . . . . . . . . . . . . . 110
Exhibits
--------
A - Architect's Certificate and Consent
B - Collateral Assignment
C - Commitment Assignment and Acceptance
D - Completion Guaranty
E - Compliance Certificate
F - Contractor's Certificate and Consent
G - Deed of Trust
H - Intercreditor Agreement
I - Landlord Consent and Agreement
J - Note
K-1 - Opinion of Counsel
K-2 Opinion of Counsel
L - Pledge Agreement
M - Request for Loan
N - Security Agreement
O - Subsidiary Guaranty
Schedules
---------
1.1 Lender Commitments
4.3 Governmental Approvals
4.4 Subsidiaries
4.7 Existing Liens, Negative Pledges and Rights of Others
4.8 Trademarks and Trade Names
4.10 Material Litigation
4.18 Environmental Matters
6.9 Existing Indebtedness
6.15 Existing Investments
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CONSTRUCTION/TERM LOAN AGREEMENT
Dated as of September 25, 1996
This CONSTRUCTION/TERM LOAN AGREEMENT ("Agreement") is entered into
by and among Sunset Station, Inc., a Nevada corporation ("Borrower"), each
lender whose name is set forth on the signature pages of this Agreement and each
lender which may hereafter become a party to this Agreement pursuant to
Section 12.8 (collectively, the "Lenders" and individually, a "Lender"), Bank of
Scotland and Societe Generale as Co-Agents, and Bank of America National Trust
and Savings Association, as Managing Agent.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
Article 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"ACQUISITION" means any transaction, or any series of related
transactions, by which Borrower and/or any of its Subsidiaries directly
or indirectly acquires any ongoing business or all or substantially all
of the assets of any firm, corporation or division thereof constituting
an ongoing business, whether through purchase of capital stock, assets,
merger or otherwise.
"ADJUSTED ANNUALIZED EBITDA" means, with respect to any fiscal
period, Annualized EBITDA for that fiscal period PLUS (a) any Cash Equity
Contributions (OTHER THAN Cash Equity Contributions required pursuant to
the Completion Guaranty or which are a Qualified Capital Source) made to
Borrower during that fiscal period PLUS (b) any Supplemental Loans made
to Borrower pursuant to Section 2.01(a) of the Supplemental Loan
Agreement during that fiscal period.
"ADVANCE" means any advance made or to be made by any Lender to
Borrower as provided in ARTICLE 2.
"AFFILIATE" means, as to any Person, any other Person which directly
or indirectly controls, or is under common control with, or is controlled
by, such Person. As used in this definition, "control" (and the
correlative terms, "controlled by" and "under common control with") shall
mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise); PROVIDED that, in any event, any Person that owns, directly
or indirectly, 10% or more of the securities having ordinary voting power
for the election of directors or other governing body of a corporation
that has more than 100
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record holders of such securities, or 10% or more of the partnership or
other ownership interests of any other Person that has more than 100
record holders of such interests, will be deemed to be an Affiliate of
such corporation, partnership or other Person.
"AGREEMENT" means this Construction/Term Loan Agreement, either as
originally executed or as it may from time to time be supplemented,
modified, amended, restated or extended.
"ALTERNATE BASE RATE" means, as of any date of determination, the
rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%)
equal to the HIGHER OF (a) the Reference Rate in effect on such date and
(b) the Federal Funds Rate in effect on such date plus 1/2 of 1%
(50 basis points).
"ALTERNATE BASE RATE ADVANCE" means, with respect to any Lender,
(a) the portion of an Alternate Base Rate Loan that is equal to such
Lender's Pro Rata Share of such Alternate Base Rate Loan and (b) the
portion of a Eurodollar Rate Loan to which Section 3.9(c) applies that is
equal to such Lender's Pro Rata Share of such Eurodollar Rate Loan.
"ALTERNATE BASE RATE LOAN" means a Loan made hereunder that is an
Alternate Base Rate Loan in accordance with ARTICLE 2.
"ALTERNATE BASE RATE MARGIN" means, for any Alternate Base Rate
Loan, the number of basis points which, when added to the Alternate Base
Rate as of the date such Loan was made as or converted into an Alternate
Base Rate Loan, would have resulted in an interest rate equal to the SUM
OF the Eurodollar Rate that would have applied on that date for a
Eurodollar Rate Loan with a three month Interest Period plus 3 3/4% (375
basis points).
"AMORTIZATION AMOUNT" means, with respect to each Amortization
Date, the amount set forth below opposite that Amortization Date:
AMORTIZATION DATE AMOUNT
Initial Amortization Date and each $1,750,000
of the next three (3) Amortization
Dates
Each of the next four (4) $2,250,000
Amortization Dates
Each of the next two (2) $2,000,000
Amortization Dates
"AMORTIZATION DATE" means the Initial Amortization Date and the last
day of each Eurodollar Period ending nearest to each June 30,
September 30, December 31 and March 31 thereafter.
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"ANNUALIZED EBITDA" means, as of the last day of each Fiscal Quarter
ending after the Completion Date, EBITDA for the fiscal period consisting
of that Fiscal Quarter and the three immediately preceding Fiscal
Quarters, ADJUSTED, with respect to any such fiscal period in which the
Project is open for business for at least one (1) full Fiscal Quarter but
less than four (4) full Fiscal Quarters, by such amount as is necessary
to reflect the annualization of EBITDA using the following conventions:
(i) if the Project has been open for business for less than one (1) full
Fiscal Quarter, no annualization adjustment shall be made, (ii) if the
Project has been open for business for one (1) full Fiscal Quarter,
EBITDA for that Fiscal Quarter shall be multiplied by four, (iii) if the
Project has been open for business two (2) full Fiscal Quarters, EBITDA
for those Fiscal Quarters shall be multiplied by two and (iv) if the
Project has been open for business for three (3) full Fiscal Quarters,
EBITDA for those Fiscal Quarters shall be multiplied by four
thirds (4/3).
"ARCHITECT" means Xxxxxx & Xxxxx Architects, or any other architect
selected by Borrower and approved by the Managing Agent (which approval
shall not be unreasonably withheld).
"ARCHITECT'S CERTIFICATE AND CONSENT" means a written certificate
and consent executed by the Architect substantially in the form of
EXHIBIT A.
"ARCHITECT CONTRACTS" means the contract between the Architect and
Borrower dated as of September 17th, 1996 and any other contract between
the Architect and Borrower approved by the Managing Agent relating to the
design and construction of the Project and the preparation of the
Construction Plans, together with all amendments thereto.
"ARRANGER" means Bank of America National Trust and Savings
Association.
"AVAILABILITY TERMINATION DATE" means the EARLIER OF (a) the date
that is ninety (90) days after the Completion Date or (b) December 31,
1997.
"BANKING DAY" means any Monday, Tuesday, Wednesday, Thursday or
Friday, OTHER THAN a day on which banks are authorized or required to be
closed in California, Nevada or New York.
"BORROWER" has the meaning set forth in the introduction to this
Agreement.
"CAPITAL EXPENDITURE" means any expenditure that is treated as a
capital expenditure under Generally Accepted Accounting Principles,
INCLUDING any amount which is required to be treated as an asset subject
to a Capital Lease Obligation and including interest required by
Generally Accepted Accounting Principles to be capitalized with respect
to such an expenditure.
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"CAPITAL LEASE OBLIGATIONS" means all monetary obligations of a
Person under any leasing or similar arrangement which, in accordance with
Generally Accepted Accounting Principles, is classified as a capital
lease.
"CASH" means, when used in connection with any Person, all monetary
and non-monetary items owned by that Person that are treated as cash in
accordance with Generally Accepted Accounting Principles, consistently
applied.
"CASH EQUITY CONTRIBUTIONS" means contributions made by Parent to
the equity capital of Borrower that (a) are made in the form of Cash or
Cash Equivalents, (b) do not bear any specified or determinable dividend
rate and (c) are not redeemable prior to the date that is one year after
the Maturity Date.
"CASH EQUIVALENTS" means, when used in connection with any Person,
that Person's Investments in:
(a) Government Securities due within one year after the date
of the making of the Investment;
(b) readily marketable direct obligations of any State of the
United States of America or any political subdivision of any such
State or any public agency or instrumentality thereof given on the
date of such Investment a credit rating of at least Aa by Xxxxx'x
Investors Service, Inc. or AA by Standard & Poor's Rating Group (a
division of XxXxxx-Xxxx, Inc.) in each case due within one year from
the making of the Investment;
(c) certificates of deposit issued by, bank deposits in,
eurodollar deposits through, bankers' acceptances of, and repurchase
agreements covering Government Securities executed by any Lender or
by any bank incorporated under the Laws of the United States of
America, any State thereof or the District of Columbia and having on
the date of such Investment combined capital, surplus and undivided
profits of at least $250,000,000, or total assets of at least
$5,000,000,000, in each case due within one year after the date of
the making of the Investment;
(d) certificates of deposit issued by, bank deposits in,
eurodollar deposits through, bankers' acceptances of, and repurchase
agreements covering Government Securities executed by any branch or
office located in the United States of America of a bank
incorporated under the Laws of any jurisdiction outside the United
States of America having on the date of such Investment combined
capital, surplus and undivided profits of at least $500,000,000, or
total assets of at least $15,000,000,000, in each case due within
one year after the date of the making of the Investment;
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(e) repurchase agreements covering Government Securities
executed by a broker or dealer registered under Section 15(b) of the
Securities Exchange Act of 1934, as amended, having on the date of
the Investment capital of at least $50,000,000, due within 90 days
after the date of the making of the Investment; PROVIDED that the
maker of the Investment receives written confirmation of the
transfer to it of record ownership of the Government Securities on
the books of a "primary dealer" in such Government Securities or on
the books of such registered broker or dealer, as soon as
practicable after the making of the Investment;
(f) readily marketable commercial paper or other debt
securities issued by corporations doing business in and incorporated
under the Laws of the United States of America or any State thereof
or of any corporation that is the holding company for a bank
described in clause (c) or (d) above given on the date of such
Investment a credit rating of at least P-1 by Xxxxx'x Investors
Service, Inc. or A-1 by Standard & Poor's Rating Group (a division
of XxXxxx-Xxxx, Inc.), in each case due within one year after the
date of the making of the Investment;
(g) "money market preferred stock" issued by a corporation
incorporated under the Laws of the United States of America or any
State thereof (i) given on the date of such Investment a credit
rating of at least Aa by Xxxxx'x Investors Service, Inc. and AA by
Standard & Poor's Rating Group (a division of XxXxxx-Xxxx, Inc.), in
each case having an investment period not exceeding 50 days or
(ii) to the extent that investors therein have the benefit of a
standby letter of credit issued by a Lender or a bank described in
clauses (c) or (d) above; PROVIDED that (y) the amount of all such
Investments issued by the same issuer does not exceed $5,000,000 and
(z) the aggregate amount of all such Investments does not exceed
$15,000,000;
(h) a readily redeemable "money market mutual fund" sponsored
by a bank described in clause (c) or (d) hereof, or a registered
broker or dealer described in clause (e) hereof, that has and
maintains an investment policy limiting its investments primarily to
instruments of the types described in clauses (a) through (g) hereof
and given on the date of such Investment a credit rating of at least
Aa by Xxxxx'x Investors Service, Inc. and AA by Standard & Poor's
Rating Group (a division of XxXxxx-Xxxx, Inc.); and
(i) corporate notes or bonds having an original term to
maturity of not more than one year issued by a corporation
incorporated under the Laws of the United States of America or any
State thereof, or a participation interest therein; PROVIDED that
(i) any commercial paper issued by such corporation is given on the
date of such Investment a credit
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rating of at least Aa by Xxxxx'x Investors Service, Inc. and AA by
Standard & Poor's Rating Group (a division of XxXxxx-Xxxx, Inc.),
(ii) the amount of all such Investments issued by the same issuer
does not exceed $5,000,000 and (iii) the aggregate amount of all
such Investments does not exceed $15,000,000.
"CASH INTEREST EXPENSE" means Interest Expense that is paid, or is
currently payable, in Cash.
"CASH TAXES" means, with respect to any fiscal period, taxes on or
measured by the income of Borrower for that fiscal period, to the extent
paid, or currently payable, in Cash with respect to that fiscal period.
"CERTIFICATE" means a certificate signed by a Senior Officer or
Responsible Official (as applicable) of the Person providing the
certificate.
"CHANGE OF OWNERSHIP" means any transfer of any equity ownership
interest in Borrower (or the issuance by Borrower of any equity ownership
interest in Borrower) to any Person OTHER THAN Parent.
"CLOSING DATE" means the time and Banking Day on which the
conditions set forth in Section 9.1 are satisfied or waived. The
Managing Agent shall notify Borrower and the Lenders of the date that is
the Closing Date.
"CO-AGENTS" means Bank of Scotland and Societe Generale. The
Co-Agents shall have no rights, duties or responsibilities under the Loan
Documents beyond those of a Lender.
"CODE" means the Internal Revenue Code of 1986, as amended or
replaced and as in effect from time to time.
"COLLATERAL" means all of the collateral covered by the Collateral
Documents.
"COLLATERAL ASSIGNMENT" means the collateral assignment of the
Architect Contracts, the Construction Contracts and the Construction
Plans to be executed and delivered by Borrower in the form of EXHIBIT B,
either as originally executed or as it may from time to time be
supplemented, modified, amended, extended or supplanted.
"COLLATERAL DOCUMENTS" means, collectively, the Security Agreement,
the Collateral Assignment, the Pledge Agreement, the Deed of Trust and
any other security agreement, pledge agreement, deed of trust, mortgage
or other collateral security agreement hereafter executed and delivered
by Borrower, any of its Subsidiaries or Parent to secure the Obligations.
"COMMITMENT" means, subject to Sections 2.4 and 2.5,
$110,000,000.00. As of the Closing Date, the respective Pro Rata
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Shares of the Lenders with respect to the Commitment are set forth in
SCHEDULE 1.1.
"COMMITMENT ASSIGNMENT AND ACCEPTANCE" means a commitment assignment
and acceptance substantially in the form of EXHIBIT C.
"COMPLETION DATE" means the date upon which the Project is open for
business to the general public with (a) at least 95% of the hotel rooms
provided for in the Construction Plans ready for occupancy, (b) at least
95% of the square footage of casino space provided for in the
Construction Plans ready for gaming and (c) substantially all other
amenities of the Project substantially complete.
"COMPLETION GUARANTY" means the completion guaranty to be executed
and delivered by Parent in the form of EXHIBIT D, either as originally
executed or as it may from time to time be supplemented, modified,
amended, extended or supplanted.
"COMPLIANCE CERTIFICATE" means a certificate in the form of EXHIBIT
E, properly completed and signed by a Senior Officer of Borrower.
"CONSTRUCTION BUDGET" means the itemized schedule delivered by
Borrower to the Managing Agent on or before the Closing Date setting
forth on a line item basis, to the reasonable satisfaction of the
Managing Agent and the Lenders, all of the anticipated costs (INCLUDING
financing expenses and Pre-Opening Expenses) of construction of the
Project and the acquisition of the Leased Equipment.
"CONSTRUCTION CONTRACTS" means that certain Building Contract dated
November 1, 1996 between Borrower and the Contractor and any other
contract between the Contractor and Borrower relating to the construction
of the Project (subject to ARTICLE 7), together with all amendments
thereto.
"CONSTRUCTION PERIOD" means the period commencing on the Closing
Date and ending on the Completion Date.
"CONSTRUCTION PLANS" means all drawings, plans and specifications
relating to the Project prepared by or for Parent or Borrower, as the
same may be amended or supplemented from time to time, and, if required,
submitted to and approved by the Xxxxx County Building Department, all of
which plans and specifications describe and set forth the plans and
specifications for the construction of the Project and the labor and
materials necessary for the construction thereof.
"CONSTRUCTION TIMETABLE" means the detailed timetable for the
construction of the Project in accordance with the Construction Plans and
Construction Budget.
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"CONTRACTOR" means Tiberti Construction Company, and/or any other
general contractor selected by Borrower and approved by the Managing
Agent (which approval shall not be unreasonably withheld).
"CONTRACTOR'S CERTIFICATE AND CONSENT" means a written certificate
and consent executed by the Contractor substantially in the form of
EXHIBIT F.
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of
any outstanding security issued by that Person or of any material
agreement, instrument or undertaking to which that Person is a party or
by which it or any of its Property is bound.
"CSG" means Bank of America Construction Services Group.
"DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States
of America, as amended from time to time, and all other applicable
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar debtor relief Laws
from time to time in effect affecting the rights of creditors generally.
"DEED OF TRUST" means the deed of trust to be executed and delivered
by Borrower covering the Project Property in the form of EXHIBIT G,
either as originally executed or as it may from time to time be
supplemented, modified, amended, extended or supplanted.
"DEFAULT" means any event that, with the giving of any applicable
notice or passage of time specified in Section 10.1, or both, would be an
Event of Default.
"DEFAULT RATE" means the interest rate prescribed in Section 3.10.
"DESIGNATED DEPOSIT ACCOUNT" means a deposit account to be
maintained by Borrower with Bank of America National Trust and Savings
Association or one of its Affiliates, as from time to time designated by
Borrower by written notification to the Managing Agent.
"DESIGNATED EURODOLLAR MARKET" means, with respect to any Eurodollar
Rate Loan, (a) the London Eurodollar Market, (b) if prime banks in the
London Eurodollar Market are at the relevant time not accepting deposits
of Dollars or if the Managing Agent determines in good faith that the
London Eurodollar Market does not represent at the relevant time the
effective pricing to the Lenders for deposits of Dollars in the London
Eurodollar Market, the Cayman Islands Eurodollar Market or (c) if prime
banks in both the London and Cayman Islands Eurodollar Markets are at the
relevant time not accepting deposits of Dollars or if the Managing Agent
determines in good faith that neither the London nor the Cayman Islands
Eurodollar Market represents at the relevant time the effective pricing
to the Lenders for deposits of Dollars in such Euro
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dollar Market, such other Eurodollar Market as may from time to time be
selected by the Managing Agent with the approval of Borrower and the
Requisite Lenders.
"DISPOSITION" means the voluntary sale, transfer or other
disposition of any asset of Borrower or any of its Subsidiaries OTHER
THAN (a) Cash, Cash Equivalents, inventory or other assets sold, leased
or otherwise disposed of in the ordinary course of business of Borrower
or any of its Subsidiaries and (b) equipment sold or otherwise disposed
of where substantially similar equipment in replacement thereof has
theretofore been acquired, or thereafter within 90 days is acquired, by
Borrower or any of its Subsidiaries, or where Borrower or the Subsidiary
determine in good faith that the failure to replace such equipment will
not be detrimental to the business of Borrower or any of its
Subsidiaries.
"DISQUALIFIED STOCK" means any capital stock, warrants, options or
other rights to acquire capital stock (but excluding any debt security
which is convertible, or exchangeable, for capital stock), which, by its
terms (or by the terms of any security into which it is convertible or
for which it is exchangeable), or upon the happening of any event,
matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is one year
following the Maturity Date; PROVIDED that the aforementioned interests
shall not be Disqualified Stock if they are redeemable prior to the date
that is one year following the Maturity Date only if the board of
directors of Parent determines in its judgment that as a result of a
holder or beneficial owner owning such interests (i) Borrower has lost or
may lose any license or franchise from any Gaming Board held by Borrower
or any Subsidiary of Borrower necessary to conduct any portion of the
business of Borrower or (ii) any Gaming Board has taken or may take
action to materially restrict or impair the operations of Borrower, which
license, franchise or action is conditioned upon some or all of the
holders or beneficial owners of such interests being licensed or found
qualified or suitable to own such interests.
"DISTRIBUTION" means, with respect to any shares of capital stock or
any warrant or option to purchase an equity security or other equity
security issued by a Person, (a) the retirement, redemption, purchase or
other acquisition for Cash or for Property by such Person of any such
security, (b) the declaration or (without duplication) payment by such
Person of any dividend in Cash or in Property on or with respect to any
such security, (c) any Investment by such Person in the holder of 5% or
more of any such security if a purpose of such Investment is to avoid
characterization of the transaction as a Distribution and (d) any other
payment in Cash or Property by such Person constituting a distribution
under applicable Laws with respect to such security.
"DOLLARS" or "$" means United States dollars.
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"EBITDA" means, with respect to any fiscal period, the SUM OF
(a) the Net Income of Borrower and its Subsidiaries for that period, PLUS
(b) any non-operating non-recurring loss (INCLUDING any loss resulting
from Pre-Opening Expenses) reflected in such Net Income, MINUS (c) any
non-operating non-recurring gain reflected in such Net Income, PLUS
(d) Interest Expense for that period, PLUS (e) the aggregate amount of
federal and state taxes on or measured by income of Borrower and its
Subsidiaries for that period (whether or not payable during that period)
PLUS (f) depreciation, amortization and all other non-cash expenses
(INCLUDING any non-cash Management Fees) of Borrower and its Subsidiaries
for that period, in each case as determined in accordance with Generally
Accepted Accounting Principles.
"EFFECTED CURE" means the receipt by Borrower of a Cash Equity
Contribution or Supplemental Loan (or any combination of both) in an
amount (a) in the case of a failure to comply with Section 6.11, which,
when included in the calculation of the denominator of the Senior Funded
Debt Ratio, would result in compliance with such Section, (b) in the case
of a failure to comply with Section 6.12, which, when included in the
calculation of the numerator of the Fixed Charge Coverage Ratio, would
result in compliance with such Section and (c) in the case of a failure
to comply with Section 6.13, which, when included in the calculation of
Effective Net Worth, would result in compliance with such Section. An
Effected Cure received by Borrower not later than the date that is 45
days after the end of the Fiscal Quarter as of which such failure to
comply existed shall be deemed to have been effected as of the end of
such Fiscal Quarter.
"EFFECTIVE NET WORTH" means, as of any date of determination, the
SUM OF (a) the Stockholders' Equity of Borrower on that date, PLUS
(b) the amount (not in excess of $7,000,000) of Pre-Opening Expenses
expended by Borrower through that date PLUS (c) the outstanding principal
amount of all outstanding Supplemental Loans on that date.
"ELIGIBLE ASSIGNEE" means (a) another Lender, (b) with respect to
any Lender, any Affiliate of that Lender, (c) any commercial bank having
a combined capital and surplus of $100,000,000 or more, (d) any
(i) savings bank, savings and loan association or similar financial
institution or (ii) insurance company engaged in the business of writing
insurance which, in either case (A) has a net worth of $200,000,000 or
more, (B) is engaged in the business of lending money and extending
credit under credit facilities substantially similar to those extended
under this Agreement and (C) is operationally and procedurally able to
meet the obligations of a Lender hereunder to the same degree as a
commercial bank and (e) any other financial institution (INCLUDING a
mutual fund or other fund) having total assets of $250,000,000 or more
which meets the requirements set forth in subclauses (B) and (C) of
clause (d) above; PROVIDED that (I) each Eligible Assignee must either
(a) be organized under the Laws of the United States of America, any
State thereof or the District of Columbia or (b) be organized under the
Laws of the
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Xxxxxx Xxxxxxx or any country which is a member of the Organization for
Economic Cooperation and Development, or a political subdivision of such
a country, and (i) act hereunder through a branch, agency or funding
office located in the United States of America and (ii) be exempt from
withholding of tax on interest and deliver the documents related thereto
pursuant to Section 12.21 and (II) to the extent required under
applicable Gaming Laws, each Eligible Assignee must be registered with,
approved by, or not disapproved by (whichever may be required under
applicable Gaming Laws), all applicable Gaming Boards.
"EQUIPMENT LEASE" means the equipment lease dated as of the Closing
Date between the Equipment Lessors and Parent (as lessee and as sublessor
under the Equipment Sublease) covering the Leased Equipment.
"EQUIPMENT SUBLEASE" means the equipment sublease dated as of the
Closing Date between Parent and Borrower covering the Leased Equipment.
"EQUIPMENT LESSORS" means, collectively, the Lessor under the
Equipment Lease and the Holders under the related Participation
Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974,
and any regulations issued pursuant thereto, as amended or replaced and
as in effect from time to time.
"ERISA AFFILIATE" means each Person (whether or not incorporated)
which is required to be aggregated with Borrower pursuant to Section 414
of the Code.
"EURODOLLAR BANKING DAY" means any Banking Day on which dealings in
Dollar deposits are conducted by and among banks in the Designated
Eurodollar Market.
"EURODOLLAR LENDING OFFICE" means, as to each Lender, its office or
branch so designated by written notice to Borrower and the Managing Agent
as its Eurodollar Lending Office. If no Eurodollar Lending Office is
designated by a Lender, its Eurodollar Lending Office shall be its office
at its address for purposes of notices hereunder.
"EURODOLLAR MARKET" means a regular established market located
outside the United States of America by and among banks for the
solicitation, offer and acceptance of Dollar deposits in such banks.
"EURODOLLAR OBLIGATIONS" means eurocurrency liabilities, as defined
in Regulation D or any comparable regulation of any Governmental Agency
having jurisdiction over any Lender.
"EURODOLLAR PERIOD" means, as to each Eurodollar Rate Loan, the
three (3) month period commencing on the related Eurodollar Period
Commencement Date, PROVIDED that:
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(a) On and after July 1, 2000, Borrower may by written notice
to the Managing Agent, delivered at least three (3) Eurodollar
Banking Days prior to the end of an expiring Eurodollar Period,
designate Eurodollar Periods of one (1) or two (2) months for all or
a portion of any Eurodollar Rate Loan expiring on or after that
date;
(b) Borrower may at any time after the Permitted Refi Date
deliver to the Managing Agent written notice of its good faith
intention to refinance the Indebtedness outstanding under this
Agreement within the period ending on the last day of the Eurodollar
Period that is then approximately three months from such date and,
on and after such date and for so long as Borrower continues to hold
such good faith intention, Borrower may by written notice to the
Managing Agent designate Eurodollar Periods of one (1) or two (2)
months for all or any part of any Eurodollar Rate Loan expiring
during such period;
(c) Any Eurodollar Period that would otherwise end on a day
that is not a Eurodollar Banking Day shall be extended to the next
succeeding Eurodollar Banking Day unless such Eurodollar Banking Day
falls in another calendar month, in which case such Eurodollar
Period shall end on the next preceding Eurodollar Banking Day; and
(d) No Eurodollar Period shall extend beyond the Maturity
Date.
"EURODOLLAR PERIOD COMMENCEMENT DATE" means (a) in the case of a
Eurodollar Rate Loan into which an Alternate Base Rate Loan is converted
pursuant to Section 3.1(b), the Eurodollar Banking Day nearest to the
first day of the calendar month following the calendar month in which
such Alternate Base Rate Loan was made (or, if there is no such nearest
Eurodollar Banking Day, then the last Eurodollar Banking Day in the
calendar month in which such Alternate Base Rate Loan was made);
PROVIDED, however, that (i) if such Eurodollar Banking Day is not at
least three (3) Eurodollar Banking Days after the date such Alternate
Base Rate Loan was made, then the Eurodollar Period Commencement Date
shall be the first Eurodollar Banking Day that is at least three (3)
Eurodollar Banking Days after the date such Alternate Base Rate Loan was
made and (ii) in any event, if such Eurodollar Banking Day does not
coincide with the last day of the Eurodollar Period for another
Eurodollar Rate Loan (if any) expiring on or about the first day of such
calendar month, then the Eurodollar Commencement Date shall be the last
day of the Eurodollar Period for such expiring other Eurodollar Rate Loan
and (b) in the case of a Eurodollar Rate Loan into which an expiring
Eurodollar Rate Loan is converted pursuant to Section 3.1(c), the last
day of the Eurodollar Period for that expiring Eurodollar Rate Loan.
"EURODOLLAR RATE" means, with respect to any Eurodollar Rate Loan,
the interest rate per annum (rounded upward, if necessary, to the next
1/100 of 1%) at which deposits in Dollars are offered by
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Bank of America, N.T. & S.A., to prime banks in the Designated Eurodollar
Market at or about 11:00 a.m. local time in the Designated Eurodollar
Market, two (2) Eurodollar Banking Days before the first day of the
applicable Eurodollar Period in an aggregate amount approximately equal
to the amount of the Advance made by Bank of America, N.T.&S.A. with
respect to such Eurodollar Rate Loan and for a period of time comparable
to the number of days in the applicable Eurodollar Period.
"EURODOLLAR RATE ADVANCE" means, with respect to any Lender, the
portion of a Eurodollar Rate Loan that is equal to such Lender's Pro Rata
Share of such Eurodollar Rate Loan.
"EURODOLLAR RATE LOAN" means a Loan made hereunder that is a
Eurodollar Rate Loan in accordance with ARTICLE 2.
"EVENT OF DEFAULT" shall have the meaning provided in Section 10.1.
"EXCESS CASH FLOW" means, as of the last day of any Fiscal Year
ending after the Completion Date, Adjusted Annualized EBITDA for that
Fiscal Year MINUS the SUM OF (a) Cash Interest Expense for that Fiscal
Year, PLUS (b) Cash Taxes for that Fiscal Year, PLUS (c) the aggregate of
(i) all principal payments on the Notes during that Fiscal Year required
by Section 3.1(e)(ii) and (ii) all voluntary principal prepayments on the
Notes to the extent that such prepayment reduced or eliminated the amount
of any subsequent principal payment on the Notes which would otherwise be
required by Section 3.1(e)(ii) during that Fiscal Year, PLUS (d) the
aggregate of any other scheduled payments or mandatory prepayments of
Senior Funded Debt of Borrower during that Fiscal Year PLUS (e) the
aggregate of all Maintenance Capital Expenditures made by Borrower during
that Fiscal Year and permitted by Section 6.14.
"FEDERAL FUNDS RATE" means, as of any date of determination, the
rate set forth in the weekly statistical release designated as H.15(519),
or any successor publication, published by the Federal Reserve Board
(including any such successor, "H.15(519)") for such date opposite the
caption "Federal Funds (Effective)". If for any relevant date such rate
is not yet published in H.15(519), the rate for such date will be the
rate set forth in the daily statistical release designated as the
Composite 3:30 p.m. Quotations for U.S. Government Securities, or any
successor publication, published by the Federal Reserve Bank of New York
(including any such successor, the "Composite 3:30 p.m. Quotation") for
such date under the caption "Federal Funds Effective Rate". If on any
relevant date the appropriate rate for such date is not yet published in
either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such
date will be the arithmetic mean of the rates for the last transaction in
overnight Federal funds arranged prior to 9:00 a.m. (New York City time)
on that date by each of three leading brokers of Federal funds
transactions in New York City selected by the Managing Agent. For
purposes of this Agreement, any change in the Alternate
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Base Rate due to a change in the Federal Funds Rate shall be effective as
of the opening of business on the effective date of such change.
"FIRREA" means the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as it may be amended from time to time.
"FISCAL QUARTER" means the fiscal quarter of Borrower consisting of
the three calendar month periods ending on each March 31, June 30,
September 30 and December 31.
"FISCAL YEAR" means the fiscal year of Borrower ending on each
March 31.
"FIXED CHARGE COVERAGE RATIO" means, as of the last day of any
Fiscal Quarter ending after the Completion Date, the RATIO OF (a) the
RESULT OBTAINED by subtracting (i) Adjusted Annualized EBITDA for the
fiscal period consisting of that Fiscal Quarter and the three immediately
preceding Fiscal Quarters MINUS (ii) Cash Taxes for that fiscal period TO
(b) the SUM OF (i) Interest Charges for that fiscal period, PLUS (ii) the
aggregate of (A) all principal payments on the Notes made during that
fiscal period required by Section 3.1(e)(ii) and (B) all voluntary
principal prepayments on the Notes made during such fiscal period to the
extent that such prepayment reduced or eliminated the amount of a
subsequent principal payment on the Notes which would otherwise be
required by Section 3.1(e)(ii) during that fiscal period, PLUS (iii) the
aggregate of any other scheduled payments or mandatory prepayments of
Senior Funded Debt of Borrower during that fiscal period PLUS (iv) all
Maintenance Capital Expenditures during that fiscal period.
"GAMING BOARD" means, collectively, (a) the Nevada Gaming
Commission, (b) the Nevada State Gaming Control Board and (c) any other
Governmental Agency that holds regulatory, licensing or permit authority
over gambling, gaming or casino activities conducted by Borrower and its
Subsidiaries within its jurisdiction.
"GAMING LAWS" means all Laws pursuant to which any Gaming Board
possesses regulatory, licensing or permit authority over gambling, gaming
or casino activities conducted by Borrower and its Subsidiaries within
its jurisdiction.
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means, as of any date of
determination, accounting principles (a) set forth as generally accepted
in then currently effective Opinions of the Accounting Principles Board
of the American Institute of Certified Public Accountants, (b) set forth
as generally accepted in then currently effective Statements of the
Financial Accounting Standards Board or (c) that are then approved by
such other entity as may be approved by a significant segment of the
accounting profession in the United States of America. The term
"CONSISTENTLY APPLIED," as used in connection therewith, means that the
accounting principles applied
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are consistent in all material respects with those applied at prior dates
or for prior periods.
"GOVERNMENT SECURITIES" means readily marketable (a) direct full
faith and credit obligations of the United States of America or
obligations guaranteed by the full faith and credit of the United States
of America and (b) obligations of an agency or instrumentality of, or
corporation owned, controlled or sponsored by, the United States of
America that are generally considered in the securities industry to be
implicit obligations of the United States of America.
"GOVERNMENTAL AGENCY" means (a) any international, foreign, federal,
state, county or municipal government, or political subdivision thereof,
(b) any governmental or quasi-governmental agency, authority, board,
bureau, commission, department, instrumentality or public body (INCLUDING
any Gaming Board) or (c) any court or administrative tribunal of
competent jurisdiction.
"GUARANTY OBLIGATION" means, as to any Person (without duplication),
any (a) guarantee by that Person of Indebtedness of, or other obligation
performable by, any other Person or (b) assurance given by that Person to
an obligee of any other Person with respect to the performance of an
obligation by, or the financial condition of, such other Person, whether
direct, indirect or contingent, INCLUDING any purchase or repurchase
agreement covering such obligation or any collateral security therefor,
any agreement to provide funds (by means of loans, capital contributions
or otherwise) to such other Person, any agreement to support the solvency
or level of any balance sheet or income or cash flow statement item of
such other Person or any "keep-well" or other arrangement of whatever
nature given for the purpose of assuring or holding harmless such obligee
against loss with respect to any obligation of such other Person;
PROVIDED, HOWEVER, that the term Guaranty Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guaranty Obligation of
Indebtedness shall be deemed to be an amount equal to the stated or
determinable amount of the related Indebtedness (unless the Guaranty
Obligation is limited by its terms to a lesser amount, in which case to
the extent of such amount) or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
Person in good faith. The amount of any other Guaranty Obligation shall
be deemed to be zero unless and until the amount thereof has been (or in
accordance with Financial Accounting Standards Board Statement No. 5
should be) quantified and reflected or disclosed in the consolidated
financial statements (or notes thereto) of Borrower and its Subsidiaries.
"HAZARDOUS MATERIALS" means substances defined as "hazardous
substances" pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq.,
or as "hazardous", "toxic" or "pollutant" substances or as "solid waste"
pursuant to the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801, et seq., the Resource Conservation and Recovery Act,
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42 U.S.C. Section 6901, et seq., or as "friable asbestos" pursuant to the
Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq. or any other
applicable Hazardous Materials Law, in each case as such Laws are amended
from time to time.
"HAZARDOUS MATERIALS LAWS" means all Laws governing the treatment,
transportation or disposal of Hazardous Materials applicable to any of
the Real Property.
"INDEBTEDNESS" means, as to any Person (without duplication),
(a) indebtedness of such Person for borrowed money or for the deferred
purchase price of Property (excluding trade and other accounts payable in
the ordinary course of business in accordance with ordinary trade terms),
INCLUDING any Guaranty Obligation for any such indebtedness,
(b) indebtedness of such Person of the nature described in clause (a)
that is non-recourse to the credit of such Person but is secured by
assets of such Person, to the extent of the fair market value of such
assets as determined in good faith by such Person, (c) Capital Lease
Obligations of such Person, (d) indebtedness of such Person arising under
bankers' acceptance facilities or under facilities for the discount of
accounts receivable of such Person, (e) any direct or contingent
obligations of such Person under letters of credit issued for the account
of such Person and (f) any net obligations of such Person under Swap
Agreements; PROVIDED that in no event shall the obligations of a Person
under an operating lease (as such term is defined under Generally
Accepted Accounting Principles) be deemed Indebtedness of that Person.
Borrower and the Lenders acknowledge that the Equipment Sublease is an
operating lease and not Indebtedness.
"INITIAL AMORTIZATION DATE" means the last day of the Eurodollar
Period ending nearest to March 31, 1998.
"INTANGIBLE ASSETS" means assets that are considered intangible
assets under Generally Accepted Accounting Principles, INCLUDING customer
lists, goodwill, copyrights, trade names, trademarks and patents.
"INTERCREDITOR AGREEMENT" means an intercreditor agreement between
the Managing Agent (on behalf of the Lenders) and the Equipment Lessors
in the form of EXHIBIT H.
"INTEREST CHARGES" means, as of the last day of any fiscal period,
the SUM OF (a) Cash Interest Expense for that fiscal period, PLUS (b) all
interest currently payable in Cash incurred during that fiscal period
which is capitalized under Generally Accepted Accounting Principles.
"INTEREST DIFFERENTIAL" means, with respect to any prepayment of a
Eurodollar Rate Loan on a day other than the last day of the applicable
Interest Period (a) the Eurodollar Rate payable with respect to the
Eurodollar Rate Loan MINUS (b) the Eurodollar Rate on, or as near as
practicable to, the date of the prepayment for a
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Eurodollar Rate Loan with an Interest Period commencing on such date and
ending on the last day of the Interest Period of the Eurodollar Rate Loan
so prepaid.
"INTEREST EXPENSE" means, as of the last day of any fiscal period,
the SUM OF (a) all interest, fees, charges and related expenses paid or
payable (without duplication) for that fiscal period by Borrower and its
Subsidiaries to a lender in connection with borrowed money (INCLUDING any
obligations for fees, charges and related expenses payable to the issuer
of any letter of credit) or the deferred purchase price of assets that
are considered "interest expense" under Generally Accepted Accounting
Principles, PLUS (b) the portion of rent paid or payable (without
duplication) for that fiscal period by Borrower and its Subsidiaries
under Capital Lease Obligations that should be treated as interest in
accordance with Financial Accounting Standards Board Statement No. 13.
"INTEREST PERIOD" means, with respect to any Eurodollar Rate Loan,
the related Eurodollar Period.
"INVESTMENT" means, when used in connection with any Person, any
investment by or of that Person, whether by means of purchase or other
acquisition of stock or other securities of any other Person or by means
of a loan, advance creating a debt, capital contribution, guaranty or
other debt or equity participation or interest in any other Person,
INCLUDING any partnership and joint venture interests of such Person.
The amount of any Investment shall be the amount actually invested (MINUS
any return of capital with respect to such Investment which has actually
been received in Cash or Cash Equivalents or has been converted into Cash
or Cash Equivalents), without adjustment for subsequent increases or
decreases in the value of such Investment. An Investment in a Person
consisting of the guaranty of an obligation of such Person shall not be
deemed outstanding following the termination or expiration of such
guaranty. Swap Agreements shall not be deemed Investments.
"LANDLORD CONSENT AND AGREEMENT" means a Landlord consent and
agreement executed by the lessors under the Realty Lease substantially in
the form of EXHIBIT I.
"LAWS" means, collectively, all international, foreign, federal,
state and local statutes, treaties, rules, regulations, ordinances, codes
and administrative or judicial precedents.
"LEASED EQUIPMENT" means such items of equipment located on or
included within the Project as are designated by Borrower and acceptable
to the Equipment Lessors for inclusion under the Equipment Lease;
PROVIDED that the aggregate cost thereof to the Equipment Lessors does
not exceed $40,000,000.
"LENDER" is defined in the preamble to this Agreement.
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"LICENSE REVOCATION" means (a) the revocation, involuntary failure
to renew or suspension of any casino, gambling or gaming license issued
by any Gaming Board covering any casino or gaming facility of Borrower,
(b) the appointment by any Gaming Board of a receiver, supervisor or
similar official with respect to any such gaming facility or (c) the
involuntary closure of any such casino or gaming facility pursuant to an
order of any Gaming Board.
"LIEN" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, lien or charge
of any kind, whether voluntarily incurred or arising by operation of Law
or otherwise, affecting any Property, INCLUDING any currently effective
agreement to grant any of the foregoing, any conditional sale or other
title retention agreement, any lease in the nature of a security
interest, and/or the filing of or currently effective agreement to give
any financing statement (OTHER THAN a precautionary financing statement
with respect to a lease that is not in the nature of a security interest)
under the Uniform Commercial Code or comparable Law of any jurisdiction
with respect to any Property.
"LOAN" means the aggregate of the Advances made at any one time by
the Lenders pursuant to ARTICLE 2.
"LOAN DOCUMENTS" means, collectively, this Agreement, the Notes, the
Collateral Documents, the Completion Guaranty, the Subsidiary Guaranty,
any Secured Swap Agreement and any other agreements of any type or nature
hereafter executed and delivered by Borrower, any of its Subsidiaries or
Parent to the Managing Agent or to any Lender in any way relating to or
in furtherance of this Agreement, in each case either as originally
executed or as the same may from time to time be supplemented, modified,
amended, restated, extended or supplanted.
"MAINTENANCE CAPITAL EXPENDITURE" means a Capital Expenditure for
the maintenance, repair, restoration or refurbishment of the Project
following the Availability Termination Date, EXCLUDING any Capital
Expenditure which materially adds to or further improves the Project.
"MANAGING AGENT" means Bank of America National Trust and Savings
Association, when acting in its capacity as the Managing Agent under any
of the Loan Documents, or any successor Managing Agent.
"MANAGING AGENT'S OFFICE" means the Managing Agent's address as set
forth on the signature pages of this Agreement, or such other address as
the Managing Agent hereafter may designate by written notice to Borrower
and the Lenders.
"MANAGEMENT FEE" means (a) a fee paid or accrued to any Person for
management, auditing or other administrative services provided to
Borrower, however denominated, and (b) reimbursement to any Person
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for any expenditure made by that Person for the benefit of Borrower which
expenditure was not solely and directly for the benefit of Borrower.
"MARGIN STOCK" means "margin stock" as such term is defined in
Regulation G or U.
"MATERIAL ADVERSE EFFECT" means any set of circumstances or events
which (a) has or could reasonably be expected to have any material
adverse effect whatsoever upon the validity or enforceability of any Loan
Document (other than as a result of any action or inaction of the
Managing Agent or any Lender), (b) is or could reasonably be expected to
be material and adverse to the business or condition (financial or
otherwise) of Borrower and its Subsidiaries, taken as a whole or
(c) materially impairs or could reasonably be expected to materially
impair the ability of Borrower to perform the Obligations.
"MATURITY DATE" means September 30, 2000.
"MULTIEMPLOYER PLAN" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA to which Borrower or any of its
ERISA Affiliates contribute or are obligated to contribute.
"NEGATIVE PLEDGE" means a Contractual Obligation that contains a
covenant binding on Borrower or any of its Subsidiaries that prohibits
Liens on any of its or their Property, OTHER THAN (a) any such covenant
contained in a Contractual Obligation granting a Lien permitted under
Section 6.8 which affects only the Property that is the subject of such
permitted Lien and (b) any such covenant that does not apply to Liens
securing the Obligations.
"NET CASH PROCEEDS" means, with respect to a Disposition, (a) the
Cash proceeds of such Disposition received by Borrower net of (i) the
expenses incurred by Borrower in connection therewith, (ii) the amount of
any Indebtedness secured by a Lien on the Property which is the subject
thereof which Borrower is required to discharge and (iii) the reasonably
estimated income, capital gains and other taxes payable by Borrower in
connection therewith and (b) all Cash proceeds and collections of Cash
received by Borrower with respect to any promissory note or non-Cash
Property received by Borrower upon such Disposition.
"NET INCOME" means, with respect to any fiscal period, the
consolidated net income of Borrower and its Subsidiaries for that period,
determined in accordance with Generally Accepted Accounting Principles,
consistently applied.
"NOTE" means the promissory note made by Borrower to a Lender
evidencing the Advances under that Lender's Pro Rata Share of the
Commitment, substantially in the form of EXHIBIT J, either as
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originally executed or as the same may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.
"OBLIGATIONS" means, collectively, the Obligations of Borrower and
the Obligations of Parent.
"OBLIGATIONS OF BORROWER" means all present and future obligations
of every kind or nature of Borrower at any time and from time to time
owed to the Managing Agent or the Lenders or any one or more of them,
under any one or more of the Loan Documents, whether due or to become
due, matured or unmatured, liquidated or unliquidated, or contingent or
noncontingent, INCLUDING obligations of performance as well as
obligations of payment, and INCLUDING interest that accrues after the
commencement of any proceeding under any Debtor Relief Law by or against
Borrower.
"OBLIGATIONS OF PARENT" means all present and future obligations of
every kind or nature of Parent under the Completion Guaranty, whether due
or to become due, matured or unmatured, liquidated or unliquidated, or
contingent or noncontingent, INCLUDING obligations of performance as well
as payment.
"OPINIONS OF COUNSEL" means the favorable written legal opinions of
(a) Milbank, Tweed, Xxxxxx & XxXxxx, special counsel to Borrower, and
(b) Schreck, Jones, Bernhard, Woloson & Xxxxxxx, special Nevada counsel
to Borrower, substantially in the form of EXHIBITS K-1 and K-2,
respectively, together with copies of all factual certificates and legal
opinions delivered to such counsel in connection with such opinion upon
which such counsel has relied.
"PARENT" means Station Casinos, Inc.
"PARENT BANK CREDIT FACILITY" means the credit facility extended to
certain of the Subsidiaries of Parent pursuant to that certain Amended
and Restated Reducing Revolving Loan Agreement dated as of March 19,
1996, as the same may hereafter be amended, refinanced or replaced.
"PARENT CHANGE OF CONTROL" means (a) any transaction or series of
related transactions in which any Unrelated Person or two or more
Unrelated Persons acting in concert acquire beneficial ownership (within
the meaning of Rule 13d-3(a)(1) under the Securities Exchange Act of
1934, as amended), directly or indirectly, of 40% or more of the
outstanding Common Stock and at such time the Existing Equity Holders
together shall fail to beneficially own, directly or indirectly, at least
the same percentage of Common Stock as is beneficially owned by such
Unrelated Person, (b) Parent consolidates with or merges into another
Person or conveys, transfers or leases its properties and assets
substantially as an entirety to any Person or any Person consolidates
with or merges into Parent, in either event pursuant to a transaction in
which the outstanding Common Stock is changed into or exchanged for cash,
securities or other property, with the effect that any Unrelated Person
(OTHER THAN the Existing
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Equity Holders) becomes the beneficial owner, directly or indirectly, of
40% or more of Common Stock and at such times the Existing Equity Holders
together shall fail to beneficially own, directly or indirectly, at least
the same percentage of Common Stock as is beneficially owned by such
Unrelated person or (c) during any period of 24 consecutive months,
individuals who at the beginning of such period constituted the board of
directors of Parent (together with any new or replacement directors whose
election by the board of directors, or whose nomination for election, was
approved by a vote of at least a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for reelection was previously so approved) cease for
any reason to constitute a majority of the directors then in office. For
purposes of the foregoing, the term "UNRELATED PERSON" means any Person
OTHER THAN (i) a Subsidiary of Parent, (ii) an employee stock ownership
plan or other employee benefit plan covering the employees of Parent and
its Subsidiaries or (iii) any of the Existing Equity Holders, the term
"EXISTING EQUITY HOLDERS" means Xxxxx X. Xxxxxxxx III, Xxxxx X. Xxxxxxx,
Xxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxxxx, Xxxxx X. Xxxxxxxxxxx, Xxxxxx X.
Xxxxxxx and Xxxxx X. Xxxxxxx and their executors, administrators or the
legal representatives of their estates, their heirs, distributees and
beneficiaries, any trust as to which any of the foregoing is a settlor or
co-settlor and any corporation, partnership or other entity which is an
Affiliate of any of the foregoing, and any lineal descendants of such
Persons, but only to the extent that the beneficial ownership of Common
Stock held by such lineal descendants was directly received (by gift, trust
or sale) from any such Person and the term "COMMON STOCK" means the voting
common stock of Parent.
"PARTY" means any Person other than the Managing Agent and the
Lenders, which now or hereafter is a party to any of the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereof established under ERISA.
"PENSION PLAN" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), OTHER THAN a Multiemployer Plan,
which is subject to Title IV of ERISA and is maintained by Borrower or any
of its ERISA Affiliates or to which Borrower or any of its ERISA Affiliates
contributes or has an obligation to contribute.
"PERMITTED ENCUMBRANCES" means:
(a) inchoate Liens incident to construction on or maintenance of
Property; or Liens incident to construction on or maintenance of
Property now or hereafter filed of record for which adequate reserves
have been set aside (or deposits made pursuant to applicable Law) and
which are being contested in good faith by appropriate proceedings and
have not proceeded to judgment, PROVIDED that, by reason of nonpayment
of the
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obligations secured by such Liens, no such Property is subject to a
material impending risk of loss or forfeiture;
(b) Liens for taxes and assessments on Property which are not
yet past due; or Liens for taxes and assessments on Property for which
adequate reserves have been set aside and are being contested in good
faith by appropriate proceedings and have not proceeded to judgment,
PROVIDED that, by reason of nonpayment of the obligations secured by
such Liens, no such Property is subject to a material impending risk
of loss or forfeiture;
(c) minor defects and irregularities in title to any Property
which in the aggregate do not materially impair the fair market value
or use of the Property for the purposes for which it is or may
reasonably be expected to be held;
(d) easements, exceptions, reservations, or other agreements for
the purpose of pipelines, conduits, cables, wire communication lines,
power lines and substations, streets, trails, walkways, drainage,
irrigation, water, and sewerage purposes, dikes, canals, ditches, the
removal of oil, gas, coal, or other minerals, and other like purposes
affecting Property which in the aggregate do not materially burden or
impair the fair market value or use of such Property for the purposes
for which it is or may reasonably be expected to be held;
(e) easements, exceptions, reservations, or other agreements for
the purpose of facilitating the joint or common use of Property in or
adjacent to a shopping center or similar project affecting Property
which in the aggregate do not materially burden or impair the fair
market value or use of such Property for the purposes for which it is
or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental
Agency with respect to, the use of any Property;
(g) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental
Agency with respect to, any right, power, franchise, grant, license,
or permit;
(h) present or future zoning laws and ordinances or other laws
and ordinances restricting the occupancy, use, or enjoyment of
Property;
(i) statutory Liens, other than those described in clauses (a)
or (b) above, arising in the ordinary course of business with respect
to obligations which are not delinquent or are being contested in good
faith, PROVIDED that, if
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delinquent, adequate reserves have been set aside with respect thereto
and, by reason of nonpayment, no Property is subject to a material
impending risk of loss or forfeiture;
(j) covenants, conditions, and restrictions affecting the use of
Property which in the aggregate do not materially impair the fair
market value or use of the Property for the purposes for which it is
or may reasonably be expected to be held;
(k) rights of tenants under leases and rental agreements
covering Property entered into in the ordinary course of business of
the Person owning such Property; PROVIDED that if such Property is
covered by the Deed of Trust, such lease or rental agreement is junior
and subordinate to the Deed of Trust by operation of law or contract;
(l) Liens consisting of pledges or deposits to secure
obligations under workers' compensation laws or similar legislation,
including Liens of judgments thereunder which are not currently
dischargeable;
(m) Liens consisting of pledges or deposits of Property to
secure performance in connection with operating leases made in the
ordinary course of business, PROVIDED the aggregate value of all such
pledges and deposits in connection with any such lease does not at any
time exceed 20% of the annual fixed rentals payable under such lease;
(n) Liens consisting of deposits of Property to secure bids made
with respect to, or performance of, contracts (OTHER THAN contracts
creating or evidencing an extension of credit to the depositor);
(o) Liens consisting of any right of offset, or statutory
bankers' lien, on bank deposit accounts maintained in the ordinary
course of business so long as such bank deposit accounts are not
established or maintained for the purpose of providing such right of
offset or bankers' lien;
(p) Liens consisting of deposits of Property to secure statutory
obligations of Borrower or a Subsidiary of Borrower;
(q) Liens consisting of deposits of Property to secure (or in
lieu of) surety, appeal or customs bonds;
(r) Liens created by or resulting from any litigation or legal
proceeding in the ordinary course of its business which is currently
being contested in good faith by appropriate proceedings, PROVIDED
that such Lien is junior to the Lien of the Collateral Documents,
adequate reserves have been set aside and no material Property is
subject to a material impending risk of loss or forfeiture; and
-23-
(s) other non-consensual Liens incurred in the ordinary course
of business but not in connection with the incurrence of any
Indebtedness, which do not in the aggregate, when taken together with
all other Liens, materially impair the fair market value or use of the
Property for the purposes for which it is or may reasonably be
expected to be held.
"PERMITTED REFI DATE" means the date that is fifteen (15) months after
the Closing Date.
"PERMITTED RIGHT OF OTHERS" means a Right of Others consisting of
(a) an interest (other than a legal or equitable co-ownership interest, an
option or right to acquire a legal or equitable co-ownership interest and
any interest of a ground lessor under a ground lease), that does not
materially impair the fair market value or use of Property for the purposes
for which it is or may reasonably be expected to be held, (b) an option or
right to acquire a Lien that would be a Permitted Encumbrance, (c) the
subordination of a lease or sublease in favor of a financing entity and
(d) a license, or similar right, of or to Intangible Assets granted in the
ordinary course of business.
"PERSON" means any individual or entity, INCLUDING a trustee,
corporation, limited liability company, general partnership, limited
partnership, limited liability partnership, joint stock company, trust,
estate, unincorporated organization, business association, firm, joint
venture, Governmental Agency, or other entity.
"PLEDGE AGREEMENT" means the pledge agreement to be executed and
delivered by Parent in the form of EXHIBIT L, either as originally executed
or as it may from time to time be supplemented, modified, amended, extended
or supplanted.
"PLEDGED COLLATERAL" means the certificates evidencing 100% of the
capital stock of Borrower.
"PRE-OPENING EXPENSES" means, with respect to any fiscal period, the
amount of expenses (OTHER THAN Interest Expense) classified as "pre-opening
expenses" on the applicable financial statements of Borrower for such
period, prepared in accordance with Generally Accepted Accounting
Principles consistently applied.
"PROJECT" means the hotel/casino known as the "Sunset Station Hotel
and Casino" to be constructed on the Project Property, consisting generally
of an approximately 500 room hotel and an approximately 80,000 square foot
casino.
"PROJECT PROPERTY" means the real property located in Henderson,
Nevada on which the Project is to be constructed, comprised of
approximately (i) 51.4 acres of fee simple real property owned by Borrower
and (ii) 47.6 acres of an adjacent leasehold estate in real property leased
by Borrower under the Realty Lease, and all
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existing and future improvements thereto and all related appurtenances.
"PROJECTIONS" means the financial projections contained in the
Confidential Memorandum distributed by or on behalf of Borrower to the
Lenders on or about July 3, 1996.
"PROPERTY" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"PRO RATA SHARE" means, with respect to each Lender, the percentage of
the Commitment set forth opposite the name of that Lender on SCHEDULE 1.1,
as such percentage may be increased or decreased pursuant to a Commitment
Assignment and Acceptance executed in accordance with Section 12.8.
"QUALIFIED CAPITAL SOURCE" means (a) Cash Equity Contributions that
are designated to fund a specific Capital Expenditure and that are not
included in an Effected Cure and (b) Net Cash Proceeds from Dispositions
permitted by Section 6.2(A) up to $6,000,000 in the aggregate.
"QUARTERLY PAYMENT DATE" means each September 30, December 31,
March 31 and June 30.
"REAL PROPERTY" means, as of any date of determination, all real
Property then or theretofore owned, leased or occupied by Borrower or any
of its Subsidiaries.
"REALTY LEASE" means that certain Ground Lease dated as of June 17,
1994 between Navillus Investment Co. and certain associated Persons, as
lessors, and Parent, as lessee, covering the portion of the Project
Property described in clause (b) of the definition of such term, as
assigned to and assumed by Borrower pursuant to that certain Assignment and
Assumption dated as of July 30, 1996.
"REFERENCE RATE" means the rate of interest publicly announced from
time to time by Bank of America, N.T. & S.A. in San Francisco, California
as its "reference rate." It is a rate set by Bank of America, N.T. & S.A.
based upon various factors including its costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced
rate. Any change in the Reference Rate announced by Bank of America,
N.T. & S.A. shall take effect at the opening of business on the day
specified in the public announcement of such change.
"REGULATION D" means Regulation D, as at any time amended, of the
Board of Governors of the Federal Reserve System, or any other regulation
in substance substituted therefor.
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"REGULATIONS G, T, U AND X" means Regulations G, T, U and X, as at any
time amended, of the Board of Governors of the Federal Reserve System, or
any other regulations in substance substituted therefor.
"REQUEST FOR LOAN" means a written request for a Loan substantially in
the form of EXHIBIT M, signed by a Responsible Official of Borrower, on
behalf of Borrower, and properly completed to provide all information
required to be included therein.
"REQUIREMENT OF LAW" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any Law, or judgment, award,
decree, writ or determination of a Governmental Agency, in each case
applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"REQUISITE LENDERS" means (a) as of any date of determination if the
Commitment is then in effect, Lenders having in the aggregate 66-2/3% or
more of the Commitment then in effect and (b) as of any date of
determination if the Commitment has then been terminated and there is then
any Indebtedness evidenced by the Notes, Lenders holding Notes evidencing
in the aggregate 66-2/3% or more of the aggregate Indebtedness then
evidenced by the Notes.
"RESPONSIBLE OFFICIAL" means (a) when used with reference to a Person
other than an individual, any officer or manager of such Person, general
partner of such Person, officer of a corporate or limited liability company
general partner of such Person, officer of a corporate or limited liability
company general partner of a partnership that is a general partner of such
Person, or any other responsible official thereof duly acting on behalf
thereof, and (b) when used with reference to a Person who is an individual,
such Person. The Lenders shall be entitled to conclusively rely upon any
document or certificate that is signed or executed by a Responsible
Official of Borrower or any of its Subsidiaries (or, in the case of the
Completion Guaranty, of Parent) as having been authorized by all necessary
corporate, limited liability company, partnership and/or other action on
the part of Borrower or such Subsidiary (or, in the case of the Completion
Guaranty, of Parent); provided that such Responsible Official has been
designated as a Responsible Official for purposes of this Agreement (or, in
the case of Parent, the Completion Guaranty) in a written notice signed by
a Senior Officer and delivered to the Managing Agent, which notice has not
been cancelled or superseded.
"RIGHT OF OTHERS" means, as to any Property in which a Person has an
interest, any legal or equitable right, title or interest (other than a
Lien) held by any other Person in that Property, and any option or right
held by any other Person to acquire any such right, title or interest in
that Property, INCLUDING any option or right to acquire a Lien; PROVIDED,
however, that (a) any covenant restricting the use or disposition of
Property of such Person contained in any Contractual Obligation of such
Person and (b) any
-26-
provision contained in a contract creating a right of payment or
performance in favor of a Person that conditions, limits, restricts,
diminishes, transfers or terminates such right, shall not be deemed to
constitute a Right of Others.
"SECURED SWAP AGREEMENT" means a Swap Agreement between Borrower and a
Lender (or an Affiliate of a Lender) that is secured by a Lien on the
Collateral that complies with the applicable provisions of Section 11.3.
"SECURITY AGREEMENT" means the security agreement to be executed and
delivered by Borrower and each of its Subsidiaries, in the form of
EXHIBIT N, either as originally executed or as it may from time to time be
supplemented, modified, amended, extended or supplanted.
"SENIOR FUNDED DEBT" means, as of any date of determination (without
duplication), the SUM OF (a) all principal Indebtedness of Borrower and its
Subsidiaries for borrowed money (INCLUDING debt securities issued by
Borrower), on that date PLUS (b) the aggregate amount of the principal
portion of all Capital Lease Obligations of Borrower and its Subsidiaries
on that date, EXCLUDING any of the foregoing that is subordinated by its
terms in right of payment to the payment of other Indebtedness of Borrower
and its Subsidiaries.
"SENIOR FUNDED DEBT RATIO" means, as of the last day of each Fiscal
Quarter ending after the Completion Date, the RATIO OF (a) Senior Funded
Debt as of that date TO (b) Adjusted Annualized EBITDA as of that date.
"SENIOR OFFICER" means the (a) chief executive officer, (b) president,
(c) executive vice president, (d) senior vice president, (e) chief
financial officer or (f) treasurer of Borrower.
"SPECIAL EURODOLLAR CIRCUMSTANCE" means the application or adoption
after the Closing Date of any Law or interpretation, or any change therein
or thereof, or any change in the interpretation or administration thereof
by any Governmental Agency, central bank or comparable authority charged
with the interpretation or administration thereof, or compliance by any
Lender or its Eurodollar Lending Office with any request or directive
(whether or not having the force of Law) of any such Governmental Agency,
central bank or comparable authority.
"STOCKHOLDERS' EQUITY" means, as of any date of determination and with
respect to any Person, the consolidated stockholders' equity of the Person
as of that date determined in accordance with Generally Accepted Accounting
Principles; PROVIDED that there shall be excluded from Stockholders' Equity
any amount attributable to Disqualified Stock.
"SUBORDINATED OBLIGATIONS" means (a) any Supplemental Loans, (b) any
obligation of Borrower or any of its Subsidiaries to pay any
-27-
Management Fee to Parent or any Affiliate of Parent, (c) any other
obligation of Borrower or any of its Subsidiaries to Parent (OTHER THAN the
Equipment Sublease) or any Affiliate of Parent and (d) any obligation of
Borrower or any of its Subsidiaries to any other Person that is
subordinated by its terms in right of payment to the Obligations or to all
Indebtedness of Borrower or its Subsidiary.
"SUBSIDIARY" means, as of any date of determination and with respect
to any Person, any corporation, limited liability company or partnership
(whether or not, in either case, characterized as such or as a "joint
venture"), whether now existing or hereafter organized or acquired: (a) in
the case of a corporation or limited liability company, of which a majority
of the securities having ordinary voting power for the election of
directors or other governing body (other than securities having such power
only by reason of the happening of a contingency) are at the time
beneficially owned by such Person and/or one or more Subsidiaries of such
Person, or (b) in the case of a partnership, of which a majority of the
partnership or other ownership interests are at the time beneficially owned
by such Person and/or one or more of its Subsidiaries.
"SUBSIDIARY GUARANTY" means the continuing guaranty of the Obligations
to be executed and delivered by each Subsidiary of Borrower, in the form of
EXHIBIT O, either as originally executed or as it may from time to time be
supplemented, modified, amended, extended or supplanted.
"SUPERMAJORITY LENDERS" means (a) as of any date of determination if
the Commitment is then in effect, Lenders having in the aggregate 85% or
more of the Commitment then in effect and (b) as of any date of
determination if the Commitment has then been terminated and there is then
any Indebtedness evidenced by the Notes, Lenders holding Notes evidencing
in the aggregate 85% or more of the aggregate Indebtedness then evidenced
by the Notes.
"SUPPLEMENTAL CREDIT FACILITY" means the $25,000,000 credit facility
extended by Parent to Borrower pursuant to the Supplemental Loan Agreement.
"SUPPLEMENTAL LOANS" means the subordinated loans advanced by Parent
to Borrower pursuant to the Supplemental Credit Facility.
"SUPPLEMENTAL LOAN AGREEMENT" means the Loan Agreement dated as of
September 20, 1996 between Parent and Borrower.
"SWAP AGREEMENT" means a written agreement between Borrower and one or
more financial institutions providing for "swap", "cap", "collar" or other
interest rate protection with respect to any Indebtedness.
"TITLE COMPANY" means Nevada Title Company or such other title
insurance company as is reasonably acceptable to the Managing Agent.
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"TO THE BEST KNOWLEDGE OF" means, when modifying a representation,
warranty or other statement of any Person, that the fact or situation
described therein is known by the Person (or, in the case of a Person other
than a natural Person, known by a Responsible Official of that Person)
making the representation, warranty or other statement, or with the
exercise of reasonable due diligence under the circumstances (in accordance
with the standard of what a reasonable Person in similar circumstances
would have done) would have been known by the Person (or, in the case of a
Person other than a natural Person, would have been known by a Responsible
Official of that Person).
"TOTAL INCURRED PROJECT COST" means, as of any date of determination,
the total cost of the Project (INCLUDING the cost of all Property
contributed by Parent, the cost of the Leased Equipment, financing costs
and Pre-Opening Expenses) incurred or accrued as of that date based on
customary methods used by CSG for estimating percentage completion of
construction projects; PROVIDED, however, that so long as there is no Event
of Default (as such term is defined in the Equipment Lease) under the
Equipment Lease, the maximum cost of the Leased Equipment pursuant to the
Equipment Lease shall be assumed to have been incurred as of such date.
"TYPE", when used with respect to any Loan or Advance, means the
designation of whether such Loan or Advance is an Alternate Base Rate Loan
or Advance, or a Eurodollar Rate Loan or Advance.
1.2 USE OF DEFINED TERMS. Any defined term used in the plural shall
refer to all members of the relevant class, and any defined term used in the
singular shall refer to any one or more of the members of the relevant class.
1.3 ACCOUNTING TERMS. All accounting terms not specifically defined
in this Agreement shall be construed in conformity with, and all financial data
required to be submitted by this Agreement shall be prepared in conformity with,
Generally Accepted Accounting Principles applied on a consistent basis, EXCEPT
as otherwise specifically prescribed herein. In the event that Generally
Accepted Accounting Principles change during the term of this Agreement such
that the covenants contained in Sections 6.11 through 6.13 would then be
calculated in a different manner or with different components, (a) Borrower and
the Lenders agree to amend this Agreement in such respects as are necessary to
conform those covenants as criteria for evaluating Borrower's financial
condition to substantially the same criteria as were effective prior to such
change in Generally Accepted Accounting Principles and (b) until such changes
are so agreed upon Borrower shall be deemed to be in compliance with the
covenants contained in the aforesaid Sections if and to the extent that Borrower
would have been in compliance therewith under Generally Accepted Accounting
Principles as in effect immediately prior to such change, and shall have the
obligation to deliver a reconciliation with respect to each of the materials
described in ARTICLE 8 to the Managing Agent and the Lenders, on the dates
therein specified, reflecting the differences between financial data presented
in a manner which conforms with Generally Accepted Accounting Principles as in
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effect immediately prior to such change and the financial data presented in
accordance with the new Generally Accepted Accounting Principles taking into
account such change.
1.4 ROUNDING. Any financial ratios required to be maintained by
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed in this
Agreement and rounding the result up or down to the nearest number (with a
round-up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.5 EXHIBITS AND SCHEDULES. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time be
supplemented, modified or amended, are incorporated herein by this reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.6 REFERENCES TO "BORROWER AND ITS SUBSIDIARIES". Any reference
herein to "Borrower and its Subsidiaries" or the like shall refer solely to
Borrower during such times, if any, as Borrower shall have no Subsidiaries.
1.7 MISCELLANEOUS TERMS. The term "or" is disjunctive; the term
"and" is conjunctive. The term "shall" is mandatory; the term "may" is
permissive. Masculine terms also apply to females; feminine terms also apply to
males. The term "including" is by way of example and not limitation.
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Article 2
LOANS
2.1 LOANS-GENERAL.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Closing Date through
the Availability Termination Date, each Lender shall, pro rata according to
that Lender's Pro Rata Share of the then applicable Commitment, make
Advances to Borrower under the Commitment in such amounts as Borrower may
request that do not result in the aggregate principal amount outstanding
under the Notes exceeding the then applicable Commitment. Borrower may
borrow, but may not repay and reborrow under the Commitment.
(b) Subject to the next sentence, each Loan shall be made
pursuant to a Request for Loan which shall specify the requested (i) date
of such Loan and (ii) amount of such Loan and which shall be received by
the Managing Agent, at the Managing Agent's Office, not later than
9:00 a.m. California time on the date (which must be a Banking Day) of the
requested Loan. Unless the Managing Agent has notified, in its sole and
absolute discretion, Borrower to the contrary, a Loan may be requested by
telephone by a Responsible Official of Borrower, in which case Borrower
shall confirm such request by promptly delivering a Request for Loan in
person or by telecopier conforming to the preceding sentence to the
Managing Agent. Managing Agent shall incur no liability whatsoever
hereunder in acting upon any telephonic request for Loan purportedly made
by a Responsible Official of Borrower, and Borrower hereby agrees to
indemnify the Managing Agent from any loss, cost, expense or liability as a
result of so acting.
(c) Promptly following receipt of a Request for Loan, the
Managing Agent shall notify each Lender by telephone or telecopier (and if
by telephone, promptly confirmed by telecopier) of the date and amount of
the Loan, and that Lender's Pro Rata Share of the Loan. Not later than
11:00 a.m., California time, on the date specified for the Loan (which must
be a Banking Day), each Lender shall make its Pro Rata Share of the Loan in
immediately available funds available to the Managing Agent at the Managing
Agent's Office. Upon satisfaction or waiver of the applicable conditions
set forth in ARTICLE 9, all Advances shall be credited on that date in
immediately available funds to the Designated Deposit Account.
(d) Unless the Requisite Lenders otherwise consent, (i) each
Loan shall be not less than $7,500,000 (EXCEPT when such Loan is for the
unused balance of the Commitment) and (ii) no more than two (2) Loans may
be requested in any calendar month, EXCEPT, in each case, for a Loan made
to satisfy Borrower's obligations under Section 2.4.
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(e) The Advances made by each Lender shall be evidenced by that
Lender's Note.
(f) A Request for Loan shall be irrevocable upon the Managing
Agent's first notification thereof.
2.2 AUTOMATIC REDUCTION OF COMMITMENT. On the Availability
Termination Date, the Commitment shall automatically be reduced to an amount
equal to the aggregate principal Indebtedness evidenced by the Notes.
2.3 VOLUNTARY REDUCTION OF COMMITMENT. Borrower shall have the
right, at any time and from time to time, without penalty or charge, upon at
least three (3) Banking Days' prior written notice by a Responsible Official of
Borrower to the Managing Agent, voluntarily to reduce, permanently and
irrevocably, in aggregate principal amounts in an integral multiple of
$1,000,000 but not less than $5,000,000, or to terminate, all or a portion of
the then undisbursed portion of the Commitment. The Managing Agent shall
promptly notify the Lenders of any reduction or termination of the Commitment
under this Section.
2.4 MANAGING AGENT'S RIGHT TO ASSUME FUNDS AVAILABLE FOR ADVANCES.
Unless the Managing Agent shall have been notified by any Lender no later than
10:00 a.m. on the Banking Day of the proposed funding by the Managing Agent of
any Loan that such Lender does not intend to make available to the Managing
Agent such Lender's portion of the total amount of such Loan, the Managing Agent
may assume that such Lender has made such amount available to the Managing Agent
on the date of the Loan and the Managing Agent may, in reliance upon such
assumption, make available to Borrower a corresponding amount. If the Managing
Agent has made funds available to Borrower based on such assumption and such
corresponding amount is not in fact made available to the Managing Agent by such
Lender, the Managing Agent shall be entitled to recover such corresponding
amount on demand from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Managing Agent's demand therefor, the
Managing Agent promptly shall notify Borrower and Borrower shall pay such
corresponding amount to the Managing Agent. The Managing Agent also shall be
entitled to recover from such Lender interest on such corresponding amount in
respect of each day from the date such corresponding amount was made available
by the Managing Agent to Borrower to the date such corresponding amount is
recovered by the Managing Agent, at a rate per annum equal to the daily Federal
Funds Rate. Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its share of the Commitment or to prejudice any rights
which the Managing Agent or Borrower may have against any Lender as a result of
any default by such Lender hereunder.
2.5 COLLATERAL AND GUARANTY. The Obligations shall be secured by the
Collateral pursuant to the Collateral Documents, be from time to time guaranteed
by the Subsidiaries of Borrower (if any) pursuant to the Subsidiary Guaranty and
enjoy the benefits of the Completion Guaranty.
2.6 LENDER'S ACKNOWLEDGEMENT. Each Lender hereby acknowledges that
it shall not have in respect of all or any part of the Obligations any
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recourse to the assets or stock of Parent or any Subsidiary of Parent (OTHER
THAN Borrower and its Subsidiaries), EXCEPT such recourse as arises pursuant to
the Completion Guaranty, the Pledge Agreement or the rights of Borrower under
any agreement or instrument included in the Collateral.
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Article 3
PAYMENTS AND FEES
3.1 PRINCIPAL AND INTEREST.
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance from the date thereof until payment in
full is made and shall accrue and be payable at the rates set forth or
provided for herein before and after Default, before and after maturity,
before and after judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law, with interest on overdue interest
at the Default Rate to the fullest extent permitted by applicable Laws.
(b) Each Loan shall be an Alternate Base Rate Loan from the date
when made to the next following Eurodollar Period Commencement Date, at
which time it shall automatically convert into a Eurodollar Rate Loan.
Interest accrued on all Alternate Base Rate Loans on each Quarterly Payment
Date shall be due and payable on that day. EXCEPT as otherwise provided in
Sections 3.1(d) and 3.10, the unpaid principal amount of any Alternate Base
Rate Loan shall bear interest at a fluctuating rate per annum equal to the
Alternate Base Rate PLUS the Alternate Base Rate Margin. Each change in
the interest rate under this Section 3.1(b) due to a change in the
Alternate Base Rate shall take effect simultaneously with the corresponding
change in the Alternate Base Rate. The Managing Agent shall notify the
Lenders in writing of the making of (or conversion into) each Alternate
Base Rate Loan and the Alternate Base Rate and Alternate Base Rate Margin
applicable thereto.
(c) The Eurodollar Rate Loan into which each Alternate Base Rate
Loan is converted pursuant to Section 3.1(b) shall automatically convert at
the end of its Eurodollar Period into another Eurodollar Rate Loan (subject
to any reduction in the amount thereof to reflect payment of an
Amortization Amount or the mandatory prepayment required pursuant to
Section 3.1(f)); PROVIDED that any Eurodollar Rate Loan expiring on or
after July 1, 2000 or after the date upon which Borrower has delivered the
written notice referred to in clause (b) of the definition of Eurodollar
Period for which Borrower has not designated a Eurodollar Period of one (1)
or two (2) months shall automatically convert at the end of its Eurodollar
Period into an Alternate Base Rate Loan; and PROVIDED FURTHER that upon
delivery by Borrower of written notice to the Managing Agent that Borrower
no longer holds the intention referred to in such clause (b), such
Alternate Base Rate Loan shall, at the option of Borrower, be converted
into a Eurodollar Rate Loan or Eurodollar Rate Loans of one, two and/or
three month Eurodollar Periods so as (and on such dates as) to permit the
outstanding Loans to be Eurodollar Rate Loans of such Eurodollar Periods
and commencing on such Eurodollar Period Commencement Dates as would have
existed if the initial conversions as a result of the delivery of the
written notice specified in such clause (b) had never been made. Interest
accrued
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on each Eurodollar Rate Loan shall be due and payable on the last day of
the related Eurodollar Period. EXCEPT as otherwise provided in
Sections 3.1(d) and 3.10, the unpaid principal amount of each Eurodollar
Rate Loan shall bear interest at a rate per annum equal to the Eurodollar
Rate for that Eurodollar Rate Loan PLUS 3 3/4% (375 basis points). The
Managing Agent shall notify the Lenders and Borrower in writing of the
conversion of each Loan into a Eurodollar Rate Loan, the date of such
conversion and the Eurodollar Rate applicable thereto, which notification
shall be delivered two (2) Eurodollar Banking Days prior to the date of
such conversion.
(d) The interest rate payable on all Loans pursuant to
Sections 3.1(b) or 3.1(c) shall be increased by 2% (200 basis points) per
annum as of the last day of any Fiscal Quarter if on such date Borrower was
not in compliance with Sections 6.11, 6.12 or 6.13 and shall continue at
such increased interest rate until the EARLIER OF (i) the date upon which
an Effected Cure is made or deemed made with respect to such Section or
Sections or (ii) the last day of the first following Fiscal Quarter as of
which Borrower is in compliance with all such Sections. Nothing in this
Section 3.1(d) shall imply a waiver of the Event of Default resulting from
any failure to comply with any of such Sections prior to the making of an
Effected Cure and the Lenders expressly reserve their rights to exercise
any of the remedies referred to in Section 10.2 during the existence of
such an Event of Default.
(e) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be payable as follows:
(i) the amount, if any, by which the outstanding principal Indebtedness
evidenced by the Notes at any time exceeds the then applicable Commitment, shall
be payable immediately;
(ii) each Amortization Amount shall be payable on the related Amortization Date;
and
(iii) the outstanding principal Indebtedness evidenced by the Notes shall in any
event be payable in full on the Maturity Date.
(f) The Notes shall be prepaid on the last day of the Eurodollar
Period ending nearest to July 31, 1998 (and on the last day of the
Eurodollar Period ending nearest to each subsequent July 31) by an amount
equal to the SUM OF (i) 75% of the first $4,000,000 of any Excess Cash Flow
for the Fiscal Year ended March 31, 1998 (or, as applicable, the Fiscal
Year then most recently ended) PLUS (ii) 25% of any Excess Cash Flow for
such Fiscal Year in excess of $4,000,000; PROVIDED that (i) any voluntary
prepayment made pursuant to Section 3.1(g) during the twelve month period
ending on such July 31 shall be credited against the prepayment required
under this Section 3.1(f) and (ii) the amount of any prepayment required
under this Section 3.1(f) shall be rounded to the nearest $100,000. Such
prepayments shall be applied, first, to the principal amount due on the
Maturity Date and thereafter to Amortization Amounts in reverse order of
maturity.
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(g) The Notes may, at any time after the Permitted Refi Date and
from time to time, voluntarily be prepaid in whole or in part without
premium or penalty, EXCEPT that with respect to any voluntary prepayment
under this Section (i) any partial prepayment shall be not less than
$1,750,000, (ii) the Managing Agent shall have received written notice of
any prepayment by 9:00 a.m. California time three (3) Banking Days before
the date of prepayment, which notice shall identify the date and amount of
the prepayment and the Loan(s) being prepaid, (iii) each prepayment of
principal on any Eurodollar Rate Loan shall be accompanied by payment of
interest accrued to the date of payment on the amount of principal paid and
(iv) any payment or prepayment of all or any part of any Eurodollar Rate
Loan on a day other than the last day of the applicable Interest Period
shall be subject to Section 3.9(e). Promptly following receipt of a notice
of prepayment under clause (ii) above, the Managing Agent shall notify each
Lender by telephone or telecopier (and if by telephone, promptly confirmed
by telecopier) of the date and amount thereof.
3.2 ARRANGEMENT FEE. On the Closing Date, Borrower shall pay to the
Arranger an arrangement fee in the amount heretofore agreed upon by letter
agreement between Borrower and the Arranger. Such arrangement fee is for the
services of the Arranger in arranging the credit facilities under this Agreement
and is fully earned when paid. The arrangement fee paid to the Arranger is
solely for its own account and is nonrefundable.
3.3 UPFRONT FEES. On the Closing Date, Borrower shall pay to the
Managing Agent, for the accounts of the Lenders, according to the level of their
respective Pro Rata Share of the Commitment, upfront fees equal to the number of
basis points set forth below opposite the level of the Pro Rata Share of the
Commitment held by such Lender:
Pro Rata Share of
Commitment Basis Points
----------------- ------------
$25,000,000 or greater 150
$15,000,000 to $24,999,999 125
$10,000,000 to $14,999,999 100
Less than $10,000,000 75
Such upfront fees are for the credit facilities committed by each Lender under
this Agreement and are fully earned when paid. The upfront fees paid to each
Lender are solely for its own account and are nonrefundable.
3.4 COMMITMENT FEES. From the Closing Date through the Availability
Termination Date, Borrower shall pay to the Managing Agent, for the accounts of
the Lenders pro rata according to their Pro Rata Share of the Commitment, a
commitment fee equal to 3/8 of 1% (37.5 basis points) per annum TIMES the
average daily amount by which the Commitment exceeds the aggregate principal
amount outstanding under the Notes. The commitment
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fee shall be payable quarterly in arrears on each Quarterly Payment Date and on
the Availability Termination Date.
3.5 PREPAYMENT FEE. If, prior to the Permitted Refi Date, Borrower
makes any prepayment of any Loan (OTHER THAN a mandatory prepayment under
Section 3.1(f), a prepayment resulting from the application of casualty
insurance or eminent domain proceeds pursuant to any of the Collateral Documents
or a prepayment pursuant to Section 6.2(a)(iv)), concurrently with such
prepayment Borrower shall pay to the Managing Agent, for the ratable accounts of
the Lenders pro rata according to their Pro Rata Share of the Commitment, a
prepayment fee equal to 1% (100 basis points) of the amount so prepaid.
3.6 MANAGING AGENT FEES. Borrower shall pay to the Managing Agent an
agency fee in such amounts and at such times as heretofore agreed upon by letter
agreement between Borrower and the Managing Agent. The agency fee is for the
services to be performed by the Managing Agent in acting as Managing Agent and
is fully earned on the date paid. The agency fee paid to the Managing Agent is
solely for its own account and is nonrefundable.
3.7 CO-AGENT FEES. Borrower shall pay to each of the Co-Agents a co-
agency fee in such amount and at such times as heretofore agreed upon by letter
agreement between Borrower, the Managing Agent and each of the Co-Agents. The
co-agency fee is for the services performed by each of the Co-Agents in acting
as a Co-Agent and is fully earned on the date paid. The co-agency fee paid to
each of the Co-Agents is solely for its own account and is non-refundable.
3.8 INCREASED COMMITMENT COSTS. If any Lender shall determine in
good faith that the introduction after the Closing Date of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change therein
or any change in the interpretation or administration thereof by any central
bank or other Governmental Agency charged with the interpretation or
administration thereof, or compliance by such Lender (or its Eurodollar Lending
Office) or any corporation controlling the Lender, with any request, guideline
or directive regarding capital adequacy (whether or not having the force of Law)
of any such central bank or other authority not imposed as a result of such
Lender's or such corporation's failure to comply with any other Laws, affects or
would affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy
and such Lender's desired return on capital) determines in good faith that the
amount of such capital is increased, or the rate of return on capital is
reduced, as a consequence of its obligations under this Agreement, then, within
ten (10) Banking Days after demand of such Lender, Borrower shall pay to such
Lender, from time to time as specified in good faith by such Lender, additional
amounts sufficient to compensate such Lender in light of such circumstances, to
the extent reasonably allocable to such obligations under this Agreement,
PROVIDED that Borrower shall not be obligated to pay any such amount which arose
prior to the date which is ninety (90) days preceding the date of such demand or
is attributable to periods prior to
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the date which is ninety (90) days preceding the date of such demand. Each
Lender's determination of such amounts shall be conclusive in the absence of
manifest error.
3.9 EURODOLLAR COSTS AND RELATED MATTERS.
(a) In the event that any Governmental Agency imposes on any
Lender any reserve or comparable requirement (INCLUDING any emergency,
supplemental or other reserve) with respect to the Eurodollar Obligations
of that Lender, Borrower shall pay that Lender within five (5) Banking Days
after demand all amounts necessary to compensate such Lender (determined as
though such Lender's Eurodollar Lending Office had funded 100% of its
Eurodollar Rate Advance in the Designated Eurodollar Market) in respect of
the imposition of such reserve requirements (PROVIDED, that Borrower shall
not be obligated to pay any such amount which arose prior to the date which
is ninety (90) days preceding the date of such demand or is attributable to
periods prior to the date which is ninety (90) days preceding the date of
such demand). The Lender's determination of such amount shall be
conclusive in the absence of manifest error.
(b) If, after the date hereof, the existence or occurrence of
any Special Eurodollar Circumstance:
(1) shall subject any Lender or its Eurodollar Lending Office to
any tax, duty or other charge or cost with respect to any Eurodollar
Rate Advance, its Note evidencing Eurodollar Rate Advances or its
obligation to make Eurodollar Rate Advances, or shall change the basis
of taxation of payments to any Lender attributable to the principal of
or interest on any Eurodollar Rate Advance or any other amounts due
under this Agreement in respect of any Eurodollar Rate Advance, its
Note evidencing Eurodollar Rate Advances or its obligation to make
Eurodollar Rate Advances (PROVIDED, that Borrower shall not be
obligated to pay any such amount which arose prior to the date which
is ninety (90) days preceding the date of such demand or is
attributable to periods prior to the date which is ninety (90) days
preceding the date of such demand), EXCLUDING (i) taxes imposed on or
measured in whole or in part by its overall net income by (A) any
jurisdiction (or political subdivision thereof) in which it is
organized or maintains its principal office or Eurodollar Lending
Office or (B) any jurisdiction (or political subdivision thereof) in
which it is "doing business" and (ii) any withholding taxes or other
taxes based on gross income imposed by the United States of America
for any period with respect to which it has failed to provide Borrower
with the appropriate form or forms required by Section 12.21, to the
extent such forms are then available under applicable Laws;
(2) shall impose, modify or deem applicable any reserve not
applicable or deemed applicable on the date hereof (INCLUDING any
reserve imposed by the Board of Governors of the
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Federal Reserve System, special deposit, capital or similar
requirements against assets of, deposits with or for the account of,
or credit extended by, any Lender or its Eurodollar Lending Office);
or
(3) shall impose on any Lender or its Eurodollar Lending Office
or the Designated Eurodollar Market any other condition affecting any
Eurodollar Rate Advance, its Note evidencing Eurodollar Rate Advances,
its obligation to make Eurodollar Rate Advances or this Agreement, or
shall otherwise affect any of the same;
and the result of any of the foregoing, as determined in good faith by such
Lender, increases the cost to such Lender or its Eurodollar Lending Office
of making or maintaining any Eurodollar Rate Advance or in respect of any
Eurodollar Rate Advance, its Note evidencing Eurodollar Rate Advances or
its obligation to make Eurodollar Rate Advances or reduces the amount of
any sum received or receivable by such Lender or its Eurodollar Lending
Office with respect to any Eurodollar Rate Advance, its Note evidencing
Eurodollar Rate Advances or its obligation to make Eurodollar Rate Advances
(assuming such Lender's Eurodollar Lending Office had funded 100% of its
Eurodollar Rate Advance in the Designated Eurodollar Market), then, within
five (5) Banking Days after demand by such Lender (with a copy to the
Managing Agent), Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender for such increased cost or
reduction (determined as though such Lender's Eurodollar Lending Office had
funded 100% of its Eurodollar Rate Advance in the Designated Eurodollar
Market). A statement of any Lender claiming compensation under this
subsection shall be conclusive in the absence of manifest error.
(c) If, after the date hereof, the existence or occurrence of
any Special Eurodollar Circumstance shall, in the good faith opinion of any
Lender, make it unlawful or impossible for such Lender or its Eurodollar
Lending Office to make, maintain or fund its portion of any Eurodollar Rate
Loan, or materially restrict the authority of such Lender to purchase or
sell, or to take deposits of, Dollars in the Designated Eurodollar Market,
or to determine or charge interest rates based upon the Eurodollar Rate,
and such Lender shall so notify the Managing Agent, then such Lender's
obligation to make Eurodollar Rate Advances shall be suspended for the
duration of such illegality or impossibility and the Managing Agent
forthwith shall give notice thereof to the other Lenders and Borrower.
Upon receipt of such notice, the outstanding principal amount of such
Lender's Eurodollar Rate Advances, together with accrued interest thereon,
automatically shall be converted to Alternate Base Rate Advances on either
(1) the last day of the Eurodollar Period(s) applicable to such Eurodollar
Rate Advances if such Lender may lawfully continue to maintain and fund
such Eurodollar Rate Advances to such day(s) or (2) immediately if such
Lender may not lawfully continue to fund and maintain such Eurodollar Rate
Advances to such day(s), PROVIDED that in such event the conversion shall
not be
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subject to payment of a prepayment fee under clause (e) of this Section.
Each Lender agrees to endeavor promptly to notify Borrower of any event of
which it has actual knowledge, occurring after the Closing Date, which will
cause that Lender to notify the Managing Agent under this Section, and
agrees to designate a different Eurodollar Lending Office if such
designation will avoid the need for such notice and will not, in the good
faith judgment of such Lender, otherwise be materially disadvantageous to
such Lender. In the event that any Lender is unable, for the reasons set
forth above, to make, maintain or fund its portion of any Eurodollar Rate
Loan, such Lender shall fund such amount as an Alternate Base Rate Advance
for the same period of time, and such amount shall be treated in all
respects as an Alternate Base Rate Advance. Any Lender whose obligation to
make Eurodollar Rate Advances has been suspended under this Section shall
promptly notify the Managing Agent and Borrower of the cessation of the
Special Eurodollar Circumstance which gave rise to such suspension.
(d) If, with respect to any proposed Eurodollar Rate Loan:
(1) the Managing Agent reasonably determines that, by reason of
circumstances affecting the Designated Eurodollar Market generally
that are beyond the reasonable control of the Lenders, deposits in
Dollars (in the applicable amounts) are not being offered to any
Lender in the Designated Eurodollar Market for the applicable
Eurodollar Period; or
(2) the Requisite Lenders advise the Managing Agent that the
Eurodollar Rate as determined by the Managing Agent (i) does not
represent the effective pricing to such Lenders for deposits in
Dollars in the Designated Eurodollar Market in the relevant amount for
the applicable Eurodollar Period, or (ii) will not adequately and
fairly reflect the cost to such Lenders of making the applicable
Eurodollar Rate Advances;
then the Managing Agent forthwith shall give notice thereof to Borrower and
the Lenders, whereupon until the Managing Agent notifies Borrower that the
circumstances giving rise to such suspension no longer exist, the
obligation of the Lenders to make any future Eurodollar Rate Advances shall
be suspended. Upon delivery by the Managing Agent to Borrower of notice
that the circumstances giving rise to such suspension no longer exist, any
Alternate Base Rate Loan into which a Eurodollar Rate Loan may have been
converted as a result of any such suspension shall be converted into a
Eurodollar Rate Loan or Eurodollar Rate Loans of one, two and/or three
month Eurodollar Periods so as (and on such dates as) to permit the
outstanding Loans to be Eurodollar Rate Loans of such Eurodollar Periods
and commencing on such Eurodollar Period Commencement Dates as would have
existed if such conversions had not occurred.
(e) Upon prepayment of any Eurodollar Rate Advance (OTHER THAN
as the result of a conversion required under clause (c)
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of this Section) on a day other than the last day in the applicable
Eurodollar Period (whether voluntarily, involuntarily, by reason of
acceleration, or otherwise), or upon the failure of Borrower to prepay a
Eurodollar Rate Loan on the date specified in a notice of prepayment
delivered to the Managing Agent pursuant to Section 3.1(g), Borrower shall
pay to the appropriate Lender within ten (10) Banking Days after demand a
prepayment fee or failure to prepay fee, as the case may be (determined as
though 100% of the Eurodollar Rate Advance had been funded in the
Designated Eurodollar Market), equal to the SUM OF:
(1) the principal amount of the Eurodollar Rate Advance prepaid
or not prepaid, as the case may be, TIMES the number of days from and
including the date of prepayment or failure to prepay, as applicable,
to but excluding the last day in the applicable Eurodollar Period,
DIVIDED BY 360, TIMES the applicable Interest Differential (PROVIDED
that the product of the foregoing formula must be a positive number);
PLUS
(2) all out-of-pocket expenses incurred by the Lender reasonably
attributable to such prepayment or failure to prepay.
Each Lender's determination of the amount of any prepayment fee or failure
to prepay fee payable under this Section shall be conclusive in the absence
of manifest error.
(f) Each Lender agrees to endeavor promptly to notify Borrower
of any event of which it has actual knowledge, occurring after the Closing
Date, which will entitle such Lender to compensation pursuant to clause (a)
or clause (b) of this Section, and agrees to designate a different
Eurodollar Lending Office if such designation will avoid the need for or
reduce the amount of such compensation and will not, in the good faith
judgment of such Lender, otherwise be materially disadvantageous to such
Lender. Any request for compensation by a Lender under this Section shall
set forth the basis upon which it has been determined that such an amount
is due from Borrower, a calculation of the amount due, and a certification
that the corresponding costs have been incurred by the Lender.
3.10 LATE PAYMENTS. If any installment of principal or interest or
any fee or cost or other amount payable under any Loan Document to the Managing
Agent or any Lender is not paid when due, it shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the SUM OF the average
interest rate otherwise payable on all Loans then outstanding hereunder PLUS 2%,
to the fullest extent permitted by applicable Laws. Accrued and unpaid interest
on past due amounts (INCLUDING interest on past due interest) shall be
compounded monthly, on the last day of each calendar month, to the fullest
extent permitted by applicable Laws.
3.11 COMPUTATION OF INTEREST AND FEES. Computation of interest and
fees under this Agreement shall be calculated on the basis of
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a year of 360 days and the actual number of days elapsed. Interest shall accrue
on each Loan for the day on which the Loan is made; interest shall not accrue on
a Loan, or any portion thereof, for the day on which the Loan or such portion is
paid. Any Loan that is repaid on the same day on which it is made shall bear
interest for one day. Notwithstanding anything in this Agreement to the
contrary, interest in excess of the maximum amount permitted by applicable Laws
shall not accrue or be payable hereunder or under the Notes, and any amount paid
as interest hereunder or under the Notes which would otherwise be in excess of
such maximum permitted amount shall instead be treated as a payment of
principal.
3.12 NON-BANKING DAYS. If any payment to be made by Borrower or any
other Party under any Loan Document shall come due on a day other than a Banking
Day, payment shall instead be considered due on the next succeeding Banking Day
and the extension of time shall be reflected in computing interest and fees.
3.13 MANNER AND TREATMENT OF PAYMENTS.
(a) Each payment hereunder (EXCEPT payments pursuant to
Sections 3.8, 3.9, 12.3, 12.11 and 12.22) or on the Notes or under any
other Loan Document shall be made to the Managing Agent, at the Managing
Agent's Office, for the account of each of the Lenders or the Managing
Agent, as the case may be, in immediately available funds not later than
11:00 a.m. California time, on the day such payment is due. All payments
received after such time, on any Banking Day, shall be deemed received on
the next succeeding Banking Day. The amount of all payments received by
the Managing Agent for the account of each Lender shall be immediately paid
by the Managing Agent to the applicable Lender in immediately available
funds and, if such payment was received by the Managing Agent by
11:00 a.m., California time, on a Banking Day and not so made available to
the account of a Lender on that Banking Day, the Managing Agent shall
reimburse that Lender for the cost to such Lender of funding the amount of
such payment at the Federal Funds Rate. All payments shall be made in
lawful money of the United States of America.
(b) Each payment or prepayment on account of any Loan shall be
applied pro rata according to the outstanding Advances made by each Lender
comprising such Loan.
(c) Each Lender shall use its best efforts to keep a record
(which may be in tangible or electronic or other intangible form) of
Advances made by it and payments received by it with respect to its Note
and, subject to Section 11.6(g), such record shall, as against Borrower, be
presumptive evidence of the amounts owing. Notwithstanding the foregoing
sentence, the failure by any Lender to keep such a record shall not affect
Borrower's obligation to pay the Obligations.
(d) Each payment of any amount payable by Borrower or any other
Party under this Agreement or any other Loan Document shall be made free
and clear of, and without reduction by reason of, any
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taxes, assessments or other charges imposed by any Governmental Agency,
central bank or comparable authority, EXCLUDING (i) taxes imposed on or
measured in whole or in part by its overall net income, by (A) any
jurisdiction (or political subdivision thereof) in which it is organized or
maintains its principal office or Eurodollar Lending Office or (B) any
jurisdiction (or political subdivision thereof) in which it is "doing
business" and (ii) any withholding taxes or other taxes based on gross
income imposed by the United States of America for any period with respect
to which it has failed to provide Borrower with the appropriate form or
forms required by Section 12.21, to the extent such forms are then
available under applicable Laws (all such non-excluded taxes, assessments
or other charges being hereinafter referred to as "Taxes"). To the extent
that Borrower is obligated by applicable Laws to make any deduction or
withholding on account of Taxes from any amount payable to any Lender under
this Agreement, Borrower shall (i) make such deduction or withholding and
pay the same to the relevant Governmental Agency and (ii) pay such
additional amount to that Lender as is necessary to result in that Lender's
receiving a net after-Tax amount equal to the amount to which that Lender
would have been entitled under this Agreement absent such deduction or
withholding. If and when receipt of such payment results in an excess
payment or credit to that Lender on account of such Taxes, that Lender
shall promptly refund such excess to Borrower.
3.14 FUNDING SOURCES. Nothing in this Agreement shall be deemed to
obligate any Lender to obtain the funds for any Advance (INCLUDING a Eurodollar
Rate Advance) in any particular place (INCLUDING the Designated Eurodollar
Market) or manner or to constitute a representation by any Lender that it has
obtained or will obtain the funds for any Loan or Advance in any particular
place or manner.
3.15 FAILURE TO CHARGE NOT SUBSEQUENT WAIVER. Any decision by the
Managing Agent or any Lender not to require payment of any interest (INCLUDING
interest at the Default Rate), fee, cost or other amount payable under any Loan
Document, or to calculate any amount payable by a particular method, on any
occasion shall in no way limit or be deemed a waiver of the Managing Agent's or
such Lender's right to require full payment of any interest (INCLUDING interest
at the Default Rate), fee, cost or other amount payable under any Loan Document,
or to calculate an amount payable by another method that is not inconsistent
with this Agreement, on any other or subsequent occasion.
3.16 MANAGING AGENT'S RIGHT TO ASSUME PAYMENTS WILL BE MADE BY
BORROWER. Unless the Managing Agent shall have been notified by Borrower prior
to the date on which any payment to be made by Borrower hereunder is due that
Borrower does not intend to remit such payment, the Managing Agent may, in its
discretion, assume that Borrower has remitted such payment when so due and the
Managing Agent may, in its discretion and in reliance upon such assumption, make
available to each Lender on such payment date an amount equal to such Lender's
share of such assumed payment. If Borrower has not in fact remitted such
payment to the Managing Agent, each Lender shall forthwith on demand repay to
the Managing Agent the amount of such
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assumed payment made available to such Lender, together with interest thereon in
respect of each day from and including the date such amount was made available
by the Managing Agent to such Lender to the date such amount is repaid to the
Managing Agent at the Federal Funds Rate.
3.17 FEE DETERMINATION DETAIL. The Managing Agent, and any Lender,
shall provide reasonable detail to Borrower regarding the manner in which the
amount of any payment to the Managing Agent and the Lenders, or that Lender,
under ARTICLE 3 has been determined, concurrently with demand for such payment.
3.18 SURVIVABILITY. All of Borrower's obligations under Sections 3.8
and 3.9 shall survive for ninety (90) days following the date on which the
Commitment is terminated and all Loans hereunder are fully paid, and Borrower
shall remain obligated hereunder for all claims under such Sections made by any
Lender to Borrower prior to the expiration of such period.
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Article 4
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to the Lenders that:
4.1 EXISTENCE AND QUALIFICATION; POWER; COMPLIANCE WITH LAWS.
Borrower and Parent are each a corporation duly formed, validly existing and in
good standing under the Laws of Nevada. Borrower and Parent are each duly
qualified or registered to transact business and is in good standing in each
other jurisdiction in which the conduct of its business or the ownership or
leasing of its Properties makes such qualification or registration necessary,
EXCEPT where the failure so to qualify or register and to be in good standing
would not constitute a Material Adverse Effect. Borrower and Parent each have
all requisite corporate or other organizational power and authority to conduct
its business, to own and lease its Properties and to execute and deliver each
Loan Document to which it is a Party and to perform its Obligations. The chief
executive offices of Borrower are located in Nevada. All outstanding shares of
capital stock of Borrower are duly authorized, validly issued, fully paid and
non-assessable and owned by Parent, and no holder thereof has any enforceable
right of rescission under any applicable state or federal securities Laws.
Borrower is in compliance with all Requirements of Laws applicable to its
business, has obtained all authorizations, consents, approvals, orders, licenses
and permits from, and has accomplished all filings, registrations and
qualifications with, or obtained exemptions from any of the foregoing from, any
Governmental Agency that are necessary for the transaction of its business,
EXCEPT where the failure so to comply, file, register, qualify or obtain
exemptions does not constitute a Material Adverse Effect. The Lenders
acknowledge that Borrower is not required to hold any licenses under applicable
Gaming Laws until the Completion Date and will not apply for such licenses until
shortly prior to the Completion Date pursuant to Section 5.12.
4.2 AUTHORITY; COMPLIANCE WITH OTHER AGREEMENTS AND INSTRUMENTS AND
GOVERNMENT REGULATIONS. The execution, delivery and performance by Borrower and
Parent of the Loan Documents to which it is a Party have been duly authorized by
all necessary corporate or other organizational action, and do not and will not:
(a) Require any consent or approval not heretofore obtained of
any member, partner, director, stockholder, security holder or creditor of
such Party;
(b) Violate or conflict with any provision of such Party's
charter, articles of organization or incorporation, operating agreement or
bylaws, as applicable;
(c) Result in or require the creation or imposition of any Lien
or Right of Others upon or with respect to any Property now owned or leased
or hereafter acquired by such Party;
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(d) Violate any Requirement of Law applicable to such Party,
subject to obtaining the authorizations from, or filings with, the
Governmental Agencies described in SCHEDULE 4.3;
(e) Result in a breach of or constitute a default under, or
cause or permit the acceleration of any obligation owed under, any
indenture or loan or credit agreement or any other Contractual Obligation
to which such Party is a party or by which such Party or any of its
Property is bound or affected;
and neither Borrower nor Parent is in violation of, or default under, any
Requirement of Law or Contractual Obligation, or any indenture, loan or credit
agreement described in Section 4.2(e), in any respect that constitutes a
Material Adverse Effect.
4.3 NO GOVERNMENTAL APPROVALS REQUIRED. EXCEPT as previously
obtained or made, no authorization, consent, approval, order, license or permit
from, or filing, registration or qualification with, any Governmental Agency is
or will be required to authorize or permit under applicable Laws the execution,
delivery or (EXCEPT as set forth in SCHEDULE 4.3) performance by Borrower and
its Subsidiaries or Parent of the Loan Documents to which it is a Party.
Borrower has no reason to believe that the authorizations from, or filings with,
any Governmental Agency described in SCHEDULE 4.3 will not be accomplished on or
before the dates specified in SCHEDULE 4.3.
4.4 SUBSIDIARIES.
(a) SCHEDULE 4.4 hereto correctly sets forth the names, form of
legal entity, number of shares of capital stock issued and outstanding,
number of shares owned by Borrower or a Subsidiary of Borrower (specifying
such owner) and jurisdictions of organization of all Subsidiaries of
Borrower. Except as described in SCHEDULE 4.4 or SCHEDULE 6.15, Borrower
does not own any capital stock, equity interest or debt security which is
convertible, or exchangeable, for capital stock or equity interests in any
Person. Unless otherwise indicated in SCHEDULE 4.4, all of the outstanding
shares of capital stock, or all of the units of equity interest, as the
case may be, of each Subsidiary are owned of record and beneficially by
Borrower, there are no outstanding options, warrants or other rights to
purchase capital stock of any such Subsidiary, and all such shares or
equity interests so owned are duly authorized, validly issued, fully paid
and non-assessable, and were issued in compliance with all applicable state
and federal securities and other Laws, and are free and clear of all Liens
and Rights of Others, EXCEPT for Permitted Encumbrances and Permitted
Rights of Others.
(b) Each Subsidiary of Borrower is a business entity duly
formed, validly existing and in good standing under the Laws of its
jurisdiction of organization, is duly qualified to do business as a foreign
organization and is in good standing as such in each jurisdiction in which
the conduct of its business or the ownership or leasing of its Properties
makes such qualification necessary (EXCEPT
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where the failure to be so duly qualified and in good standing does not
constitute a Material Adverse Effect), and has all requisite power and
authority to conduct its business and to own and lease its Properties.
(c) Each Subsidiary of Borrower is in compliance with all
Requirements of Law applicable to its business and has obtained all
authorizations, consents, approvals, orders, licenses, and permits from,
and each such Subsidiary has accomplished all filings, registrations, and
qualifications with, or obtained exemptions from any of the foregoing from,
any Governmental Agency that are necessary for the transaction of its
business, EXCEPT where the failure to be in such compliance, obtain such
authorizations, consents, approvals, orders, licenses, and permits,
accomplish such filings, registrations, and qualifications, or obtain such
exemptions, does not constitute a Material Adverse Effect.
4.5 FINANCIAL STATEMENTS. Borrower has furnished to the Lenders
(a) the audited consolidated financial statements of Parent and its Subsidiaries
for the Fiscal Year ended Xxxxx 00, 0000, (x) the unaudited consolidated
financial statements of Parent and its Subsidiaries for the Fiscal Quarter ended
June 30, 1996 and (c) the unaudited pro-forma balance sheet of Borrower as of
the Closing Date (giving effect to the transactions occurring on that date).
The financial statements described in clauses (a) and (b) fairly present in all
material respects the financial condition, results of operations and changes in
financial position of Parent, and the pro-forma balance sheet described in
clause (c) fairly presents the financial condition of Borrower, in each case as
of such dates and for such periods in conformity with Generally Accepted
Accounting Principles, consistently applied.
4.6 NO OTHER LIABILITIES; NO MATERIAL ADVERSE CHANGES. Borrower does
not have any material liability or material contingent liability required under
Generally Accepted Accounting Principles to be reflected or disclosed and not
reflected or disclosed in the balance sheet described in Section 4.5(c), other
than liabilities and contingent liabilities arising in the ordinary course of
business since the date of such balance sheet. As of the Closing Date, no
circumstance or event has occurred that constitutes a Material Adverse Effect
since June 30, 1996. As of any date subsequent to the Closing Date, no
circumstance or event has occurred that constitutes a Material Adverse Effect
since the Closing Date.
4.7 TITLE TO PROPERTY. Borrower has valid title to the Property
reflected in the balance sheet described in Section 4.5(c), other than items of
Property or exceptions to title which are in each case immaterial to Borrower,
and Property subsequently sold or disposed of in the ordinary course of
business, free and clear of all Liens and Rights of Others, OTHER THAN Permitted
Encumbrances, Permitted Rights of Others and Liens or Rights of Others described
in SCHEDULE 4.7 or permitted by Section 6.8.
4.8 INTANGIBLE ASSETS. Borrower owns, or possesses the right to use
pursuant to a written license agreement to the extent necessary in
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its business, all material trademarks, trade names, copyrights, patents,
patent rights and other Intangible Assets that are used in the conduct of its
business as now operated, and no such Intangible Asset, to the best knowledge
of Borrower, conflicts with the valid trademark, trade name, copyright,
patent, patent right or Intangible Asset of any other Person to the extent
that such conflict constitutes a Material Adverse Effect. SCHEDULE 4.8 sets
forth all trademarks, trade names and trade styles owned by Borrower or which
Borrower has the right to use and describes with particularity all written
license agreements pursuant to which Borrower has the right to use the same.
4.9 PUBLIC UTILITY HOLDING COMPANY ACT. Neither Borrower nor any of
its Subsidiaries is a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
4.10 LITIGATION. EXCEPT for (a) any matter fully covered as to
subject matter and amount (subject to applicable deductibles and retentions) by
insurance as to which the insurance carrier has been notified and has not
asserted lack of subject matter coverage or reserved its right to do so, (b) any
matter, or series of related matters, involving a claim against Borrower or any
of its Subsidiaries of less than $2,000,000, (c) matters of an administrative
nature not involving a claim or charge against Borrower or any of its
Subsidiaries and (d) matters set forth in SCHEDULE 4.10, there are no actions,
suits, proceedings or investigations pending as to which Borrower or any of its
Subsidiaries have been served or have received notice or, to the best knowledge
of Borrower, threatened against or affecting Borrower or any of its Subsidiaries
or any Property of any of them before any Governmental Agency.
4.11 BINDING OBLIGATIONS. Each of the Loan Documents to which
Borrower, any of its Subsidiaries or Parent is a Party will, when executed and
delivered by such Party, constitute the legal, valid and binding obligation of
such Party, enforceable against such Party in accordance with its terms, EXCEPT
as enforcement may be limited by Debtor Relief Laws, Gaming Laws or equitable
principles relating to the granting of specific performance and other equitable
remedies as a matter of judicial discretion.
4.12 NO DEFAULT. No event has occurred and is continuing that is a
Default or Event of Default.
4.13 ERISA.
(a) With respect to each Pension Plan:
(i) such Pension Plan complies in all material
respects with ERISA and any other applicable Laws to the extent
that noncompliance could reasonably be expected to have a Material
Adverse Effect;
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(ii) such Pension Plan has not incurred any
"accumulated funding deficiency" (as defined in Section 302 of
ERISA) that could reasonably be expected to have a Material
Adverse Effect;
(iii) no "reportable event" (as defined in Section
4043 of ERISA) has occurred that could reasonably be expected to
have a Material Adverse Effect; and
(iv) neither Borrower nor any of its ERISA
Affiliates has engaged in any non-exempt "prohibited transaction"
(as defined in Section 4975 of the Code) that could reasonably be
expected to have a Material Adverse Effect.
(b) Neither Borrower nor any of its ERISA Affiliates has
incurred or expects to incur any withdrawal liability to any Multiemployer
Plan that could reasonably be expected to have a Material Adverse Effect.
4.14 REGULATIONS G, T, U AND X; INVESTMENT COMPANY ACT. No part of
the proceeds of any Loan hereunder will be used to purchase or carry, or to
extend credit to others for the purpose of purchasing or carrying, any Margin
Stock in violation of Regulations G, T, U and X. Neither Borrower nor any of
its Subsidiaries is or is required to be registered as an "investment company"
under the Investment Company Act of 1940.
4.15 DISCLOSURE. No written statement made by a Senior Officer of
Borrower to the Managing Agent or any Lender in connection with this Agreement,
or in connection with any Loan, as of the date thereof contained any untrue
statement of a material fact or omitted a material fact necessary to make the
statement made not misleading in light of all the circumstances existing at the
date the statement was made.
4.16 TAX LIABILITY. Borrower and its Subsidiaries have filed all tax
returns which are required to be filed, and have paid, or made provision for the
payment of, all taxes with respect to the periods, Property or transactions
covered by said returns, or pursuant to any assessment received by Borrower or
its Subsidiaries, EXCEPT (a) such taxes, if any, as are being contested in good
faith by appropriate proceedings and as to which adequate reserves have been
established and maintained and (b) immaterial taxes so long as no material
Property of Borrower or any of its Subsidiaries is at impending risk of being
seized, levied upon or forfeited.
4.17 PROJECTIONS. As of the Closing Date, Borrower believes that the
assumptions set forth in the Projections are reasonable and consistent with each
other and with all facts known to Borrower, and that the Projections are
reasonably based on such assumptions. Nothing in this Section 4.17 shall be
construed as a representation or covenant that the Projections in fact will be
achieved.
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4.18 HAZARDOUS MATERIALS. Except as described in SCHEDULE 4.18, as
of the Closing Date (a) neither Borrower nor any of its Subsidiaries at any time
has disposed of, discharged, released or threatened the release of any Hazardous
Materials on, from or under the Real Property in violation of any Hazardous
Materials Law that would individually or in the aggregate constitute a Material
Adverse Effect, (b) to the best knowledge of Borrower, no condition exists that
violates any Hazardous Material Law affecting any Real Property except for such
violations that would not individually or in the aggregate have a Material
Adverse Effect, (c) no Real Property or any portion thereof is or has been
utilized by Borrower or any of its Subsidiaries as a site for the manufacture of
any Hazardous Materials and (d) to the extent that any Hazardous Materials are
used, generated or stored by Borrower or any of its Subsidiaries on any Real
Property, or transported to or from such Real Property by Borrower or any of its
Subsidiaries, such use, generation, storage and transportation are in compliance
with all Hazardous Materials Laws except for such non-compliance that would not
constitute a Material Adverse Effect or be materially adverse to the interests
of the Lenders.
4.19 GAMING LAWS. Borrower is in compliance with all Gaming Laws
except for such non-compliance that would not constitute a Material Adverse
Effect.
4.20 SECURITY INTERESTS. Upon the execution and delivery of the
Security Agreement, the Security Agreement will create a valid first priority
security interest in the Collateral described therein securing the Obligations
(subject only to Permitted Encumbrances, Permitted Rights of Others and matters
disclosed in SCHEDULE 4.7 and to such qualifications and exceptions as are
contained in the Uniform Commercial Code with respect to the priority of
security interests perfected by means other than the filing of a financing
statement or with respect to the creation of security interests in Property to
which Article 9 of the Uniform Commercial Code does not apply) and all action
necessary to perfect the security interest so created, OTHER THAN filing of the
UCC-1 financing statements delivered to the Managing Agent pursuant to
Section 9.1 with the appropriate Governmental Agency, have been taken and
completed. Upon the execution and delivery of the Collateral Assignment, the
Collateral Assignment will create a valid first priority security interest in
the Collateral described therein securing the Obligations and all action
necessary to perfect the security interest so created, OTHER THAN filing of the
UCC-1 financing statements delivered to the Managing Agent pursuant to
Section 9.1 with the appropriate Governmental Agency, have been taken and
completed. Upon the execution and delivery of the Pledge Agreement, the Pledge
Agreement will create a valid first priority security interest in the Pledged
Collateral and upon delivery of the Pledged Collateral to the Managing Agent (or
its designee) in the State of Nevada all action necessary to perfect the
security interest so created has been taken and completed. Upon the execution
and delivery of the Deed of Trust, such Deed of Trust will create a valid Lien
in the Collateral described therein securing the Obligations, OTHER THAN those
arising under Sections 4.18, 5.11 and 12.22, (subject only to Permitted
Encumbrances, Permitted Rights of Others and matters described in SCHEDULE 4.7),
and all action necessary to perfect the Lien so created,
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OTHER than recordation or filing thereof with the appropriate Governmental
Agencies,will have been taken and completed.
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Article 5
AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND
REPORTING REQUIREMENTS)
So long as any Advance remains unpaid or any other Obligation remains
unpaid, or any portion of the Commitment remains in force, Borrower shall, and
shall cause each of its Subsidiaries to, unless the Managing Agent (with the
written approval of the Requisite Lenders) otherwise consents:
5.1 PAYMENT OF TAXES AND OTHER POTENTIAL LIENS. Pay and discharge
promptly all taxes, assessments and governmental charges or levies imposed upon
any of them, upon their respective Property or any part thereof and upon their
respective income or profits or any part thereof, EXCEPT that Borrower and its
Subsidiaries shall not be required to pay or cause to be paid (a) any tax,
assessment, charge or levy that is not yet past due, or is being contested in
good faith by appropriate proceedings so long as the relevant entity has
established and maintains adequate reserves for the payment of the same or
(b) any immaterial tax so long as no material Property of Borrower or any of its
Subsidiaries is at impending risk of being seized, levied upon or forfeited.
5.2 PRESERVATION OF EXISTENCE. Preserve and maintain their
respective existences in the jurisdiction of their formation and all material
authorizations, rights, franchises, privileges, consents, approvals, orders,
licenses, permits, or registrations from any Governmental Agency that are
necessary for the transaction of their respective business and qualify and
remain qualified to transact business in each jurisdiction in which such
qualification is necessary in view of their respective business or the ownership
or leasing of their respective Properties EXCEPT where the failure to so qualify
or remain qualified would not constitute a Material Adverse Effect.
5.3 MAINTENANCE OF PROPERTIES. Maintain, preserve and protect all of
their respective Properties in good order and condition, subject to wear and
tear in the ordinary course of business, and not permit any waste of their
respective Properties, EXCEPT that the failure to maintain, preserve and protect
a particular item of Property that is not of significant value, either
intrinsically or to the operations of Borrower and its Subsidiaries, taken as a
whole, shall not constitute a violation of this covenant.
5.4 MAINTENANCE OF INSURANCE. Maintain liability, casualty and other
insurance (subject to customary deductibles and retentions) with responsible
insurance companies in such amounts and against such risks as is carried by
responsible companies engaged in similar businesses and owning similar assets in
the general areas in which Borrower and its Subsidiaries operate and, in any
event, such insurance as is required under the Deed of Trust.
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5.5 COMPLIANCE WITH LAWS. Comply, within the time period, if any,
given for such compliance by the relevant Governmental Agency or Agencies with
enforcement authority, with all Requirements of Law noncompliance with which
constitutes a Material Adverse Effect, EXCEPT that Borrower and its Subsidiaries
need not comply with a Requirement of Law then being contested by any of them in
good faith by appropriate proceedings.
5.6 INSPECTION RIGHTS. Upon reasonable notice, at any time during
regular business hours and as often as reasonably requested (but not so as to
materially interfere with the business of Borrower or any of its Subsidiaries)
permit the Managing Agent or any Lender, or any authorized employee, agent or
representative thereof, to examine, audit and make copies and abstracts from the
records and books of account of, and to visit and inspect the Properties of,
Borrower and its Subsidiaries and to discuss the affairs, finances and accounts
of Borrower and its Subsidiaries with any of their officers, managers, key
employees or accountants.
5.7 KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Keep adequate records
and books of account reflecting all financial transactions in conformity with
Generally Accepted Accounting Principles, consistently applied, and in material
conformity with all applicable requirements of any Governmental Agency having
regulatory jurisdiction over Borrower or any of its Subsidiaries.
5.8 COMPLIANCE WITH AGREEMENTS. Promptly and fully comply with all
Contractual Obligations under all material agreements, indentures, leases and/or
instruments to which any one or more of them is a party, whether such material
agreements, indentures, leases or instruments are with a Lender or another
Person, EXCEPT for any such Contractual Obligations (a) the performance of which
would cause a Default or (b) then being contested by any of them in good faith
by appropriate proceedings or if the failure to comply with such agreements,
indentures, leases or instruments does not constitute a Material Adverse Effect.
5.9 USE OF PROCEEDS. Use the proceeds of Loans solely for the
construction (INCLUDING financing expenses and Pre-Opening Expenses) and
furnishing of the Project.
5.10 NEW SUBSIDIARIES. Cause any Person which hereafter becomes a
Subsidiary of Borrower to execute and deliver to the Managing Agent the
Subsidiary Guaranty and an instrument of joinder of the Security Agreement, and
(subject to compliance with applicable Gaming Laws) deliver the certificates
evidencing all equity interests in such Subsidiary to the Managing Agent in
pledge pursuant to a pledge agreement substantially in the form of the Pledge
Agreement.
5.11 HAZARDOUS MATERIALS LAWS. Keep and maintain all Real Property
and each portion thereof in compliance with all applicable Hazardous Materials
Laws (except for such non-compliance that would not constitute a Material
Adverse Effect or be materially adverse to the interests of the Lenders) and
promptly notify the Managing Agent in writing (attaching a copy of any pertinent
written material) of (a) any and all
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material enforcement, cleanup, removal or other governmental or regulatory
actions instituted, completed or threatened in writing by a Governmental
Agency pursuant to any applicable Hazardous Materials Laws, (b) any and all
material claims made or threatened in writing by any Person against Borrower
relating to damage, contribution, cost recovery, compensation, loss or injury
resulting from any Hazardous Materials and (c) discovery by any Senior
Officer of Borrower of any material occurrence or condition on any real
Property adjoining or in the vicinity of such Real Property that could
reasonably be expected to cause such Real Property or any part thereof to be
subject to any restrictions on the ownership, occupancy, transferability or
use of such Real Property under any applicable Hazardous Materials Laws.
5.12 GAMING LICENSES. File applications with all relevant Gaming
Boards for all licenses, permits and approvals under applicable Gaming Laws
necessary to operate the Project at such date as Borrower deems appropriate in
the exercise of prudent business judgment to permit the Completion Date to occur
as scheduled, and diligently pursue such applications thereafter; PROVIDED that
the Lenders acknowledge that such Gaming Boards have the power to approve or
disapprove the pledge of the Pledged Collateral pursuant to the Pledge Agreement
and to condition approval of such pledge on revision to the form of the Pledge
Agreement.
5.13 SUPPLEMENTAL CREDIT FACILITY. (a) Promptly following its
awareness of a failure to comply with Sections 6.11, 6.12 or 6.13, make a
written request for a Supplemental Loan under Section 2.01(a) of the
Supplemental Loan Agreement in an amount equal to the lesser of (i) the amount
necessary to effect an Effected Cure with respect to such Section or (ii) the
maximum amount of Supplemental Loans which are then available to be made under
Section 2.01(a) of the Supplemental Loan Agreement, and concurrently provide a
copy of such written request to the Managing Agent.
(b) Promptly following its exercise of the early termination option
under Section 5.4 of the Equipment Sublease (which Borrower shall not exercise
unless Supplemental Loans in amounts sufficient for such exercise are available
under the Supplemental Credit Facility ), make a written request for a
Supplemental Loan under Section 2.01(b) of the Supplemental Loan Agreement in an
amount equal to the amount required to be paid under the Equipment Sublease in
connection with such exercise, and concurrently provide a copy of such written
request to the Managing Agent.
(c) Promptly following its exercise of the purchase option under
Section 5.3(a) of the Equipment Sublease, make a written request for a
Supplemental Loan under Section 2.01(c) of the Supplemental Loan Agreement in an
amount equal to the lesser of (i) the amount required to be paid under the
Sublease in connection with such exercise and (ii) the maximum amount of a
Supplemental Loan which is then available to be made under Section 2.01(c) of
the Supplemental Loan Agreement, and concurrently provide a copy of such written
request to the Managing Agent.
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Article 6
NEGATIVE COVENANTS
So long as any Advance remains unpaid or any other Obligation remains
unpaid, or any portion of the Commitment remains in force, Borrower shall not,
and shall not permit any of its Subsidiaries to, unless the Managing Agent (with
the written approval of the Requisite Lenders or, if required by Section 12.2,
of the Supermajority Lenders or all of the Lenders) otherwise consents:
6.1 PAYMENT OF SUBORDINATED OBLIGATIONS. Pay any (a) principal
(INCLUDING sinking fund payments) or any other amount (OTHER THAN scheduled
interest payments) with respect to any Subordinated Obligation, or purchase or
redeem (or offer to purchase or redeem) any Subordinated Obligation, or deposit
any monies, securities or other Property with any trustee or other Person to
provide assurance that the principal or any portion thereof of any Subordinated
Obligation will be paid when due or otherwise to provide for the defeasance of
any Subordinated Obligation or (b) scheduled interest on any Subordinated
Obligation EXCEPT interest consisting of additional units of such Subordinated
Obligation.
6.2 DISPOSITION OF PROPERTY. Make any Disposition of its Property,
whether now owned or hereafter acquired, EXCEPT (a) Disposition of a portion or
portions of the Project Property of up to approximately 25 acres in the
aggregate on which no Project improvements are planned to be constructed by
Borrower; PROVIDED that (i) such portion or portions has been properly
subdivided from the Project Property in compliance with all applicable Laws,
(ii) the transfer of such portion does not result in diminished public access to
the Project Property, (iii) the remaining portion of the Project Property is a
legally-transferable parcel in compliance with applicable Laws and (iv) the Net
Cash Proceeds in excess of $6,000,000 of such Disposition (or Dispositions in
the aggregate) are paid to the Managing Agent as a prepayment pursuant to
Section 3.1(G) (and, for this purpose, the limitations therein shall be
disregarded) on the last day of the next expiring Eurodollar Period and
(b) Dispositions of Property having an aggregate book value or fair market value
(whichever is greater) in any Fiscal Year not exceeding $1,000,000. Any
Property which is the subject of a Disposition permitted by this Section shall
be released from the Lien of the Collateral Documents upon request of Borrower.
6.3 MERGERS. Merge or consolidate with or into any Person, EXCEPT
mergers and consolidations of a Subsidiary of Borrower into Borrower.
6.4 HOSTILE ACQUISITIONS. Directly or indirectly use the proceeds of
any Loan in connection with the acquisition of part or all of a voting interest
of five percent (5%) or more in any corporation or other business entity if such
acquisition is opposed by the board of directors or management of such
corporation or business entity.
6.5 DISTRIBUTIONS. Make any Distribution, whether from capital,
income or otherwise, and whether in Cash or other Property, EXCEPT
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(a) Distributions by a Subsidiary of Borrower to Borrower, (b) Distributions
payable solely in the common stock of Borrower PROVIDED that the certificates
evidencing such common stock are concurrently delivered to the Managing Agent
as additional Pledged Collateral (subject to any necessary approval of a Gaming
Board) and (c) a Distribution made within thirty (30) days after the Closing
Date in an amount not greater than the amount (if any) by which the
Stockholders' Equity of Borrower on the Closing Date exceeded $52,000,000.
6.6 ERISA. (a) At any time, permit any Pension Plan to (i) engage in
any non-exempt "prohibited transaction" (as defined in Section 4975 of the
Code), (ii) fail to comply with ERISA or any other applicable Laws, (iii) incur
any material "accumulated funding deficiency" (as defined in Section 302 of
ERISA), or (iv) terminate in any manner, which, with respect to each event
listed above, could reasonably be expected to result in a Material Adverse
Effect, or (b) withdraw, completely or partially, from any Multiemployer Plan if
to do so could reasonably be expected to result in a Material Adverse Effect.
6.7 CHANGE IN NATURE OF BUSINESS. Make any material change in the
nature of the business of Borrower and its Subsidiaries, taken as a whole.
6.8 LIENS AND NEGATIVE PLEDGES. Create, incur, assume or suffer to
exist any Lien or Negative Pledge of any nature upon or with respect to any of
its Properties, or engage in any sale and leaseback transaction with respect to
any of its Properties, whether now owned or hereafter acquired, EXCEPT:
(a) Permitted Encumbrances;
(b) Liens and Negative Pledges arising under the Loan Documents;
(c) Liens and Negative Pledges existing on the Closing Date and
disclosed in SCHEDULE 4.7 and any renewals/extensions or amendments
thereof, PROVIDED that the obligations secured or benefited thereby are not
increased; and
(d) Liens and Negative Pledges arising under the Realty Lease
and the Equipment Lease.
6.9 INDEBTEDNESS AND GUARANTY OBLIGATIONS. Create, incur or assume
any Indebtedness or Guaranty Obligation EXCEPT:
(a) Indebtedness and Guaranty Obligations existing on the
Closing Date and disclosed in SCHEDULE 6.9, and refinancings, renewals,
extensions or amendments that do not increase the amount thereof;
(b) Indebtedness and Guaranty Obligations under the Loan
Documents;
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(c) Indebtedness consisting of Supplemental Loans owed to
Parent;
(d) Indebtedness owed to Borrower by a Subsidiary of Borrower,
Indebtedness owed to a wholly owned Subsidiary of Borrower by Borrower and
Guaranty Obligations with respect thereto;
(e) Indebtedness of Borrower consisting of one or more Swap
Agreements; PROVIDED, that the aggregate notional amount of Indebtedness
covered by all Secured Swap Agreements shall not exceed $50,000,000 and;
(f) Guaranty Obligations in support of the obligations of a
Subsidiary of Borrower that are not prohibited by Section 6.18.
6.10 TRANSACTIONS WITH AFFILIATES. Enter into any transaction of any
kind with any Affiliate of Borrower OTHER THAN (a) salary, bonus, employee stock
option and other compensation arrangements with directors, officers or managers
in the ordinary course of business, (b) transactions that are fully disclosed to
the board of directors of Borrower and expressly authorized by a resolution of
the board of directors of Borrower which is approved by a majority of the
directors not having an interest in the transaction, (c) the Equipment Sublease,
the Supplemental Loan Agreement, the Assignment and Assumption of the Realty
Lease and the Management Agreement referred to in Section 9.1(A)(29),
(d) transactions expressly permitted by this Agreement, (e) transactions between
or among Borrower and its Subsidiaries and (f) transactions on overall terms at
least as favorable to Borrower or its Subsidiaries as would be the case in an
arm's-length transaction between unrelated parties of equal bargaining power.
6.11 SENIOR FUNDED DEBT RATIO. Permit the Senior Funded Debt Ratio,
as of the last day of any Fiscal Quarter ending after the Completion Date, to be
greater than the ratio set forth below opposite such Fiscal Quarter:
FISCAL QUARTER RATIO
First and Second Fiscal Quarters
after Completion Date 4.50 to 1.00
Third and Fourth Fiscal Quarters
after Completion Date 4.25 to 1.00
Fifth and Sixth Fiscal Quarters
after Completion Date 4.00 to 1.00
Seventh and Eighth Fiscal Quarters
after Completion Date 3.75 to 1.00
Ninth Quarter after
Completion Date 3.50 to 1.00
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Each Fiscal Quarter
thereafter 3.25 to 1.00;
PROVIDED that (a) the initial partial Fiscal Quarter shall be disregarded for
this purpose and the First Fiscal Quarter after the Completion Date shall be the
first full such Fiscal Quarter and (b) if both the Parent Bank Credit Facility
and the Equipment Lease cease to be in effect at any time after the date that is
six (6) months after the Completion Date, the maximum Senior Funded Debt Ratio
under this Section 6.11 shall thereafter be 3.25 to 1.00 commencing with the
last day of the first Fiscal Quarter ending after the date of such cessation.
6.12 FIXED CHARGE COVERAGE RATIO. Permit the Fixed Charge Coverage
Ratio, as of the last day of any Fiscal Quarter ending after the Completion
Date, to be less than 1.10 to 1.00; PROVIDED that the initial partial Fiscal
Quarter after the Completion Date shall be disregarded for this purpose.
6.13 EFFECTIVE NET WORTH. Permit Effective Net Worth, as of the last
day of any Fiscal Quarter ending after the Completion Date, to be less than the
SUM OF (a) $52,000,000 PLUS (b) 80% of Net Income for each Fiscal Quarter ending
after the Completion Date (with no deduction for any net loss incurred in any
such Fiscal Quarter) PLUS (c) 100% of any Cash Equity Contributions and
Supplemental Loans made after the Closing Date.
6.14 CAPITAL EXPENDITURES. Make, or become legally obligated to make,
any Capital Expenditure after the Completion Date OTHER THAN (a) Maintenance
Capital Expenditures and then only if, giving effect thereto, the aggregate
Maintenance Capital Expenditures made in that Fiscal Year would not exceed
$2,000,000, (b) Capital Expenditures made after the date that is three (3)
months after the Completion Date, PROVIDED that (i) such Capital Expenditures
are funded in their entirety by Qualified Capital Sources received subsequent to
the Closing Date, (ii) the aggregate such Capital Expenditures made during the
term of this Agreement for (A) (i) a parking garage and related amenities does
not exceed $20,000,000 or (ii) an additional hotel tower does not exceed
$30,000,000 and (B) any other single project or a series of related projects
does not exceed $5,000,000 or exceed $20,000,000 in the aggregate for all such
other projects and (c) Capital Expenditures consisting of the purchase of the
Leased Equipment pursuant to the terms of the Equipment Sublease and made out of
the proceeds of Supplemental Loans under Section 2.01(b) or (c) of the
Supplemental Credit Facility or Cash Equity Contributions, PROVIDED that such
proceeds or Cash Equity Contributions are sufficient for such purchase.
6.15 INVESTMENTS. Make or suffer to exist any Investment, OTHER
THAN:
(a) Investments in existence on the Closing Date and disclosed
on SCHEDULE 6.15;
(b) Investments consisting of Cash Equivalents;
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(c) Investments consisting of advances to officers, managers,
directors and employees of Borrower and its Subsidiaries for travel,
entertainment, relocation and analogous ordinary business purposes;
(d) Investments in wholly-owned Subsidiaries;
(e) Investments consisting of or evidencing the extension of
credit to customers or suppliers of Borrower and its Subsidiaries in the
ordinary course of business and any Investments received in satisfaction or
partial satisfaction thereof;
(f) Investments received in connection with the settlement of a
bona fide dispute with another Person; and
(g) Investments consisting of Guaranty Obligations permitted by
Section 6.9.
6.16 ACQUISITIONS. Make any Acquisition.
6.17 OPERATING LEASES. Enter, assume or otherwise incur any
obligation as lessee or sublessee under any operating lease (OTHER THAN the
Equipment Sublease and the Realty Lease) if to do so would result in the
aggregate obligation of Borrower and its Subsidiaries to pay rent and other
monetary amounts under all operating leases (OTHER THAN the Equipment Sublease
and the Realty Lease) to exceed $5,000,000 in any Fiscal Year.
6.18 SUBSIDIARY INDEBTEDNESS. Permit (whether or not otherwise
permitted under Section 6.9) any Subsidiary to create, incur, assume or suffer
to exist any Indebtedness or Guaranty Obligation, EXCEPT (a) the Subsidiary
Guaranty or (b) Indebtedness owed to Borrower or another Subsidiary of Borrower.
6.19 MANAGEMENT FEES. Accrue, in any Fiscal Year, to Parent or any
Affiliate of Parent a Management Fee in excess of $600,000.
6.20 AMENDMENTS TO EQUIPMENT SUBLEASE. Amend, modify or waive any
term or provision of the Equipment Sublease or consent to its termination
(except termination in accordance with its terms), or exercise any election or
option (other than an option related to any such termination in accordance with
its terms) which it may have thereunder without the prior written consent of the
Supermajority Lenders.
6.21 SUPPLEMENTAL LOAN AGREEMENT. Amend, modify, or waive any term
or provision of the Supplemental Loan Agreement, or consent to its termination,
without the prior written consent of the Supermajority Lenders.
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Article 7
CONSTRUCTION PERIOD COVENANTS
Borrower shall, unless the Managing Agent (with the written approval
of the Requisite Lenders) otherwise consents, during the Construction Period:
7.1 CONSTRUCTION OF PROJECT. Proceed diligently and without
interruption (EXCEPT as may be caused by events outside the control of Borrower)
to construct and furnish the Project in accordance in all material respects with
the Construction Plans, the Construction Budget and the Construction Timetable,
and in any event cause the Completion Date to occur not later than December 31,
1997.
7.2 AMENDMENTS TO PLANS AND BUDGETS. Not make any change to the
Construction Plans or Construction Budget which (a) would allocate or require
the allocation of the $10,000,000 "contingency" line item in the Construction
Budget to a significant change in the Construction Plans or to any line item not
included in the Construction Budget as of the Closing Date, (b) would increase
the Construction Budget to more than $202,000,000 unless the excess amount is
funded in its entirety by Cash Equity Contributions made subsequent to the
Closing Date or (c) would increase the Construction Budget in any event to more
than $207,000,000.
7.3 TIMETABLE. Not make any change to the Construction Plans, the
Construction Budget or the Construction Timetable which would cause the
Completion Date to occur after September 30, 1997.
7.4 CONSTRUCTION REQUIREMENTS. Construct the Project in a good and
workmanlike manner in accordance with sound building practices and the
Construction Plans, and comply in all material respects with all existing Laws
and requirements of all Governmental Agencies having jurisdiction over the
Project and with all future Laws and requirements that become applicable to the
Project prior to the Completion Date.
7.5 CONSTRUCTION SERVICES GROUP. Engage CSG, at the expense of
Borrower, to monitor the construction of the Project and provide CSG with such
information and access to the Project and individuals employed by Borrower, the
Architect and the Contractor as it may reasonably request for that purpose.
7.6 NOTICE OF CHANGES. Promptly provide the Managing Agent and CSG
with copies of all changes to the Construction Plans, Construction Budget,
Construction Timetable, Construction Contracts and Architect Contracts, and with
an advance draft copy of any proposed such change that involves more than
$1,000,000.
7.7 CONSTRUCTION PROGRESS REPORTS. Assist and cooperate with CSG in
all respects reasonably requested by CSG in order to permit CSG to provide such
periodic construction progress reports to the Managing Agent and the Lenders as
may be reasonably requested by the Managing Agent.
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7.8 CONSTRUCTION INFORMATION. Promptly provide to the Managing Agent
and CSG such information and documents respecting the Project as either may
reasonably request from time to time, INCLUDING detailed identification of each
significant subcontractor or supplier to the Project and the nature and dollar
amount of the related subcontract or supply contract.
7.9 CONSTRUCTION, PERMITS, LICENSES AND APPROVALS. Properly obtain,
comply with and keep in effect all permits, licenses and approvals which are
customarily required to be obtained from Governmental Agencies in order to
construct and occupy the Project as of the then current stage of construction,
and deliver copies of all such permits, licenses and approvals to the Managing
Agent promptly following a request therefor.
7.10 PURCHASE OF MATERIALS. Not purchase or contract for any
materials, equipment, furnishings, fixtures or articles of personal property to
be placed or installed on the Project Property under any security agreement or
other agreement where the seller reserves or purports to reserve title or the
right of removal or repossession (EXCEPT for such reservations as may arise
solely by operation of Law), or the right to consider such materials personal
property after their incorporation in the work of construction except for the
Equipment Sublease or unless the Managing Agent in each instance has authorized
Borrower to do so in writing.
7.11 PURCHASE OF OFFSITE MATERIALS. Promptly notify the Managing
Agent if it purchases (and pays all or a portion of the purchase price therefor)
any construction materials for the Project that are not located on the Project
Property, or will not be delivered to the Project Property within fifteen (15)
days after purchase (describing such construction materials, the purchase price
therefor and the location thereof) and, if requested by the Managing Agent,
provide to the Managing Agent the written acknowledgement of the Person having
custody of such construction materials of the existence of the Lenders' Lien on
such construction materials and the right of the Managing Agent to have access
to and to remove such construction materials at reasonable times.
7.12 SITE VISITS. Permit the Managing Agent, or any Lender, at any
reasonable time to enter and visit the Project Property for the purposes of
performing an appraisal, observing the work of construction and examining all
materials, plans, specifications, working drawings and other matters relating to
the construction of the Project.
7.13 PROTECTION AGAINST LIEN CLAIMS. Promptly pay when due (subject
to applicable retentions) or otherwise discharge all claims and Liens for labor
done and materials and services furnished in connection with the construction of
the Project, EXCEPT for claims contested in good faith by appropriate
proceedings and without prejudice to the Construction Timetable, PROVIDED that
any such claims are covered by such payment bonds or title insurance policy
endorsements as may be requested by the Managing Agent.
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7.14 COMPLETION CERTIFICATES. Upon completion of the Project,
provide the Managing Agent with a written certificate executed by the Architect
and Contractor certifying that the Project has been completed in all material
respects in accordance with the Construction Plans and complies in all material
respects with all applicable zoning, building and land use Laws and that the
Project is ready to be opened for business and upon the occurrence of the
Completion Date provide the Managing Agent with a Certificate executed by a
Senior Officer to that effect.
7.15 COMPLETION SURVEY. As soon as practicable after completion of
the Project, provide the Managing Agent with an ALTA survey of the Project
Property that (a) demonstrates compliance of the Project in all material
respects with all applicable Laws and requirements of Governmental Agencies,
(b) sets forth all easements and licenses burdening the Project Property,
(c) reflects no encroachments onto the Project Property and no encroachments by
the Project onto adjoining real property and (d) certifies the legal description
of the Project Property to be the same as that set forth in the title insurance
policies referred to in Section 9.1(A)(15).
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Article 8
INFORMATION AND REPORTING REQUIREMENTS
8.1 FINANCIAL AND BUSINESS INFORMATION. So long as any Advance
remains unpaid or any other Obligation remains unpaid, or any portion of the
Commitment remains in force, Borrower shall, unless the Managing Agent (with the
written approval of the Requisite Lenders) otherwise consents, at Borrower's
sole expense, deliver to the Managing Agent for distribution by it to the
Lenders, a sufficient number of copies for all of the Lenders of the following:
(a) As soon as practicable, and in any event by the 20th day of
the next following month, a construction progress report as of the last day
of the preceding calendar month during the Construction Period in a form
reasonably acceptable to the Managing Agent, which report shall compare the
status of construction and amounts expended to the Construction Timetable
and the Construction Budget; PROVIDED that the construction progress
reports delivered by CSG pursuant to Section 7.7 shall satisfy the form of
this requirement unless the Managing Agent notifies Borrower to the
contrary;
(b) As soon as practicable, and in any event by the 30th day of
the next following month, financial statements of Borrower for the
preceding calendar month (commencing with the first full calendar month
after the Completion Date) in a form reasonably acceptable to the Managing
Agent, together with a written narrative statement discussing any
significant trends reflected therein signed by a Senior Officer of
Borrower;
(c) As soon as practicable, and in any event within 45 days
after the end of each Fiscal Quarter (OTHER THAN the fourth Fiscal Quarter
in any Fiscal Year), (i) the consolidated balance sheet of Borrower and its
Subsidiaries as at the end of such Fiscal Quarter and the consolidated
statement of operations for such Fiscal Quarter, and its statement of cash
flows for the portion of the Fiscal Year ended with such Fiscal Quarter and
(ii) if applicable and if requested by the Managing Agent, the
consolidating balance sheets and statements of operations as at and for the
portion of the Fiscal Year ended with such Fiscal Quarter, all in
reasonable detail. Such financial statements shall be certified by a
Senior Officer of Borrower as fairly presenting the financial condition,
results of operations and cash flows of Borrower and its Subsidiaries in
accordance with Generally Accepted Accounting Principles (OTHER THAN
footnote disclosures), consistently applied, as at such date and for such
periods, subject only to normal year-end accruals and audit adjustments;
(d) As soon as practicable, and in any event within 120 days
after the end of each Fiscal Year, (i) the consolidated balance sheet of
Borrower and its Subsidiaries as at the end of such Fiscal Year and the
consolidated statements of operations,
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stockholders' equity and cash flows, in each case of Borrower
and its Subsidiaries for such Fiscal Year and (ii) if applicable
and if requested by the Managing Agent, consolidating balance
sheets and statements of operations, in each case as at the end of
and for the Fiscal Year, all in reasonable detail. Such financial
statements shall be prepared in accordance with Generally Accepted
Accounting Principles, consistently applied, and such consolidated balance
sheet and consolidated statements shall be accompanied by a report of one
of the six largest public accounting firms in the United States of America
or other independent public accountants of recognized standing selected by
Borrower and reasonably satisfactory to the Requisite Lenders, which report
shall be prepared in accordance with generally accepted auditing standards
as at such date, and shall not be subject to any qualifications or
exceptions as to the scope of the audit nor to any other qualification or
exception determined by the Requisite Lenders in their good faith business
judgment to be adverse to the interests of the Lenders. Such accountants'
report shall be accompanied by a certificate stating that, in making the
examination pursuant to generally accepted auditing standards necessary for
the certification of such financial statements and such report, such
accountants have obtained no knowledge of any Default or, if, in the
opinion of such accountants, any such Default shall exist, stating the
nature and status of such Default, and stating that such accountants have
reviewed Borrower's financial calculations as at the end of such Fiscal
Year (which shall accompany such certificate) under Sections 6.11 through
6.14, have read such Sections (including the definitions of all defined
terms used therein) and that nothing has come to the attention of such
accountants in the course of such examination that would cause them to
believe that the same were not calculated by Borrower in the manner
prescribed by this Agreement;
(e) As soon as practicable, and in any event within 45 days
after the commencement of each Fiscal Year, a budget and projection by
Fiscal Quarter for that Fiscal Year and by Fiscal Year for the next four
succeeding Fiscal Years, INCLUDING for the first such Fiscal Year,
projected consolidated balance sheets, statements of operations and
statements of cash flow and, for the second and third such Fiscal Years,
projected consolidated condensed balance sheets and statements of
operations and cash flows, of Borrower and its Subsidiaries, all in
reasonable detail;
(f) Promptly after request by the Managing Agent or any Lender,
copies of any detailed audit reports, management letters or recommendations
submitted to the board of directors (or the audit committee of the board of
directors) of Borrower by independent accountants in connection with the
accounts or books of Borrower or any of its Subsidiaries, or any audit of
any of them;
(g) Concurrently with delivery thereof to the banks under the
Parent Bank Credit Facility, copies of the quarterly and annual financial
statements of Parent furnished to such banks by Parent (or, if there is at
any time no Parent Bank Credit Facility, the financial statements required
to be delivered under the Parent
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Bank Credit Facility as it existed immediately prior to its ceasing to be
in effect); PROVIDED that the delivery of any such financial statements
to the agent under the Parent Bank Credit Facility shall satisfy the
requirement of this Section 8.1(G) as to any Lender that is also a bank
under that credit facility;
(h) Promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent
to the stockholders of Parent, and copies of all annual, regular, periodic
and special reports and registration statements which Parent may file or be
required to file with the Securities and Exchange Commission under
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, and
not otherwise required to be delivered to the Lenders pursuant to other
provisions of this Section;
(i) Promptly after request by the Managing Agent or any Lender,
copies of the Nevada "Regulation 6.090 Report" and "6-A Report" and copies
of any written communication to Parent or Borrower from any Gaming Board
advising it of a violation of or non-compliance with any Gaming Law by
Parent or Borrower;
(j) Promptly after request by the Managing Agent or any Lender,
copies of any other report or other document (except any such report or
document pertaining solely to personal matters respecting an individual)
that was filed by Borrower or any of its Subsidiaries with any Governmental
Agency;
(k) Promptly upon a Senior Officer of Borrower becoming aware,
and in any event within ten (10) Banking Days after the occurrence of any
(i) "reportable event" (as such term is defined in Section 4043 of ERISA)
or (ii) "prohibited transaction" (as such term is defined in Section 406
of ERISA or Section 4975 of the Code) in connection with any Pension Plan
or any trust created thereunder, telephonic notice specifying the nature
thereof, and, no more than five (5) Banking Days after such telephonic
notice, written notice again specifying the nature thereof and specifying
what action Borrower or any of its Subsidiaries is taking or proposes to
take with respect thereto, and, when known, any action taken by the
Internal Revenue Service with respect thereto;
(l) As soon as practicable, and in any event within
two (2) Banking Days after a Senior Officer of Borrower becomes aware of
the existence of any condition or event which constitutes a Default or
Event of Default, telephonic notice specifying the nature and period of
existence thereof, and, no more than two (2) Banking Days after such
telephonic notice, written notice again specifying the nature and period of
existence thereof and specifying what action Borrower or its Subsidiaries
are taking or propose to take with respect thereto;
(m) Promptly upon a Senior Officer of Borrower becoming aware
that (i) any Person has commenced a legal proceeding with
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respect to a claim against Borrower or any of its Subsidiaries that is
$2,000,000 or more in excess of the amount thereof that is fully covered
by insurance, (ii) any creditor under a credit agreement involving
Indebtedness of $2,000,000 or more or any lessor under a lease involving
aggregate remaining rent of $2,000,000 or more has asserted a default
thereunder on the part of Borrower or any of its Subsidiaries, (iii) any
Person has commenced a legal proceeding with respect to a claim against
Borrower or any of its Subsidiaries under a contract that is not a credit
agreement or material lease in excess of $2,000,000 or which otherwise may
reasonably be expected to result in a Material Adverse Effect, (iv) any
labor union has notified Borrower of its intent to strike Borrower or any
of its Subsidiaries on a date certain and such strike would involve more
than 100 employees of Borrower or its Subsidiaries, or (v) any Gaming Board
has indicated its intent to consider or act upon a License Revocation or a
fine or penalty of $1,000,000 or more with respect to Borrower or any of
its Subsidiaries, a written notice describing the pertinent facts relating
thereto and what action Borrower or its Subsidiaries are taking or propose
to take with respect thereto; and
(n) Such other data and information as from time to time may be
reasonably requested by the Managing Agent, any Lender (through the
Managing Agent) or the Requisite Lenders.
8.2 COMPLIANCE CERTIFICATES. So long as any Advance remains unpaid
or any other Obligation remains unpaid or unperformed, or any portion of the
Commitment remains outstanding, Borrower shall, at Borrower's sole expense,
deliver to the Managing Agent for distribution by it to the Lenders concurrently
with the financial statements required pursuant to Sections 8.1(C) and 8.1(D),
Compliance Certificates signed by a Senior Officer of Borrower.
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Article 9
CONDITIONS
9.1 INITIAL ADVANCES. The obligation of each Lender to make the
initial Advance to be made by it is subject to the following conditions
precedent, each of which shall be satisfied prior to the making of the initial
Advances (unless all of the Lenders, in their sole and absolute discretion,
shall agree otherwise):
(a) The Managing Agent shall have received all of the following,
each of which shall be originals unless otherwise specified, each properly
executed by a Responsible Official of each party thereto, each dated as of
the Closing Date and each in form and substance satisfactory to the
Managing Agent and its legal counsel (unless otherwise specified or, in the
case of the date of any of the following, unless the Managing Agent
otherwise agrees or directs):
(1) at least one (1) executed counterpart of this Agreement,
together with arrangements satisfactory to the Managing Agent for
additional executed counterparts, sufficient in number for
distribution to the Lenders and Borrower;
(2) Notes executed by Borrower in favor of each Lender, each in
a principal amount equal to that Lender's Pro Rata Share of the
Commitment;
(3) the Subsidiary Guaranty executed by each Subsidiary of
Borrower (if any are in existence on the Closing Date);
(4) the Security Agreement executed by Borrower and each
Subsidiary of Borrower (if any are in existence on the Closing Date);
(5) the Collateral Assignment executed by Borrower;
(6) such financing statements on Form UCC-1 executed by Borrower
and each Subsidiary of Borrower (if any are in existence on the
Closing Date) with respect to the Security Agreement and Collateral
Assignment as the Managing Agent may request;
(7) the Pledge Agreement executed by Parent together with the
Pledged Collateral accompanied by appropriate stock powers endorsed in
blank;
(8) such financing statements on Form UCC-1 executed by Parent
with respect to the Pledge Agreement as the Managing Agent may
request;
(9) the Completion Guaranty executed by Parent;
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(10) a copy of the Supplemental Loan Agreement executed by Parent
and Borrower in a form acceptable to the Lenders, together with a
Certificate of a Senior Officer of Borrower that the representations
of Parent therein are true and correct and that all conditions
precedent in Section 3.01 thereof to the obligations of Parent
thereunder have been satisfied;
(11) the Deed of Trust executed by Borrower;
(12) with respect to Parent, Borrower and each Subsidiary of
Borrower (if any are in existence on the Closing Date), such
documentation as the Managing Agent may require to establish the due
organization, valid existence and good standing of Parent, Borrower
and each such Subsidiary, its qualification to engage in business in
each material jurisdiction in which it is engaged in business or
required to be so qualified, its authority to execute, deliver and
perform any Loan Documents to which it is a Party, the identity,
authority and capacity of each Responsible Official thereof authorized
to act on its behalf, INCLUDING (if applicable) certified copies of
articles of incorporation or organization and amendments thereto,
bylaws or operating agreements and amendments thereto, certificates of
good standing and/or qualification to engage in business, tax
clearance certificates, certificates of corporate or other
organizational resolutions, incumbency certificates, Certificates of
Responsible Officials, and the like;
(13) the Opinions of Counsel;
(14) a preliminary written appraisal by a qualified independent
appraiser acceptable to the Managing Agent of the Project Property
that reflects an aggregate fair market value thereof (INCLUDING the
value of the Leased Equipment) on an as-built stabilized basis of not
less than $170,000,000;
(15) assurances from the Title Company that it is prepared to
issue its "LP-10" ALTA construction lenders title policy (or such
other lenders title policy determined by the Managing Agent to be the
equivalent thereof) insuring the Lien of the Deed of Trust in an
amount not less than the fair market value of the Project Property as
determined by the foregoing appraisal (PROVIDED, however, that the
title insurance amount shall not exceed the Commitment), subject only
to such exceptions as are reasonably acceptable to the Managing Agent,
with such title policy endorsements as the Managing Agent may
reasonably require and with such assurances as the Managing Agent may
reasonably require from title re-insurers acceptable to the Managing
Agent, TOGETHER WITH the written commitment of the Title Company to
issue on or before the Completion Date its replacement ALTA title
policy in the same form with such title policy endorsements as the
Managing Agent may reasonably require;
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(16) the Landlord Consent and Agreement executed by the lessors
under the Realty Lease;
(17) a "Phase I" environmental report with respect to the Project
Property prepared by a qualified independent environmental expert
acceptable to the Managing Agent, together with a Certificate of a
Senior Officer of Borrower to the effect that no event or circumstance
has occurred since the date thereof that would cause such report to be
inaccurate in any respect that is materially adverse to the interests
of the Lenders;
(18) a Certificate of insurance issued by Borrower's insurance
carrier or agent with respect to the insurance required to be
maintained pursuant to the Deed of Trust, together with lenders' loss
payable endorsements thereof on Form 438BFU or other form acceptable
to the Managing Agent;
(19) a Certificate of a Senior Officer of Borrower attaching the
Construction Plans, the Construction Budget and the Construction
Timetable, each of which shall be consistent in all material respects
with the representations respecting them previously made to the
Managing Agent and the Lenders;
(20) a letter from CSG stating that it has reviewed the
Construction Plans, the Construction Budget and the Construction
Timetable and believes them to be reasonable and feasible;
(21) a Certificate of a Senior Officer of Borrower attaching a
copy of the Equipment Lease and the Equipment Sublease, which shall be
satisfactory in form and substance to the Lenders;
(22) the Intercreditor Agreement executed by or on behalf of the
Equipment Lessors;
(23) a Certificate of a Senior Officer of Borrower attaching a
copy of the Architect Contracts;
(24) the Architect's Certificate and Consent executed by the
Architect;
(25) a Certificate of a Senior Officer of Borrower attaching a
copy of the Construction Contract;
(26) the Contractor's Certificate and Consent executed by the
Contractor;
(27) [Intentionally Deleted]
(28) a Certificate of a Senior Officer of Parent certifying that
performance of the Completion Guaranty and the
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Supplemental Loan Agreement will not violate any indenture, credit
agreement or other material agreement of Parent;
(29) a Certificate of a Senior Officer of Borrower certifying
that the attached copy of the Management Agreement dated as of
September 21, 1996 between Parent and Borrower is true copy, which
Management Agreement is in form and substance acceptable to the
Managing Agent;
(30) a Certificate of a Senior Officer of Borrower setting forth
all permits which it holds from Governmental Agencies with respect to
construction of the Project, together with a letter from CSG stating
that such permits are those customarily obtained at the then current
stage of construction and that, in its opinion, the remaining permits
will be obtained in due course without adversely affecting the
Construction Timetable;
(31) a Certificate signed by a Senior Officer of Borrower
certifying that the representation contained in Section 4.17 is true
and correct and that the conditions specified in Sections 9.1(h) and
9.1(i) have been satisfied; and
(32) such other assurances, certificates, documents, consents or
opinions as the Managing Agent reasonably may require.
(b) The arrangement fee payable pursuant to Section 3.2 shall
have been paid.
(c) The upfront fees payable pursuant to Section 3.3 shall have
been paid.
(d) Any agency fees payable on the Closing Date pursuant to
Section 3.6 shall have been paid.
(e) Any co-agency fees payable on the Closing Date pursuant to
Section 3.7 shall have been paid.
(f) The reasonable costs and expenses of the Managing Agent in
connection with the preparation of the Loan Documents payable pursuant to
Section 12.3, and invoiced to Borrower prior to the Closing Date, shall
have been paid.
(g) The Managing Agent shall be satisfied that the Collateral
Documents create a first priority Lien in the Collateral (subject only to
Permitted Encumbrances and such other exceptions as may be acceptable to
the Lenders), and that the funds required to terminate the existing Lien on
the Project Property securing an obligation of approximately $6,150,000
have been provided from a source other than a Loan hereunder.
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(h) The representations and warranties of Borrower contained
in ARTICLE 4 shall be true and correct.
(i) Borrower and any other Parties shall be in compliance with
all the terms and provisions of the Loan Documents, and giving effect to
the initial Advance no Default or Event of Default shall have occurred
and be continuing.
(j) All legal matters relating to the Loan Documents shall be
satisfactory to Sheppard, Mullin, Xxxxxxx & Xxxxxxx, special counsel to
the Managing Agent.
(k) The Closing Date shall have occurred on or before
September 30, 1996.
9.2 INITIAL ADVANCES - FURTHER CONDITIONS. The obligation of each
Lender to make the initial Advance to be made by it is subject to the further
conditions to be satisfied prior to the making of the initial Advances (unless
all of the Lenders, in their sole and absolute discretion shall agree otherwise)
that:
(a) the Managing Agent shall have received the final written
appraisal by a qualified independent appraiser acceptable to the Managing
Agent and complying in all respects with FIRREA of the Project Property
and either (i) such appraisal reflects an aggregate fair market value
thereof (INCLUDING the value of the Leased Equipment) on an as-built
stabilized basis of not less than $170,000,000 or (ii) Parent
concurrently makes a Cash Equity Contribution in an amount at least equal
to the amount by which the fair market value set forth in such appraisal
is less than $170,000,000; and
(b) the Managing Agent shall have received a Certificate of a
Senior Officer of Borrower stating that Borrower has received permanent
equity contributions from Parent of not less than $52,000,000.
9.3 ADVANCES - SPECIAL CONDITION. The obligation of each Lender to
make any Advance is subject to the condition precedent (unless the Supermajority
Lenders, in their sole and absolute discretion, shall otherwise agree) that,
giving effect to such Advance, the Lenders will not have funded pursuant to this
Agreement more than fifty-five percent (55%) of the Total Incurred Project Cost
as of such date, and the Managing Agent shall have received a written
certification to that effect from CSG.
9.4 ANY ADVANCE. The obligation of each Lender to make any Advance
is subject to the following conditions precedent (unless the Requisite Lenders,
in their sole and absolute discretion, shall agree otherwise):
(a) EXCEPT (i) for representations and warranties which
expressly speak as of a particular date or are no longer true and correct
as a result of a change which is permitted by this Agreement
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or (ii) as disclosed by Borrower and approved in writing by the Requisite
Lenders, the representations and warranties contained in ARTICLE 4 (OTHER
THAN Sections 4.4(a), 4.6 (first sentence), 4.10, 4.17 and 4.19) shall be
true and correct on and as of the date of the Advance as though made on
that date;
(b) other than matters described in SCHEDULE 4.10 or not
required as of the Closing Date to be therein described, there shall not
be then pending or threatened any action, suit, proceeding or
investigation against or affecting Borrower or any of its Subsidiaries or
any Property of any of them before any Governmental Agency that
constitutes a Material Adverse Effect;
(c) the Managing Agent shall have timely received a Request
for Loan in compliance with ARTICLE 2 (or telephonic or other request for
Loan referred to in the second sentence of Section 2.1(b), if
applicable); and
(d) the Managing Agent shall have received, in form and
substance satisfactory to the Managing Agent, such other assurances,
certificates, documents or consents related to the foregoing as the
Managing Agent or Requisite Lenders reasonably may require.
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Article 10
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
10.1 EVENTS OF DEFAULT. The existence or occurrence of any one or
more of the following events, whatever the reason therefor and under any
circumstances whatsoever, shall constitute an Event of Default:
(a) Borrower fails to pay any principal on any of the Notes,
or any portion thereof, on the date when due; or
(b) Borrower fails to pay any interest on any of the Notes, or
any fees under Sections 3.4, 3.5 or 3.6, or any portion thereof, within
two (2) Banking Days after the date when due; or fails to pay any other
fee or amount payable to the Lenders under any Loan Document, or any
portion thereof, within two (2) Banking Days after demand therefor; or
(c) Borrower fails to comply with any of the covenants
contained in Sections 5.1, 5.4, 5.6, 5.13 or ARTICLE 6; or
(d) Borrower fails to comply with Section 8.1(l) in any
respect that is materially adverse to the interests of the Lenders; or
(e) Borrower, any of its Subsidiaries or any other Party fails
to perform or observe any other covenant or agreement (not specified in
clause (a), (b), (c) or (d) above) contained in any Loan Document on its
part to be performed or observed within ten (10) Banking Days after the
giving of notice by the Managing Agent on behalf of the Requisite Lenders
of such Default; or
(f) Any representation or warranty of Borrower or any of its
Subsidiaries or any other Party made in any Loan Document, or in any
certificate or other writing delivered by Borrower or such Subsidiary or
Party pursuant to any Loan Document, proves to have been incorrect when
made or reaffirmed in any respect that is materially adverse to the
interests of the Lenders; or
(g) Borrower or any of its Subsidiaries (i) fails to pay the
principal, or any principal installment, of any present or future
Indebtedness of $2,000,000 or more, or any guaranty of present or future
Indebtedness of $2,000,000 or more, on its part to be paid, when due (or
within any stated grace period), whether at the stated maturity, upon
acceleration, by reason of required prepayment or otherwise or (ii) fails
to perform or observe any other term, covenant or agreement on its part
to be performed or observed, or suffers any event of default to occur, in
connection with any present or future Indebtedness of $2,000,000 or more,
or of any guaranty of present or future Indebtedness of $2,000,000 or
more, if as a result of such failure or sufferance any holder or holders
thereof (or an agent or trustee on its or their behalf) has the right to
declare such Indebtedness due before the date on which it otherwise would
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become due or the right to require Borrower or any of its Subsidiaries to
redeem or purchase, or offer to redeem or purchase, all or any portion of
such Indebtedness (provided, that for the purposes of this clause (g),
the principal amount of Indebtedness consisting of a Swap Agreement shall
be the amount which is then payable by the counterparty to close out the
Swap Agreement); or
(h) The occurrence of an Event of Default (as such term is
defined under the Parent Bank Credit Facility) under the Parent Bank
Credit Facility; or
(i) Any event occurs which gives the holder or holders of any
Subordinated Obligation of $2,000,000 or more (or an agent or trustee on
its or their behalf) the right to declare such Subordinated Obligation
due before the date on which it otherwise would become due, or the right
to require the issuer thereof to redeem or purchase, or offer to redeem
or purchase, all or any portion of any such Subordinated Obligation; or
the trustee for, or any holder of, a Subordinated Obligation breaches any
subordination provision applicable to such Subordinated Obligation; or
(j) Any Loan Document, at any time after its execution and
delivery and for any reason OTHER THAN the agreement or action (or
omission to act) of the Managing Agent or any of the Lenders or
satisfaction in full of all the Obligations ceases to be in full force
and effect or is declared by a court of competent jurisdiction to be null
and void, invalid or unenforceable in any respect which is materially
adverse to the interests of the Lenders; or any Collateral Document
ceases (other than by action or inaction of the Managing Agent or any
Lender) to create a valid and effective Lien in any material Collateral
covered thereby; or any Party thereto denies in writing that it has any
or further liability or obligation under any Loan Document in accordance
with its terms, or purports to revoke, terminate or rescind same; or
Parent denies in writing that it has any or further liability or
obligation under the Supplemental Loan Agreement in accordance with its
terms, or purports to revoke, terminate or rescind same; or
(k) A final judgment against Borrower or any of its
Subsidiaries is entered for the payment of money in excess of $2,000,000
(not covered by insurance or for which an insurer has reserved its
rights) and, absent procurement of a stay of execution, such judgment
remains unsatisfied for thirty (30) calendar days after the date of entry
of judgment, or in any event later than five (5) days prior to the date
of any proposed sale thereunder; or any writ or warrant of attachment or
execution or similar process is issued or levied against all or any
material part of the Property of any such Person and is not released,
vacated or fully bonded within thirty (30) calendar days after its issue
or levy; or
(l) Borrower or any of its Subsidiaries institutes or consents
to the institution of any proceeding under a Debtor Relief Law relating
to it or to all or any material part of its Property, or
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is unable or admits in writing its inability to pay its debts as they
mature, or makes an assignment for the benefit of creditors; or
applies for or consents to the appointment of any receiver, trustee,
custodian, conservator, liquidator, rehabilitator or similar officer
for it or for all or any material part of its Property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator
or similar officer is appointed without the application or consent of
that Person and the appointment continues undischarged or unstayed for
sixty (60) calendar days; or any proceeding under a Debtor Relief Law
relating to any such Person or to all or any part of its Property is
instituted without the consent of that Person and continues
undismissed or unstayed for sixty (60) calendar days; or
(m) The occurrence of an Event of Default (as such term is or
may hereafter be specifically defined in any other Loan Document) under
any other Loan Document; or
(n) A final judgment is entered by a court of competent
jurisdiction that any Subordinated Obligation is not subordinated in
accordance with its terms to the Obligations; or
(o) The occurrence of an Event of Default (as such term or
analogous term is or may hereafter be specifically defined in the
Equipment Lease or Equipment Sublease) under the Equipment Lease or
Equipment Sublease, or the occurrence of any event of default (after the
expiration of all grace or notice periods) under any other operating
lease covering Property valued at $2,000,000 or more to which Borrower is
a party as lessee or sublessee; or
(p) The occurrence of a Default (as such term or analogous
term is or may hereafter be specifically defined under the Realty Lease)
under the Realty Lease; or
(q) During the period ending on the date that is six (6)
months after the Completion Date, (i) the Equipment Lease and the Parent
Bank Credit Facility both cease to be in effect, and (ii) Parent fails to
be in compliance with the covenants contained in Sections 9.11 or 9.12 of
the Parent Bank Credit Facility as such covenants existed as of the date
the Parent Bank Credit Facility ceased to be in effect; or
(r) Any Pension Plan maintained by Borrower or any of its
ERISA Affiliates is determined to have a material "accumulated funding
deficiency" as that term is defined in Section 302 of ERISA and the
result is a Material Adverse Effect; or
(s) The occurrence of a Change of Ownership or a Parent Change
of Control; or
(t) The failure of the Completion Date to occur prior to
December 31, 1997; or
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(u) The occurrence of a License Revocation that continues for
three (3) consecutive calendar days.
10.2 REMEDIES UPON EVENT OF DEFAULT. Without limiting any other
rights or remedies of the Managing Agent or the Lenders provided for elsewhere
in this Agreement, or the other Loan Documents, or by applicable Law, or in
equity, or otherwise:
(a) Upon the occurrence, and during the continuance, of any Event
of Default OTHER THAN an Event of Default described in Section 10.1(l):
(1) the Commitment to make Advances and all other obligations
of the Managing Agent or the Lenders and all rights of Borrower and
any other Parties under the Loan Documents shall be suspended
without notice to or demand upon Borrower, which are expressly
waived by Borrower, EXCEPT that all of the Lenders or the Requisite
Lenders (as the case may be, in accordance with Section 12.2) may
waive an Event of Default or, without waiving, determine, upon terms
and conditions satisfactory to the Lenders or Requisite Lenders, as
the case may be, to reinstate the Commitment and such other
obligations and rights and make further Advances, which waiver or
determination shall apply equally to, and shall be binding upon, all
the Lenders;
(2) the Requisite Lenders may request the Managing Agent to,
and the Managing Agent thereupon shall, terminate the Commitment
and/or declare all or any part of the unpaid principal of all Notes,
all interest accrued and unpaid thereon and all other amounts
payable under the Loan Documents to be forthwith due and payable,
whereupon the same shall become and be forthwith due and payable,
without protest, presentment, notice of dishonor, demand or further
notice of any kind, all of which are expressly waived by Borrower.
(b) Upon the occurrence, and during the continuance, of any
Event of Default described in Section 10.1(l):
(1) the Commitment to make Advances and all other obligations
of the Managing Agent or the Lenders and all rights of Borrower and
any other Parties under the Loan Documents shall terminate without
notice to or demand upon Borrower, which are expressly waived by
Borrower, EXCEPT that all of the Lenders may waive the Event of
Default or, without waiving, determine, upon terms and conditions
satisfactory to all the Lenders, to reinstate the Commitment and
such other obligations and rights and make further Advances which
determination shall apply equally to, and shall be binding upon, all
the Lenders; and
(2) the unpaid principal of all Notes, all interest accrued
and unpaid thereon and all other amounts payable under
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the Loan Documents shall be forthwith due and payable, without
protest, presentment, notice of dishonor, demand or further notice
of any kind, all of which are expressly waived by Borrower.
(c) Upon the occurrence, and during the continuance, of any
Event of Default, the Lenders and the Managing Agent, without notice to
(EXCEPT as expressly provided for in any Loan Document) or demand upon
Borrower, which are expressly waived by Borrower (EXCEPT as to notices
expressly provided for in any Loan Document), may proceed (but only with
the consent of the Requisite Lenders) to protect, exercise and enforce
their rights and remedies under the Loan Documents against Borrower and
any other Party and such other rights and remedies as are provided by Law
or equity.
(d) In addition to any other rights and remedies, if an Event
of Default occurs prior to the Completion Date, the Managing Agent and
the Lenders shall have the right to (i) obtain the appointment of a
receiver to take possession of the Project (and Borrower agrees not to
contest the appointment of such receiver except in good faith) and
(ii) take such steps as the Managing Agent and the Lenders reasonably
deem necessary or appropriate to complete construction of the Project,
INCLUDING making any changes to the Construction Plans, Construction
Budget or Construction Timetable and/or terminating or amending any of
the Architect Contracts, Construction Contracts or any other contract or
arrangement related to the Project; PROVIDED, however, that the Managing
Agent shall be responsible for any breach of contract resulting from any
such change, termination or amendment. Any such action shall not be
construed as an assumption of responsibility by the Managing Agent or the
Lenders to complete the Project, and such steps may be discontinued at
any time. Any such action shall not be construed to make the Managing
Agent or the Lenders a partner or joint venturer with Borrower. All
amounts expended by the Managing Agent and the Lenders for the completion
of the Project shall be deemed additional Advances and shall be secured
by the Collateral Documents.
(e) The order and manner in which the Lenders' rights and
remedies are to be exercised shall be determined by the Requisite Lenders
in their sole discretion, and all payments received by the Managing Agent
and the Lenders, or any of them, shall be applied first to the costs and
expenses (including reasonable attorneys' fees and disbursements and the
reasonably allocated costs of attorneys employed by the Managing Agent or
by any Lender) of the Managing Agent and of the Lenders, and thereafter
paid pro rata to the Lenders in the same proportions that the aggregate
Obligations owed to each Lender under the Loan Documents bear to the
aggregate Obligations owed under the Loan Documents to all the Lenders,
without priority or preference among the Lenders. Regardless of how each
Lender may treat payments for the purpose of its own accounting, for the
purpose of computing Borrower' Obligations hereunder and under the Notes,
payments shall be applied FIRST, to the costs and expenses of the
Managing Agent and the Lenders, as set forth above, SECOND, to the
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payment of accrued and unpaid interest due under any Loan Documents to
and including the date of such application (ratably, and without
duplication, according to the accrued and unpaid interest due under each
of the Loan Documents), and THIRD, to the payment of all other amounts
(including principal and fees) then owing to the Managing Agent or the
Lenders under the Loan Documents. Amounts due to a Lender under a
Secured Swap Agreement shall be considered a principal amount for
purposes of the preceding sentence. No application of payments will cure
any Event of Default, or prevent acceleration, or continued acceleration,
of amounts payable under the Loan Documents, or prevent the exercise, or
continued exercise, of rights or remedies of the Lenders hereunder or
thereunder or at Law or in equity.
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Article 11
THE MANAGING AGENT
11.1 APPOINTMENT AND AUTHORIZATION. Subject to Section 11.8, each
Lender hereby irrevocably appoints and authorizes the Managing Agent to take
such action as agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Managing Agent by the terms thereof or are
reasonably incidental, as determined by the Managing Agent, thereto. This
appointment and authorization is intended solely for the purpose of facilitating
the servicing of the Loans and does not constitute appointment of the Managing
Agent as trustee for any Lender or as representative of any Lender for any other
purpose and, EXCEPT as specifically set forth in the Loan Documents to the
contrary, the Managing Agent shall take such action and exercise such powers
only in an administrative and ministerial capacity.
11.2 MANAGING AGENT AND AFFILIATES. Bank of America National Trust
and Savings Association (and each successor Managing Agent) has the same rights
and powers under the Loan Documents as any other Lender and may exercise the
same as though it were not the Managing Agent, and the term "Lender" or
"Lenders" includes Bank of America National Trust and Savings Association in its
individual capacity. Bank of America National Trust and Savings Association
(and each successor Managing Agent) and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of banking, trust or other
business with Borrower, any Subsidiary thereof, or any Affiliate of Borrower or
any Subsidiary thereof, as if it were not the Managing Agent and without any
duty to account therefor to the Lenders. Bank of America National Trust and
Savings Association (and each successor Managing Agent) need not account to any
other Lender for any monies received by it for reimbursement of its costs and
expenses as Managing Agent hereunder, or for any monies received by it in its
capacity as a Lender hereunder. The Managing Agent shall not be deemed to hold
a fiduciary relationship with any Lender and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Managing Agent.
11.3 PROPORTIONATE INTEREST IN ANY COLLATERAL. The Managing Agent,
on behalf of all the Lenders, shall hold in accordance with the Loan Documents
all items of any collateral or interests therein received or held by the
Managing Agent. Subject to the Managing Agent's and the Lenders' rights to
reimbursement for their costs and expenses hereunder (INCLUDING reasonable
attorneys' fees and disbursements and other professional services and the
reasonably allocated costs of attorneys employed by the Managing Agent or a
Lender) and subject to the application of payments in accordance with Section
10.2(D), each Lender shall have an interest in the Lenders' interest in the
Collateral or interests therein in the same proportions that the aggregate
Obligations owed such Lender under the Loan Documents bear to the aggregate
Obligations owed under the Loan Documents to all the Lenders, without priority
or preference among the Lenders, EXCEPT that Obligations owed to any Lender (or
Affiliate of a Lender) under a Secured Swap Agreement shall be secured on a PARI
passu basis with all other Obligations up to an amount equal to the Managing
Agent's then
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customary credit risk factor for Swap Agreements times the notional amount
of Indebtedness covered by such Secured Swap Agreement and shall be secured
on a subordinate basis as to amounts in excess of such amount.
11.4 LENDERS' CREDIT DECISIONS. Each Lender agrees that it has,
independently and without reliance upon the Managing Agent, any other Lender or
the directors, officers, agents, employees or attorneys of the Managing Agent or
of any other Lender, and instead in reliance upon information supplied to it by
or on behalf of Borrower and upon such other information as it has deemed
appropriate, made its own independent credit analysis and decision to enter into
this Agreement. Each Lender also agrees that it shall, independently and
without reliance upon the Managing Agent, any other Lender or the directors,
officers, agents, employees or attorneys of the Managing Agent or of any other
Lender, continue to make its own independent credit analyses and decisions in
acting or not acting under the Loan Documents.
11.5 ACTION BY MANAGING AGENT.
(a) Absent actual knowledge of the Managing Agent of the
existence of a Default, the Managing Agent may assume that no Default has
occurred and is continuing, unless the Managing Agent (or the Lender that
is then the Managing Agent) has received notice from Borrower stating the
nature of the Default or has received notice from a Lender stating the
nature of the Default and that such Lender considers the Default to have
occurred and to be continuing.
(b) The Managing Agent has only those obligations under the
Loan Documents as are expressly set forth therein.
(c) EXCEPT for any obligation expressly set forth in the Loan
Documents and as long as the Managing Agent may assume that no Event of
Default has occurred and is continuing, the Managing Agent may, but shall
not be required to, exercise its discretion to act or not act, EXCEPT
that the Managing Agent shall be required to act or not act upon the
instructions of the Requisite Lenders (or of all the Lenders, to the
extent required by Section 12.2) and those instructions shall be binding
upon the Managing Agent and all the Lenders, PROVIDED that the Managing
Agent shall not be required to act or not act if to do so would be
contrary to any Loan Document or to applicable Law or would result, in
the reasonable judgment of the Managing Agent, in substantial risk of
liability to the Managing Agent.
(d) If the Managing Agent has received a notice specified in
clause (A), the Managing Agent shall immediately give notice thereof to
the Lenders and shall act or not act upon the instructions of the
Requisite Lenders (or of all the Lenders, to the extent required by
Section 12.2), PROVIDED that the Managing Agent shall not be required to
act or not act if to do so would be contrary to any Loan Document or to
applicable Law or would result, in the reasonable judgment of the
Managing Agent, in substantial risk of liability to the Managing Agent,
and EXCEPT that if the Requisite
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Lenders (or all the Lenders, if required under Section 12.2) fail, for
five (5) Banking Days after the receipt of notice from the Managing
Agent, to instruct the Managing Agent, then the Managing Agent, in its
sole discretion, may act or not act as it deems advisable for the
protection of the interests of the Lenders.
(e) The Managing Agent shall have no liability to any Lender
for acting, or not acting, as instructed by the Requisite Lenders (or all
the Lenders, if required under Section 12.2), notwithstanding any other
provision hereof.
11.6 LIABILITY OF MANAGING AGENT. Neither the Managing Agent nor
any of its directors, officers, agents, employees or attorneys shall be liable
for any action taken or not taken by them under or in connection with the Loan
Documents, EXCEPT for their own gross negligence or willful misconduct. Without
limitation on the foregoing, the Managing Agent and its directors, officers,
agents, employees and attorneys:
(a) May treat the payee of any Note as the holder thereof
until the Managing Agent receives notice of the assignment or transfer
thereof, in form satisfactory to the Managing Agent, signed by the payee,
and may treat each Lender as the owner of that Lender's interest in the
Obligations for all purposes of this Agreement until the Managing Agent
receives notice of the assignment or transfer thereof, in form
satisfactory to the Managing Agent, signed by that Lender;
(b) May consult with legal counsel (INCLUDING in-house legal
counsel), accountants (INCLUDING in-house accountants) and other
professionals or experts selected by it, or with legal counsel,
accountants or other professionals or experts for Borrower and/or their
Subsidiaries or the Lenders, and shall not be liable for any action taken
or not taken by it in good faith in accordance with any advice of such
legal counsel, accountants or other professionals or experts;
(c) Shall not be responsible to any Lender for any statement,
warranty or representation made in any of the Loan Documents or in any
notice, certificate, report, request or other statement (written or oral)
given or made in connection with any of the Loan Documents;
(d) EXCEPT to the extent expressly set forth in the Loan
Documents, shall have no duty to ask or inquire as to the performance or
observance by Borrower or its Subsidiaries of any of the terms,
conditions or covenants of any of the Loan Documents or to inspect any
Collateral or the Property, books or records of Borrower or their
Subsidiaries;
(e) Will not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness,
effectiveness, sufficiency or value of any Loan Document, any other
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instrument or writing furnished pursuant thereto or in connection
therewith, or any Collateral;
(f) Will not incur any liability by acting or not acting in
reliance upon any Loan Document, notice, consent, certificate, statement,
request or other instrument or writing believed in good faith by it to be
genuine and signed or sent by the proper party or parties; and
(g) Will not incur any liability for any arithmetical error in
computing any amount paid or payable by the Borrower or any Subsidiary or
Affiliate thereof or paid or payable to or received or receivable from
any Lender under any Loan Document, INCLUDING, principal, interest,
commitment fees, Advances and other amounts; PROVIDED that, promptly upon
discovery of such an error in computation, the Managing Agent, the
Lenders and (to the extent applicable) Borrower and/or its Subsidiaries
or Affiliates shall make such adjustments as are necessary to correct
such error and to restore the parties to the position that they would
have occupied had the error not occurred.
11.7 INDEMNIFICATION. Each Lender shall, ratably in accordance
with its Pro Rata Share of the Commitment (if the Commitment is then in effect)
or in accordance with its proportion of the aggregate Indebtedness then
evidenced by the Notes (if the Commitment has then been terminated), indemnify
and hold the Managing Agent and its directors, officers, agents, employees and
attorneys harmless against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (INCLUDING reasonable attorneys' fees and
disbursements and allocated costs of attorneys employed by the Managing Agent)
that may be imposed on, incurred by or asserted against it or them in any way
relating to or arising out of the Loan Documents (other than losses incurred by
reason of the failure of Borrower to pay the Indebtedness represented by the
Notes) or any action taken or not taken by it as Managing Agent thereunder,
EXCEPT such as result from its own gross negligence or willful misconduct.
Without limitation on the foregoing, each Lender shall reimburse the Managing
Agent upon demand for that Lender's Pro Rata Share of any out-of-pocket cost or
expense incurred by the Managing Agent in connection with the negotiation,
preparation, execution, delivery, amendment, waiver, restructuring,
reorganization (INCLUDING a bankruptcy reorganization), enforcement or attempted
enforcement of the Loan Documents, to the extent that Borrower or any other
Party is required by Section 12.3 to pay that cost or expense but fails to do so
upon demand. Nothing in this Section 11.7 shall entitle the Managing Agent or
any indemnitee referred to above to recover any amount from the Lenders if and
to the extent that such amount has theretofore been recovered from Borrower or
any other Party. To the extent that the Managing Agent or any indemnitee
referred to above is later reimbursed such cost or expense by Borrower or any
other Party, it shall return the amounts paid to it by the Lenders in respect of
such cost or expense.
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11.8 SUCCESSOR MANAGING AGENT. The Managing Agent may, and at the
request of the Requisite Lenders shall, resign as Managing Agent upon reasonable
notice to the Lenders and Borrower effective upon acceptance of appointment by a
successor Managing Agent. If the Managing Agent shall resign as Managing Agent
under this Agreement, the Requisite Lenders shall appoint from among the Lenders
a successor Managing Agent for the Lenders, which successor Managing Agent shall
be approved by Borrower (and such approval shall not be unreasonably withheld or
delayed). If no successor Managing Agent is appointed prior to the effective
date of the resignation of the Managing Agent, the Managing Agent may appoint,
after consulting with the Lenders and the Borrower, a successor Managing Agent
from among the Lenders. Upon the acceptance of its appointment as successor
Managing Agent hereunder, such successor Managing Agent shall succeed to all the
rights, powers and duties of the retiring Managing Agent and the term "Managing
Agent" shall mean such successor Managing Agent and the retiring Managing
Agent's appointment, powers and duties as Managing Agent shall be terminated.
After any retiring Managing Agent's resignation hereunder as Managing Agent, the
provisions of this ARTICLE 11, and Sections 12.3, 12.11 and 12.22, shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Managing Agent under this Agreement. If (a) the Managing Agent has not been
paid its agency fees under Section 3.6 or has not been reimbursed for any
expense reimbursable to it under Section 12.3, in either case for a period of at
least one (1) year and (b) no successor Managing Agent has accepted appointment
as Managing Agent by the date which is thirty (30) days following a retiring
Managing Agent's notice of resignation, the retiring Managing Agent's
resignation shall nevertheless thereupon become effective and the Lenders shall
perform all of the duties of the Managing Agent hereunder until such time, if
any, as the Requisite Lenders appoint a successor Managing Agent as provided for
above.
11.9 FORECLOSURE ON COLLATERAL. In the event of foreclosure or
enforcement of the Lien created by any of the Collateral Documents, title to the
Collateral covered thereby shall be taken and held by the Managing Agent (or an
Affiliate or designee thereof) pro rata for the benefit of the Lenders in
accordance with the Obligations outstanding to each of them.
11.10 NO OBLIGATIONS OF BORROWER. Nothing contained in this
Article 11 shall be deemed to impose upon Borrower any obligation in respect of
the due and punctual performance by the Managing Agent of its obligations to the
Lenders under any provision of this Agreement, and Borrower shall have no
liability to the Managing Agent or any of the Lenders in respect of any failure
by the Managing Agent or any Lender to perform any of its obligations to the
Managing Agent or the Lenders under this Agreement. Without limiting the
generality of the foregoing, where any provision of this Agreement relating to
the payment of any amounts due and owing under the Loan Documents provides that
such payments shall be made by Borrower to the Managing Agent for the account of
the Lenders, Borrower's obligations to the Lenders in respect of such payments
shall be deemed to be satisfied upon the making of such payments to the Managing
Agent in the manner provided by this Agreement.
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Article 12
MISCELLANEOUS
12.1 CUMULATIVE REMEDIES; NO WAIVER. The rights, powers,
privileges and remedies of the Managing Agent and the Lenders provided herein or
in any Note or other Loan Document are cumulative and not exclusive of any
right, power, privilege or remedy provided by Law or equity. No failure or
delay on the part of the Managing Agent or any Lender in exercising any right,
power, privilege or remedy may be, or may be deemed to be, a waiver thereof; nor
may any single or partial exercise of any right, power, privilege or remedy
preclude any other or further exercise of the same or any other right, power,
privilege or remedy. The terms and conditions of ARTICLE 9 hereof are inserted
for the sole benefit of the Managing Agent and the Lenders; the same may be
waived in whole or in part, with or without terms or conditions, in respect of
any Loan without prejudicing the Managing Agent's or the Lenders' rights to
assert them in whole or in part in respect of any other Loan.
12.2 AMENDMENTS; CONSENTS. EXCEPT as set forth in the last
sentence of this Section 12.2, no amendment, modification, supplement,
extension, termination or waiver of any provision of this Agreement or any other
Loan Document, no approval or consent thereunder, and no consent to any
departure by the Borrower or any other Party therefrom, may in any event be
effective unless in writing signed by the Managing Agent with the approval of
Requisite Lenders (and, in the case of any amendment, modification or supplement
of or to any Loan Document to which any of the Borrower or any of its
Subsidiaries is a Party, signed by each such Party, and, in the case of any
amendment, modification or supplement to ARTICLE 11, signed by the Managing
Agent), and then only in the specific instance and for the specific purpose
given; and, without the approval in writing of the Supermajority Lenders, no
amendment, modification, supplement, termination, waiver or consent may be
effective with respect to Sections 6.20, 6.21 and 9.2; and, without the approval
in writing of all the Lenders, no amendment, modification, supplement,
termination, waiver or consent may be effective:
(a) To amend or modify the principal of, or the amount of
principal, principal prepayments or the rate of interest payable on, any
Note, or the amount of the Commitment or the Pro Rata Share of any Lender
or the amount of any commitment fee payable to any Lender, or any other
fee or amount payable to any Lender under the Loan Documents or to waive
an Event of Default consisting of the failure of Borrower to pay when due
principal, interest or any commitment fee;
(b) To postpone any date fixed for any payment of principal
of, prepayment of principal of or any installment of interest on, any
Note or any installment of any commitment fee, or to extend the term of
the Commitment;
(c) To release the Subsidiary Guaranty or the Completion
Guaranty or any material portion of the Collateral, EXCEPT
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(i) in the case of the Pledged Collateral, release thereof to the
extent ordered by any Gaming Board, (ii) in the case of a Disposition
permitted by Sections 6.2(A) or 6.2(b), releases of the Collateral
therein described and (iii) in any other case, as otherwise may be
expressly provided for in any Loan Document;
(d) To amend the provisions of the definition of "AMORTIZATION
AMOUNT", "AMORTIZATION DATE", "REQUISITE LENDERS", "MATURITY DATE" or
"SUPERMAJORITY LENDERS";
(e) To amend or waive ARTICLE 9, Sections 5.13, 6.4, or this
Section 12.2; or
(f) To amend any provision of this Agreement that expressly
requires the consent or approval of all the Lenders.
Any amendment, modification, supplement, termination, waiver or consent pursuant
to this Section 12.2 shall apply equally to, and shall be binding upon, all the
Lenders and the Managing Agent. Notwithstanding the foregoing, the Managing
Agent may execute such amendments to the Pledge Agreement as may be required by
a Gaming Board referred to in Section 5.12 and are acceptable to the Managing
Agent.
12.3 COSTS, EXPENSES AND TAXES. Borrower shall pay within five (5)
Banking Days after demand, accompanied by an invoice therefor, the reasonable
costs and expenses of the Managing Agent in connection with the negotiation,
preparation, syndication, execution and delivery of the Loan Documents and any
amendment thereto or waiver thereof. Borrower shall also pay on demand,
accompanied by an invoice therefor, the reasonable costs and expenses of the
Managing Agent and the Lenders in connection with the refinancing,
restructuring, reorganization (INCLUDING a bankruptcy reorganization) and
enforcement or attempted enforcement of the Loan Documents, and any matter
related thereto. The foregoing costs and expenses shall include filing fees,
recording fees, title insurance fees, appraisal fees, search fees, and other
out-of-pocket expenses and the reasonable fees and out-of-pocket expenses of any
legal counsel (INCLUDING reasonably allocated costs of legal counsel employed by
the Managing Agent or any Lender), independent public accountants and other
outside experts retained by the Managing Agent or any Lender, whether or not
such costs and expenses are incurred or suffered by the Managing Agent or any
Lender in connection with or during the course of any bankruptcy or insolvency
proceedings of Borrower or any Subsidiary thereof. Such costs and expenses
shall also include, in the case of any amendment or waiver of any Loan Document
requested by Borrower, the administrative costs of the Managing Agent reasonably
attributable thereto. Borrower shall pay any and all documentary and other
taxes, EXCLUDING (i) taxes imposed on or measured in whole or in part by its
overall net income by (A) any jurisdiction (or political subdivision thereof) in
which it is organized or maintains its principal office or Eurodollar Lending
Office or (B) any jurisdiction (or political subdivision thereof) in which it is
"doing business" or (ii) any withholding taxes or other taxes based on gross
income imposed by the United States of America for any period with respect to
which it has failed to provide Borrower with the appropriate form or forms
required by
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Section 12.21, to the extent such forms are then required by applicable Laws,
and all costs, expenses, fees and charges payable or determined to be payable
in connection with the filing or recording of this Agreement, any other Loan
Document or any other instrument or writing to be delivered hereunder or
thereunder, or in connection with any transaction pursuant hereto or thereto,
and shall reimburse, hold harmless and indemnify on the terms set forth in
12.11 the Managing Agent and the Lenders from and against any and all loss,
liability or legal or other expense with respect to or resulting from any
delay in paying or failure to pay any such tax, cost, expense, fee or charge
or that any of them may suffer or incur by reason of the failure of any Party
to perform any of its Obligations. Any amount payable to the Managing Agent
or any Lender under this Section shall bear interest from the second Banking
Day following the date of demand for payment at the Default Rate.
12.4 NATURE OF LENDERS' OBLIGATIONS. The obligations of the
Lenders hereunder are several and not joint or joint and several. Nothing
contained in this Agreement or any other Loan Document and no action taken by
the Managing Agent or the Lenders or any of them pursuant hereto or thereto may,
or may be deemed to, make the Lenders a partnership, an association, a joint
venture or other entity, either among themselves or with the Borrower or any
Affiliate of any of Borrower. Each Lender's obligation to make any Advance
pursuant hereto is several and not joint or joint and several, and in the case
of the initial Advance only is conditioned upon the performance by all other
Lenders of their obligations to make initial Advances. A default by any Lender
will not increase the Pro Rata Share of the Commitment attributable to any other
Lender. Any Lender not in default may, if it desires, assume in such proportion
as the nondefaulting Lenders agree the obligations of any Lender in default, but
is not obligated to do so. The Managing Agent agrees that it will use its best
efforts either to induce the other Lenders to assume the obligations of a Lender
in default or to obtain another Lender, reasonably satisfactory to Borrower, to
replace such a Lender in default.
12.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein or in any other Loan Document,
or in any certificate or other writing delivered by or on behalf of any one or
more of the Parties to any Loan Document, will survive the making of the Loans
hereunder and the execution and delivery of the Notes, and have been or will be
relied upon by the Managing Agent and each Lender, notwithstanding any
investigation made by the Managing Agent or any Lender or on their behalf.
12.6 NOTICES. EXCEPT as otherwise expressly provided in the Loan
Documents, all notices, requests, demands, directions and other communications
provided for hereunder or under any other Loan Document must be in writing and
must be mailed, telegraphed, telecopied, dispatched by commercial courier or
delivered to the appropriate party at the address set forth on the signature
pages of this Agreement or other applicable Loan Document or, as to any party to
any Loan Document, at any other address as may be designated by it in a written
notice sent to all other parties to such Loan Document in accordance with this
Section. EXCEPT as otherwise expressly provided in any Loan Document, if any
notice, request, demand,
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direction or other communication required or permitted by any Loan Document
is given by mail it will be effective on the earlier of receipt or the fourth
Banking Day after deposit in the United States mail with first class or
airmail postage prepaid; if given by telegraph or cable, when delivered to
the telegraph company with charges prepaid; if given by telecopier, when
sent; if dispatched by commercial courier, on the scheduled delivery date; or
if given by personal delivery, when delivered.
12.7 EXECUTION OF LOAN DOCUMENTS. Unless the Managing Agent
otherwise specifies with respect to any Loan Document, (a) this Agreement and
any other Loan Document may be executed in any number of counterparts and any
party hereto or thereto may execute any counterpart, each of which when executed
and delivered will be deemed to be an original and all of which counterparts of
this Agreement or any other Loan Document, as the case may be, when taken
together will be deemed to be but one and the same instrument and (b) execution
of any such counterpart may be evidenced by a telecopier transmission of the
signature of such party. The execution of this Agreement or any other Loan
Document by any party hereto or thereto will not become effective until
counterparts hereof or thereof, as the case may be, have been executed by all
the parties hereto or thereto.
12.8 BINDING EFFECT; ASSIGNMENT.
(a) This Agreement and the other Loan Documents to which
Borrower are a Party will be binding upon and inure to the benefit of
Borrower, the Managing Agent, each of the Lenders, and their respective
successors and assigns, EXCEPT that Borrower may not assign its rights
hereunder or thereunder or any interest herein or therein without the
prior written consent of all the Lenders. Each Lender represents that it
is not acquiring its Note with a view to the distribution thereof within
the meaning of the Securities Act of 1933, as amended (subject to any
requirement that disposition of such Note must be within the control of
such Lender). Any Lender may at any time pledge its Note or any other
instrument evidencing its rights as a Lender under this Agreement to a
Federal Reserve Bank, but no such pledge shall release that Lender from
its obligations hereunder or grant to such Federal Reserve Bank the
rights of a Lender hereunder absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Lender
may assign to one or more Eligible Assignees all or any portion of its
Pro Rata Share of the Commitment; PROVIDED that (i) with respect to an
assignment made prior to the Availability Termination Date such Eligible
Assignee, if not then a Lender or an Affiliate of the assigning Lender,
shall be approved by each of the Managing Agent and (if no Event of
Default then exists) Borrower (neither of which approvals shall be
unreasonably withheld or delayed), (ii) such assignment shall be
evidenced by a Commitment Assignment and Acceptance, a copy of which
shall be furnished to the Managing Agent as hereinbelow provided,
(iii) EXCEPT in the case of an assignment to an Affiliate of the
assigning Lender, to another Lender or of the entire remaining Commitment
of the assigning Lender, the assignment shall not assign a Pro Rata Share
of the Commitment
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that is equivalent to less than $5,000,000, and (iv) the effective
date of any such assignment shall be as specified in the Commitment
Assignment and Acceptance, but not earlier than the date which is five
(5) Banking Days after the date the Managing Agent has received the
Commitment Assignment and Acceptance. Upon the effective date of such
Commitment Assignment and Acceptance, the Eligible Assignee named
therein shall be a Lender for all purposes of this Agreement, with the
Pro Rata Share of the Commitment therein set forth and, to the extent
of such Pro Rata Share, the assigning Lender shall be released from
its further obligations under this Agreement. Borrower agrees that it
shall execute and deliver (against delivery by the assigning Lender to
Borrower of its Note) to such assignee Lender, a Note evidencing that
assignee Lender's Pro Rata Share of the Commitment, and to the
assigning Lender, a Note evidencing the remaining balance of the Pro
Rata Share retained by the assigning Lender.
(c) By executing and delivering a Commitment Assignment and
Acceptance, the Eligible Assignee thereunder acknowledges and agrees
that: (i) other than the representation and warranty that it is the legal
and beneficial owner of the Pro Rata Share of the Commitment being
assigned thereby free and clear of any adverse claim, the assigning
Lender has made no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness or sufficiency
of this Agreement or any other Loan Document; (ii) the assigning Lender
has made no representation or warranty and assumes no responsibility with
respect to the financial condition of Borrower or the performance by
Borrower of the Obligations; (iii) it has received a copy of this
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 8.1 and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into such Commitment Assignment and Acceptance;
(iv) it will, independently and without reliance upon the Managing Agent
or any Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement; (v) it appoints and
authorizes the Managing Agent to take such action and to exercise such
powers under this Agreement as are delegated to the Managing Agent by
this Agreement; and (vi) it will perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.
(d) The Managing Agent shall maintain at the Managing Agent's
Office a copy of each Commitment Assignment and Acceptance delivered to
it and a register (the "Register") of the names and address of each of
the Lenders and the Pro Rata Share of the Commitment held by each Lender,
giving effect to each Commitment Assignment and Acceptance. The Register
shall be available during normal business hours for inspection by
Borrower or any Lender upon reasonable prior notice to the Managing
Agent. After receipt of a
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completed Commitment Assignment and Acceptance executed by any Lender
and an Eligible Assignee, and receipt of an assignment fee of $2,500
from such Lender or Eligible Assignee, the Managing Agent shall,
promptly following the effective date thereof, provide to Borrower and
the Lenders a revised SCHEDULE 1.1 giving effect thereto. Borrower,
the Managing Agent and the Lenders shall deem and treat the Persons
listed as Lenders in the Register as the holders and owners of the Pro
Rata Share of the Commitment listed therein for all purposes hereof,
and no assignment or transfer of any such Pro Rata Share of the
Commitment shall be effective, in each case unless and until a
Commitment Assignment and Acceptance effecting the assignment or
transfer thereof shall have been accepted by the Managing Agent and
recorded in the Register as provided above. Prior to such
recordation, all amounts owed with respect to the applicable Pro Rata
Share of the Commitment shall be owed to the Lender listed in the
Register as the owner thereof, and any request, authority or consent
of any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Pro Rata Share of the Commitment.
(e) Each Lender may from time to time grant participations to
one or more banks or other financial institutions (INCLUDING another
Lender) in a portion of its Pro Rata Share of the Commitment; PROVIDED,
HOWEVER, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, (iii) the
participating banks or other financial institutions shall not be a Lender
hereunder for any purpose EXCEPT, if the participation agreement so
provides, for the purposes of Sections 3.8, 3.9, 12.11 and 12.22 but only
to the extent that the cost of such benefits to Borrower does not exceed
the cost which Borrower would have incurred in respect of such Lender
absent the participation, (iv) Borrower, the Managing Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement, (v) the participation interest shall be expressed as a
percentage of the granting Lender's Pro Rata Share of the Commitment as
it then exists and shall not restrict an increase in the Commitment, or
in the granting Lender's Pro Rata Share of the Commitment, so long as the
amount of the participation interest is not affected thereby, and
(vi) the consent of the holder of such participation interest shall not
be required for amendments or waivers of provisions of the Loan Documents
OTHER THAN those which (A) extend any Amortization Date, the Maturity
Date or any other date upon which any payment of money is due to the
Lenders, (B) reduce the rate of interest on the Notes, any fee or any
other monetary amount payable to the Lenders, (C) reduce the amount of
any installment of principal due under the Notes, or (D) release any
material portion of the Collateral (except as may be otherwise expressly
provided for in any Loan Document).
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(f) Notwithstanding anything in this Section to the contrary,
the rights of the Lenders to make assignments of, and grant
participations in, their Pro Rata Shares of the Commitment shall be
subject to the approval of any Gaming Board, to the extent required by
applicable Gaming Laws, and to compliance with applicable securities
laws.
12.9 RIGHT OF SETOFF. If an Event of Default has occurred and is
continuing, the Managing Agent or any Lender (but in each case only with the
consent of the Requisite Lenders) may exercise its rights under Article 9 of the
Uniform Commercial Code and other applicable Laws and, to the extent permitted
by applicable Laws, apply any funds in any deposit account maintained with it by
Borrower and/or any Property of Borrower in its possession against the
Obligations.
12.10 SHARING OF SETOFFS. Each Lender severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against Borrower, or otherwise, receives payment of the Obligations held by it
that is ratably more than any other Lender, through any means, receives in
payment of the Obligations held by that Lender, then, subject to applicable
Laws: (a) the Lender exercising the right of setoff, banker's lien or
counterclaim or otherwise receiving such payment shall purchase, and shall be
deemed to have simultaneously purchased, from the other Lender a participation
in the Obligations held by the other Lender and shall pay to the other Lender a
purchase price in an amount so that the share of the Obligations held by each
Lender after the exercise of the right of setoff, banker's lien or counterclaim
or receipt of payment shall be in the same proportion that existed prior to the
exercise of the right of setoff, banker's lien or counterclaim or receipt of
payment; and (b) such other adjustments and purchases of participations shall be
made from time to time as shall be equitable to ensure that all of the Lenders
share any payment obtained in respect of the Obligations ratably in accordance
with each Lender's share of the Obligations immediately prior to, and without
taking into account, the payment; PROVIDED that, if all or any portion of a
disproportionate payment obtained as a result of the exercise of the right of
setoff, banker's lien, counterclaim or otherwise is thereafter recovered from
the purchasing Lender by Borrower or any Person claiming through or succeeding
to the rights of Borrower, the purchase of a participation shall be rescinded
and the purchase price thereof shall be restored to the extent of the recovery,
but without interest. Each Lender that purchases a participation in the
Obligations pursuant to this Section shall from and after the purchase have the
right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased. Borrower expressly consent to
the foregoing arrangements and agree that any Lender holding a participation in
an Obligation so purchased may exercise any and all rights of setoff, banker's
lien or counterclaim with respect to the participation as fully as if the Lender
were the original owner of the Obligation purchased.
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12.11 INDEMNITY BY BORROWER. Borrower agrees to indemnify, save
and hold harmless the Managing Agent and each Lender and their directors,
officers, agents, attorneys and employees (collectively the "INDEMNITEES") from
and against: (a) any and all claims, demands, actions or causes of action
(EXCEPT a claim, demand, action, or cause of action for any amount excluded from
the definition of "Taxes" in Section 3.12(d)) if the claim, demand, action or
cause of action arises out of or relates to any act or omission (or alleged act
or omission) of Borrower, their Affiliates or any of their officers, directors
or stockholders relating to the Commitment, the use or contemplated use of
proceeds of any Loan, or the relationship of Borrower and the Lenders under this
Agreement; (b) any administrative or investigative proceeding by any
Governmental Agency arising out of or related to a claim, demand, action or
cause of action described in clause (a) above; and (c) any and all liabilities,
losses, costs or expenses (INCLUDING reasonable attorneys' fees and the
reasonably allocated costs of attorneys employed by any Indemnitee and
disbursements of such attorneys and other professional services) that any
Indemnitee suffers or incurs as a result of the assertion of any foregoing
claim, demand, action or cause of action; PROVIDED that no Indemnitee shall be
entitled to indemnification for any loss caused by its own gross negligence or
willful misconduct or for any loss asserted against it by another Indemnitee.
If any claim, demand, action or cause of action is asserted against any
Indemnitee, such Indemnitee shall promptly notify Borrower, but the failure to
so promptly notify Borrower shall not affect Borrower's obligations under this
Section unless such failure materially prejudices Borrower's right to
participate in the contest of such claim, demand, action or cause of action, as
hereinafter provided. Such Indemnitee may (and shall, if requested by Borrower
in writing) contest the validity, applicability and amount of such claim,
demand, action or cause of action and shall permit Borrower to participate in
such contest. Any Indemnitee that proposes to settle or compromise any claim or
proceeding for which Borrower may be liable for payment of indemnity hereunder
shall give Borrower written notice of the terms of such proposed settlement or
compromise reasonably in advance of settling or compromising such claim or
proceeding and shall obtain Borrower's prior consent (which shall not be
unreasonably withheld or delayed). In connection with any claim, demand, action
or cause of action covered by this Section against more than one Indemnitee, all
such Indemnitees shall be represented by the same legal counsel (which may be a
law firm engaged by the Indemnitees or attorneys employed by an Indemnitee or a
combination of the foregoing) selected by the Indemnitees and reasonably
acceptable to Borrower; PROVIDED, that if such legal counsel determines in good
faith that representing all such Indemnitees would or could result in a conflict
of interest under Laws or ethical principles applicable to such legal counsel or
that a defense or counterclaim is available to an Indemnitee that is not
available to all such Indemnitees, then to the extent reasonably necessary to
avoid such a conflict of interest or to permit unqualified assertion of such a
defense or counterclaim, each Indemnitee so affected shall be entitled to
separate representation by legal counsel selected by that Indemnitee and
reasonably acceptable to Borrower, with all such legal counsel using reasonable
efforts to avoid unnecessary duplication of effort by counsel for all
Indemnitees; and FURTHER PROVIDED that the Managing Agent (as an Indemnitee)
shall at all times be entitled to representation by separate
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legal counsel (which may be a law firm or attorneys employed by the Managing
Agent or a combination of the foregoing). Any obligation or liability of
Borrower to any Indemnitee under this Section shall survive the expiration or
termination of this Agreement, the repayment of all Loans and the payment and
performance of all other Obligations owed to the Lenders.
12.12 NONLIABILITY OF THE LENDERS. Borrower acknowledges and
agrees that:
(a) Any inspections of any Property of Borrower made by or
through the Managing Agent or the Lenders are for purposes of
administration of the Loan only and Borrower is not entitled to rely upon
the same (whether or not such inspections are at the expense of
Borrower);
(b) By accepting or approving anything required to be
observed, performed, fulfilled or given to the Managing Agent or the
Lenders pursuant to the Loan Documents, neither the Managing Agent nor
the Lenders shall be deemed to have warranted or represented the
sufficiency, legality, effectiveness or legal effect of the same, or of
any term, provision or condition thereof, and such acceptance or approval
thereof shall not constitute a warranty or representation to anyone with
respect thereto by the Managing Agent or the Lenders;
(c) The relationship between Borrower and the Managing Agent
and the Lenders is, and shall at all times remain, solely that of
borrower and lenders; neither the Managing Agent nor the Lenders shall
under any circumstance be construed to be partners or joint venturers of
Borrower or its Affiliates; neither the Managing Agent nor the Lenders
shall under any circumstance be deemed to be in a relationship of
confidence or trust or a fiduciary or other "special" relationship with
Borrower or its Affiliates, or to owe any fiduciary duty to Borrower or
its Affiliates; neither the Managing Agent nor the Lenders undertake or
assume any responsibility or duty to Borrower or its Affiliates to
select, review, inspect, supervise, pass judgment upon or inform Borrower
or its Affiliates of any matter in connection with their Property or the
operations of Borrower or its Affiliates; Borrower and its Affiliates
shall rely entirely upon their own judgment with respect to such matters;
and any review, inspection, supervision, exercise of judgment or supply
of information undertaken or assumed by the Managing Agent or the Lenders
in connection with such matters is solely for the protection of the
Managing Agent and the Lenders and neither Borrower nor any other Person
is entitled to rely thereon; and
(d) The Managing Agent and the Lenders shall not be
responsible or liable to any Person for any loss, damage, liability or
claim of any kind relating to injury or death to Persons or damage to
Property caused by the actions, inaction or negligence of Borrower and/or
its Affiliates and Borrower hereby indemnifies and hold the Managing
Agent and the Lenders harmless on the terms set forth in Section 12.11
from any such loss, damage, liability or claim.
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12.13 NO THIRD PARTIES BENEFITED. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
Borrower, the Managing Agent and the Lenders in connection with the Loans, and
is made for the sole benefit of Borrower, the Managing Agent and the Lenders,
and the Managing Agent's and the Lenders' successors and assigns. EXCEPT as
provided in Sections 12.8 and 12.11, no other Person shall have any rights of
any nature hereunder or by reason hereof.
12.14 CONFIDENTIALITY. Each Lender agrees to hold any confidential
information that it may receive from Borrower pursuant to this Agreement in
confidence, EXCEPT for disclosure: (a) to other Lenders; (b) to legal counsel
and accountants for Borrower or any Lender; (c) to other professional advisors
to Borrower or any Lender, provided that the recipient has accepted such
information subject to a confidentiality agreement substantially similar to this
Section; (d) to regulatory officials having jurisdiction over that Lender; (e)
to any Gaming Board having regulatory jurisdiction over Borrower or its
Subsidiaries, provided that each Lender agrees to notify Borrower of any such
disclosure unless prohibited by applicable Laws; (f) as required by Law or legal
process, provided that such Lender agrees to notify Borrower of any such
disclosures unless prohibited by applicable Laws or in connection with any legal
proceeding to which that Lender and Borrower are adverse parties; and (g) to
another financial institution in connection with a disposition or proposed
disposition to that financial institution of all or part of that Lender's
interests hereunder or a participation interest in its Note, provided that the
recipient has accepted such information subject to a confidentiality agreement
substantially similar to this Section. For purposes of the foregoing,
"confidential information" shall mean any information respecting Borrower or its
Subsidiaries reasonably considered by Borrower to be confidential, OTHER THAN
(i) information previously filed with any Governmental Agency and available to
the public, (ii) information previously published in any public medium from a
source other than, directly or indirectly, that Lender, and (iii) information
previously disclosed by Borrower to any Person not associated with Borrower
without a confidentiality agreement or obligation substantially similar to this
Section. Nothing in this Section shall be construed to create or give rise to
any fiduciary duty on the part of the Managing Agent or the Lenders to Borrower.
12.15 FURTHER ASSURANCES. Borrower and its Subsidiaries shall, at
their expense and without expense to the Lenders or the Managing Agent, do,
execute and deliver such further acts and documents as the Requisite Lenders or
the Managing Agent from time to time reasonably require for the assuring and
confirming unto the Lenders or the Managing Agent of the rights hereby created
or intended now or hereafter so to be, or for carrying out the intention or
facilitating the performance of the terms of any Loan Document.
12.16 INTEGRATION. This Agreement, together with the other Loan
Documents and the letter agreements referred to in Sections 3.2, 3.6 and 3.7,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and supersedes all prior agreements, written or oral, on the
subject matter hereof. In the event of any conflict between
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the provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control and govern; PROVIDED that the
inclusion of supplemental rights or remedies in favor of the Managing Agent
or the Lenders in any other Loan Document shall not be deemed a conflict with
this Agreement. Each Loan Document was drafted with the joint participation
of the respective parties thereto and shall be construed neither against nor
in favor of any party, but rather in accordance with the fair meaning thereof.
12.17 GOVERNING LAW. This Agreement shall be governed by, and
construed and enforced in accordance with, the local Laws of California
applicable to contracts made and performed in California.
12.18 SEVERABILITY OF PROVISIONS. Any provision in any Loan
Document that is held to be inoperative, unenforceable or invalid as to any
party or in any jurisdiction shall, as to that party or jurisdiction, be
inoperative, unenforceable or invalid without affecting the remaining provisions
or the operation, enforceability or validity of that provision as to any other
party or in any other jurisdiction, and to this end the provisions of all Loan
Documents are declared to be severable.
12.19 HEADINGS. Article and Section headings in this Agreement and
the other Loan Documents are included for convenience of reference only and are
not part of this Agreement or the other Loan Documents for any other purpose.
12.20 TIME OF THE ESSENCE. Time is of the essence of the Loan
Documents.
12.21 FOREIGN LENDERS AND PARTICIPANTS. Each Lender that is
incorporated or otherwise organized under the Laws of a jurisdiction other than
the United States of America or any State thereof or the District of Columbia
shall deliver to Borrower (with a copy to the Managing Agent), within
twenty (20) days after the Closing Date (or after accepting an assignment or
receiving a participation interest herein pursuant to Section 12.8, if
applicable) two duly completed copies, signed by a Responsible Official, of
either Form 1001 (relating to such Lender and entitling it to a complete
exemption from withholding on all payments to be made to such Lender by Borrower
pursuant to this Agreement) or Form 4224 (relating to all payments to be made to
such Lender by Borrower pursuant to this Agreement) of the United States
Internal Revenue Service or such other evidence (INCLUDING, if reasonably
necessary, Form W-9) satisfactory to Borrower and the Managing Agent that no
withholding under the federal income tax laws is required with respect to such
Lender. Thereafter and from time to time, each such Lender shall upon request
by Borrower (a) promptly submit to Borrower (with a copy to the Managing Agent),
such additional duly completed and signed copies of one of such forms (or such
successor forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may then be available under then current United
States laws and regulations to avoid, or such evidence as is satisfactory to
Borrower and the Managing Agent of any available exemption from, United States
withholding taxes in respect of all payments to be made to such Lender by
Borrower pursuant to this Agreement and (b) take such
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steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Eurodollar Lending Office, if any) to avoid any
requirement of applicable Laws that Borrower make any deduction or
withholding for taxes from amounts payable to such Lender. In the event that
Borrower or the Managing Agent become aware that a participation has been
granted pursuant to Section 12.8(e) to a financial institution that is
incorporated or otherwise organized under the Laws of a jurisdiction other
than the United States of America, any State thereof or the District of
Columbia, then, upon request made by Borrower or the Managing Agent to the
Lender which granted such participation, such Lender shall cause such
participant financial institution to deliver the same documents and
information to Borrower and the Managing Agent as would be required under
this Section if such financial institution were a Lender.
12.22 HAZARDOUS MATERIAL INDEMNITY. Borrower hereby agrees to
indemnify, hold harmless and defend (by counsel reasonably satisfactory to the
Managing Agent) the Managing Agent and each of the Lenders and their respective
directors, officers, employees, agents, successors and assigns from and against
any and all claims, losses, damages, liabilities, fines, penalties, charges,
administrative and judicial proceedings and orders, judgments, remedial action
requirements, enforcement actions of any kind, and all costs and expenses
incurred in connection therewith (INCLUDING reasonable attorneys' fees and the
reasonably allocated costs of attorneys employed by the Managing Agent or any
Lender, and expenses to the extent that the defense of any such action has not
been assumed by Borrower), arising directly or indirectly out of (i) the
presence on, in, under or about any Real Property of any Hazardous Materials, or
any releases or discharges of any Hazardous Materials on, under or from any Real
Property and (ii) any activity carried on or undertaken on or off any Real
Property by Borrower or any of its predecessors in title, whether prior to or
during the term of this Agreement, and whether by Borrower or any predecessor in
title or any employees, agents, contractors or subcontractors of Borrower or any
predecessor in title, or any third persons at any time occupying or present on
any Real Property, in connection with the handling, treatment, removal, storage,
decontamination, clean-up, transport or disposal of any Hazardous Materials at
any time located or present on, in, under or about any Real Property. The
foregoing indemnity shall further apply to any residual contamination on, in,
under or about any Real Property, or affecting any natural resources, and to any
contamination of any Property or natural resources arising in connection with
the generation, use, handling, storage, transport or disposal of any such
Hazardous Materials, and irrespective of whether any of such activities were or
will be undertaken in accordance with applicable Laws, but the foregoing
indemnity shall not apply to Hazardous Materials on any Real Property, the
presence of which is caused by the Managing Agent or the Lenders. Borrower
hereby acknowledges and agrees that, notwithstanding any other provision of this
Agreement or any of the other Loan Documents to the contrary, the obligations of
Borrower under this Section (and under Sections 4.18 and 5.11) shall be
unlimited corporate obligations of Borrower and shall NOT be secured by any deed
of trust on any Real Property. Any obligation or liability of Borrower to any
Indemnitee under this Section shall survive the expiration or termination of
this Agreement, the repayment of all Loans
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and the payment and performance of all other Obligations owed to the Lenders.
12.23 GAMING BOARDS. The Managing Agent and each of the Lenders
agree to cooperate with all Gaming Boards in connection with the administration
of their regulatory jurisdiction over Borrower and its Subsidiaries, INCLUDING
the provision of such documents or other information as may be requested by any
such Gaming Board relating to Borrower or any of its Subsidiaries or to the Loan
Documents.
12.24 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTY HERETO OR
ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
12.25 PURPORTED ORAL AMENDMENTS. BORROWER EXPRESSLY ACKNOWLEDGES
THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR
MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF WAIVED OR SUPPLEMENTED, BY AN
INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 12.2. BORROWER AGREES THAT IT
WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR
WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF THE MANAGING AGENT OR ANY LENDER
THAT DOES NOT COMPLY WITH
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SECTION 12.2 TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER OR SUPPLEMENT TO
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
SUNSET STATION, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxx
---------------------------------
Xxxxx X. Xxxxxxxxxxx
Vice President, Chief Financial
Officer and Treasurer
Address:
c/o Station Casinos, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxxxx
Executive Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
With a copy to:
Station Casinos, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxx Xxxxxx
Director of Finance
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-00-
XXXX XX XXXXXXX NATIONAL TRUST AND
SAVINGS ASSOCIATION, Managing Agent and
as a Lender
By: /s/ Xxxxx Xxxxx
-----------------------------------
Xxxxx Xxxxx
Vice President
Address:
Bank of America National Trust and
Savings Association
000 Xxxxx Xxxxxx Xxxxxx, #0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
With a copy to:
Bank of America National Trust and
Savings Association
000 Xxxxx Xxxxxx Xxxxxx (XX-0000)
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx
Managing Director
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-00-
XXXX XX XXXXXXXX, as a Co-Agent and a
Lender
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxxxxx X. Xxxxxxxx
Vice President
Address:
Bank of Scotland
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxxx X. Xxxxxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
SOCIETE GENERALE, as a Co-Agent and a
Lender
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx
Vice President
Address:
Societe Generale
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
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THE LONG-TERM CREDIT BANK OF JAPAN, LTD.,
LOS ANGELES AGENCY, as a Lender
By: /s/ Xxxx Xxxxxxxx
-----------------------------------
Xxxx Xxxxxxxx
Deputy General Manager
Address:
The Long-Term Credit Bank of Japan, Ltd.,
Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx Xxxxxxxx
Deputy General Manager
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
MICHIGAN NATIONAL BANK, as a Lender
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxx
Second Vice President
Address:
Michigan National Bank
27777 Inkster Road, M/C 00-00
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Second Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-100-
PILGRIM AMERICA PRIME RATE TRUST, as a
Lender
By: /s/ Xxx Xxxxxx
-----------------------------------
Xxx Xxxxxx
Senior Vice President
Address:
Pilgrim America Prime Rate Trust
Two Renaissance Square
00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxx Xxxxxx
Senior Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
BANK OF AMERICA NEVADA, as a Lender
By: /s/ Xxxx Xxxxxx
-----------------------------------
Xxxx Xxxxxx
Vice President
Address:
Bank of America Nevada
Commercial Banking Division - CB 2006
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxx Xxxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-101-
THE NIPPON CREDIT BANK, LTD., LOS ANGELES
AGENCY, as a Lender
By: /s/ Xxx Xxxxxxxx
-----------------------------------
Xxx Xxxxxxxx
Vice President and Manager
Address:
The Nippon Credit Bank, Ltd.,
Los Angeles Agency
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxxxxx
Vice President and Manager
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
PNC BANK, N.A., as a Lender
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
Vice President
Address:
PNC Bank, N.A.
0 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxx Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-102-
BANK OF THE WEST, as a Lender
By: /s/ Xxxx Xxxxxx
-----------------------------------
Xxxx Xxxxxx
Regional Vice President
Address:
Bank of the West
0000 Xxxxx Xxxxxxxxx
Xxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxx Xxxxxx
Regional Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
FIRST SECURITY BANK, N.A., as a Lender
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx
Vice President
Address:
First Security Bank, N.A.
Commercial Banking Division
15 East 000 Xxxxx, 0xx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attn: Xxxxx Xxxxxxxx
Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-103-
XXXXXXXXX XXXXXXX FINANCE CORPORATION, as
a Lender
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx
Vice President - Operations
Address:
XxXxxxxxx Xxxxxxx Finance Corporation
0000 Xxxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxxxxxxxx
Director - Operations
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
