Exhibit 4.1
THIS INDENTURE IS, FOR PURPOSES OF TITLE 38 OF THE COLORADO REVISED STATUTES,
THE "ORIGINAL EVIDENCE OF INDEBTEDNESS" SECURED BY THE DEED OF TRUST (AS DEFINED
HEREIN).
================================================================================
WINDSOR WOODMONT BLACK HAWK RESORT CORP.
$100,000,000
13% FIRST MORTGAGE NOTES DUE 2005
---------------------------
INDENTURE
Dated as of March 14, 2000
---------------------------
SunTrust Bank
Trustee
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Windsor Woodmont Black Hawk Resort Corp.
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture dated as of March 14, 2000
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Trust Indenture
Act Section Indenture Section
----------- -----------------
(S) 310(a)(1) 7.10
(S) 310(a)(2) 7.10
(S) 310(b) 7.03
(S) 311 7.03; 7.11
(S) 312(a) 2.05
(S) 312(b) 11.03
(S) 312(c) 11.03
(S) 313(a) 7.06
(S) 313(b) 7.06; 7.07
(S) 313(c) 7.06
(S) 314(a) 4.03
(S) 314(a)(4) 4.04
(S) 314(b) 10.02(b) and (c)
(S) 314(c) 11.04
(S) 314(d) 10.03; 10.04
(S) 314(e) 11.05
(S) 315(a) 7.02
(S) 315(b) 7.05
(S) 315(c) 7.01(a)
(S) 315(d) 7.01(d)
(S) 315(e) 6.11
(S) 316(a)(1)(A) 6.05
(S) 316(a)(1)(B) 6.04
(S) 316(b) 6.07
(S) 317(a)(1) 6.08
(S) 317(a)(2). 6.09
(S) 317(b) 2.04
(S) 318(a) 11.01
(S) 318(c) 11.01
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
Page No.
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ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE............................1
Section 1.01. Definitions...........................................1
Section 1.02 Incorporation by Reference of Trust Indenture Act....26
Section 1.03. Rules of Construction................................27
ARTICLE 2.
THE NOTES............................................................27
Section 2.01 Form and Dating......................................27
Section 2.02 Execution and Authentication ........................28
Section 2.03. Registrar and Paying Agent...........................29
Section 2.04. Paying Agent to Hold Money in Trust..................30
Section 2.05. Holder Lists.........................................30
Section 2.06. Transfer and Exchange................................30
Section 2.07. Replacement Notes....................................44
Section 2.08. Outstanding Notes....................................44
Section 2.09. Treasury Notes.......................................45
Section 2.10. Temporary Notes......................................45
Section 2.11. Cancellation.........................................45
Section 2.12. Defaulted Interest...................................45
Section 2.13. CUSIP Number.........................................46
Section 2.14. Exchange Registration................................46
ARTICLE 3.
REDEMPTION AND PREPAYMENT............................................46
Section 3.01 Notices to Trustee...................................46
Section 3.02. Selection of Notes to Be Redeemed....................46
Section 3.03. Notice of Redemption.................................47
Section 3.04. Effect of Notice of Redemption.......................47
Section 3.05. Deposit of Redemption Price..........................48
Section 3.06. Notes Redeemed in Part...............................48
Section 3.07. Optional Redemption..................................48
Section 3.08 Mandatory Redemption.................................49
Section 3.09. Gaming Redemption....................................49
Section 3.10. Offer to Purchase by Application of Excess Proceeds .50
ARTICLE 4.
COVENANTS............................................................52
Section 4.01. Payment of Notes.....................................52
Section 4.02. Maintenance of Office or Agency......................52
i
Section 4.03. Reports..............................................53
Section 4.04. Compliance Certificate...............................53
Section 4.05. Taxes................................................54
Section 4.06. Stay, Extension and Usury Laws.......................54
Section 4.07. Restricted Payments..................................54
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries .......................................58
Section 4.09. Incurrence of Indebtedness and Issuance of
Preferred Stock.....................................59
Section 4.10. Asset Sales..........................................63
Section 4.11. Transactions with Affiliates.........................65
Section 4.12. Liens................................................67
Section 4.13. Line of Business.....................................67
Section 4.14. Corporate Existence..................................67
Section 4.15. Articles of Incorporation............................67
Section 4.16. Limitation on Sale and Leaseback Transactions .......67
Section 4.17. Limitation on Formation of Subsidiaries and
Issuances and Sales of Equity Interests in
Wholly Owned Subsidiaries...........................68
Section 4.18. Advances to Subsidiaries.............................68
Section 4.19. Payments for Consent.................................68
Section 4.20. Additional Subsidiary Guarantees.....................69
Section 4.21. Insurance ...........................................69
Section 4.22. Limitation on Status as Investment Company...........70
Section 4.23. Further Assurances...................................70
Section 4.24. Construction.........................................71
Section 4.25. Limitation on Use of Proceeds........................71
Section 4.26. Right of First Offer with Respect to
Hotel Additional Notes..............................71
Section 4.27. Restriction on Payment of Management Fees............72
Section 4.28. Event of Loss........................................73
Section 4.29. Excess Cash Purchase Offers .........................75
Section 4.30. Approvals Under Management Agreement.................76
Section 4.31. Extension of Subdivision Agreement...................76
Section 4.32. Deposit of Funds into Construction
Disbursement Accounts...............................76
ARTICLE 5.
SUCCESSORS...........................................................76
Section 5.01. Merger, Consolidation, or Sale of Assets.............76
Section 5.02. Successor Corporation Substituted....................77
ARTICLE 6.
DEFAULTS AND REMEDIES................................................78
Section 6.01. Events of Default....................................78
Section 6.02. Acceleration, Etc....................................80
Section 6.03. Other Remedies.......................................80
Section 6.04. Waiver of Past Defaults..............................81
Section 6.05. Control by Majority..................................81
ii
Section 6.06. Limitation on Suits..................................81
Section 6.07. Rights of Holders of Notes to Receive Payment .......82
Section 6.08. Collection Suit by Trustee...........................82
Section 6.09. Trustee May File Proofs of Claim.....................82
Section 6.10. Priorities...........................................83
Section 6.11. Undertaking for Costs................................83
ARTICLE 7.
TRUSTEE..............................................................84
Section 7.01. Duties of Trustee....................................84
Section 7.02. Rights of Trustee....................................85
Section 7.03. Individual Rights of Trustee ........................85
Section 7.04. Trustee's Disclaimer.................................86
Section 7.05. Notice of Defaults, Etc..............................86
Section 7.06. Reports by Trustee to Holders of the Notes...........86
Section 7.07. Compensation and Indemnity...........................87
Section 7.08. Replacement of Trustee...............................88
Section 7.09. Successor Trustee by Xxxxxx, etc.....................89
Section 7.10. Eligibility; Disqualification........................89
Section 7.11. Preferential Collection of Claims Against Company....90
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE.............................90
Section 8.01. Option to Effect Legal Defeasance or
Covenant Defeasance ................................90
Section 8.02. Legal Defeasance and Discharge.......................90
Section 8.03. Covenant Defeasance..................................91
Section 8.04. Conditions to Legal or Covenant Defeasance...........91
Section 8.05. Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions.......92
Section 8.06. Repayment to Company.................................93
Section 8.07. Reinstatement........................................93
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER.....................................94
Section 9.01. Without Consent of Holders of Notes..................94
Section 9.02. With Consent of Holders of Notes.....................94
Section 9.03. Compliance with Trust Indenture Act..................96
Section 9.04. Revocation and Effect of Consents....................96
Section 9.05. Notation on or Exchange of Notes.....................96
Section 9.06. Trustee to Sign Amendments, etc......................96
ARTICLE 10.
COLLATERAL AND SECURITY..............................................97
Section 10.01. Security.............................................97
iii
Section 10.02. Recording and Opinions...............................97
Section 10.03. Release of Collateral................................99
Section 10.04. Certificates of the Company..........................99
Section 10.05. Certificates of the Trustee.........................100
Section 10.06. Authorization of Actions to Be Taken by the
Trustee Under the Collateral Documents.............100
Section 10.07. Authorization of Receipt of Funds by the
Trustee Under the Collateral Documents.............101
Section 10.08. Termination of Security Interest....................101
Section 10.09. Cooperation Of Trustee..............................101
Section 10.10. Collateral Agent....................................101
ARTICLE 11.
MISCELLANEOUS.......................................................102
Section 11.01. Trust Indenture Act Controls........................102
Section 11.02. Notices.............................................102
Section 11.03. Communication by Holders of Notes with
Other Holders of Notes ............................103
Section 11.04. Certificate and Opinion as to
Conditions Precedent ..............................103
Section 11.05. Statements Required in Certificate or Opinion ......103
Section 11.06. Rules by Trustee and Agents.........................104
Section 11.07. No Personal Liability of Directors, Officers,
Employees and Stockholders.........................104
Section 11.08. Governing Law.......................................104
Section 11.09. No Adverse Interpretation of Other Agreements ......104
Section 11.10. Successors .........................................105
Section 11.11. Severability........................................105
Section 11.12. Counterpart Originals...............................105
Section 11.13. Table of Contents, Headings, etc....................105
Section 11.14. Gaming and Liquor Laws..............................105
iv
EXHIBITS
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Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED
INVESTOR
Exhibit E FORM OF SUPPLEMENTAL INDENTURE
Exhibit F FORM OF SUBSIDIARY INTERCOMPANY NOTE
Exhibit G FORM OF PLEDGE AGREEMENT
v
THIS INDENTURE IS, FOR PURPOSES OF TITLE 38 OF THE COLORADO REVISED
STATUTES, THE "ORIGINAL EVIDENCE OF INDEBTEDNESS" SECURED BY THE DEED OF TRUST
(AS DEFINED HEREIN).
INDENTURE dated as of March 14, 2000, between Windsor Woodmont Black Hawk
Resort Corp., a Colorado corporation (the "Company"), and SunTrust Bank, as
trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each other
and for the equal and ratable benefit of the Holders (as defined below) of the
13% First Mortgage Notes due 2005) (the "Series A Notes") and the 13% Series B
First Mortgage Notes due 2005 (the "Series B Notes" and, together with the
Series A Notes, the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
------------------------------------------
Section 1.01. Definitions
-----------
"144A Global Note" means a global note substantially in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Ableco" has the meaning set forth in Section 4.26.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Restricted Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Restricted Subsidiary of such specified Person; and (ii) Indebtedness secured by
a Lien encumbering any asset acquired by such specified Person.
"Additional Notes" means additional Notes (other than the Initial Notes)
issued under this Indenture, as part of the same series as the Initial Notes.
"Advance Disbursement Account" means the Advance Disbursement Account as
defined in the Cash Collateral and Disbursement Agreement.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by,"
and "under common control with") as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the Voting Stock of a Person shall be
deemed to be control.
"Affiliate Transaction" has the meaning set forth in Section 4.11.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depositary that apply to such transfer or exchange.
"Asset Sale" means: (i) the sale, lease, conveyance or other disposition of
any assets or rights (including, without limitation, by way of a sale and
leaseback), whether in a single transaction or a series of related transactions
(a) that have a fair market value in excess of $250,000, (b) for net proceeds in
excess of $250,000, or (c) that consist of or relate to any assets or rights
other than used equipment to be sold or disposed of in the ordinary course of
business, provided that the sale, lease, conveyance or other disposition of all
or substantially all of the assets of the Company and its Subsidiaries, taken as
a whole, will be governed by Section 5.01 and not by Section 4.10; and (ii) the
issuance or sale by the Company or any of its Restricted Subsidiaries of Equity
Interests of any of its Restricted Subsidiaries. Notwithstanding the foregoing,
the following shall not be deemed to be Asset Sales: (i) a transfer of assets by
the Company to a Wholly Owned Restricted Subsidiary or by a Wholly Owned
Restricted Subsidiary to the Company or to another Wholly Owned Restricted
Subsidiary; (ii) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary to the Company or to another Wholly Owned Restricted Subsidiary;
(iii) a Restricted Payment that is permitted by Section 4.07; (iv) the
disposition of all or substantially all of the assets of the Company and its
Subsidiaries taken as a whole governed by Section 5.01; (v) a disposition of
Cash Equivalents permitted by the provisions hereof; and (vi) the granting of
any Permitted Lien.
"Asset Sale Offer " shall have the meaning set forth in Section 4.10.
"Attributable Debt" in respect of a sale and leaseback transaction means,
at the time of determination, the present value (discounted at the rate of
interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Authentication Order" shall have the meaning set forth in Section 2.02.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Basic Fee" means the Basic Fee (as defined in the Management Agreement)
payable pursuant to Section 4.2(a)(i) of the Management Agreement, as in effect
on the Closing Date.
2
"Bench Excavation Permit Remediation" means Site Rehabilitation Security
pursuant to Section 18-251 of the Black Hawk Municipal Code.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition. The terms
"Beneficially Owns" and "Beneficially Owned" shall have a corresponding meaning.
"Black Hawk Casino" means the pending project to develop, construct, equip
and operate the Company's casino in Black Hawk, Colorado and related amenities,
as described in the Offering Memorandum.
"Board of Directors" means: (i) with respect to a corporation, the board of
directors of the corporation; (ii) with respect to a partnership, the Board of
Directors of the general partner of the partnership; and (iii) with respect to
any other Person, the board or committee of such Person serving a similar
function.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate stock;
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock; (iii) in the case of a partnership, partnership interests
(whether general or limited); (iv) in the case of a limited liability company,
membership interests; and (v) any other interest or participation that confers
on a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Collateral Accounts" means, collectively, the Interest Reserve
Account, the Completion Reserve Account, the Construction Disbursement Account
and the Disbursed Funds Account (as defined in the Cash Collateral and
Disbursement Agreement).
"Cash Collateral and Disbursement Agreement" means the Cash Collateral and
Disbursement Agreement among the Trustee, Hyatt Gaming, the Disbursement Agent,
the Construction Escrow Agent, the Independent Construction Consultant and the
Company in connection with the Black Hawk Casino, dated as of the Closing Date.
3
"Cash Equivalents" means (i) United States dollars; (ii) securities issued
or directly and fully guaranteed or insured by the United States government or
any agency or instrumentality thereof having maturities of not more than six
months from the date of acquisition; (iii) certificates of deposit and
Eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any domestic commercial bank having
capital and surplus in excess of $500 million and a Xxxxx Bank Watch Rating of
"B" or better; (iv) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (ii) and (iii)
above entered into with any financial institution meeting the qualifications
specified in clause (iii) above; (v) commercial paper having the highest rating
obtainable from Xxxxx'x Investors Service, Inc. or Standard & Poor's Corporation
and, in each case, maturing within six months after the date of acquisition; and
(vi) investment funds investing solely in securities of the types described in
clauses (ii), (iii), (iv) or (v) above if such fund has net assets of at least
$500 million.
"Change of Control" means the occurrence of any of the following: (i) Hyatt
Gaming no longer operates the Black Hawk Casino pursuant to the Management
Agreement, as the same may be amended from time to time on terms no less
favorable to the Company or the Holders than the terms thereof prior to such
amendment; (ii) the sale, lease, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole, to any "person" (as such term is used in Section
13(d)(3) of the Exchange Act) other than a Related Party; or (iii) the adoption
of a plan relating to the liquidation or dissolution of the Company; or (iv) on
or prior to an Initial Public Offering, the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of which
is that a "person" (as such term is defined in Section 13(d)(3) of the Exchange
Act) or related group (within the meaning of Section 13(d)(3) or Section
14(d)(2) of the Exchange Act), other than Related Parties owns more than 45% of
the total voting power entitled to vote in the election of Directors and such
percentage is greater than the percentage of the total voting power entitled to
vote in the election of Directors owned by the Related Parties; or (v) after an
Initial Public Offering, the acquisition in a single transaction or in a related
series of transactions, by way of merger, consolidation or other business
combination or purchase of beneficial ownership (within the meaning of Rule
13d-3 under the Exchange Act, or any successor provision) by any Person or
related group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act, or any successor provision to either of the foregoing, including
any "group" acting for the purpose of acquiring, holding or disposing of
securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other
than Related Parties owns more than 45% of the total voting power entitled to
vote in the election of Directors and such percentage is greater than the
percentage of the total voting power entitled to vote in the election of
Directors owned by the Related Parties; or (vi) during any period of two
consecutive years, individuals who at the beginning of such period constituted
the Directors (together with any new board members whose election or appointment
by such committee or whose nomination for election by the shareholders of the
Company was approved by a vote of a majority of the board members then still in
office who were either board members at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Directors then in office.
4
"City Improvement Bonds" means Indebtedness issued pursuant to or in
accordance with authority of the Special Improvement District number 1998-2 of
Xxxxxx County, Colorado for the purpose of financing public improvements to
Xxxxxxx Street.
"Clearstream" means Clearstream Banking, Societe Anonyme.
"Closing Date" means the closing date for the sale and original issuance of
the Series A Notes.
"Closing and Pre-Closing Equity Investments" means the investments made by
the stockholders of the Company on or prior to the issue date of the Series A
Notes in the aggregate amount of approximately $11.5 million.
"Collateral" means all assets, now owned or hereafter acquired, of the
Company or any of its Subsidiaries, that are pledged or assigned, or required to
be pledged or assigned under this Indenture or the Collateral Documents, to the
Trustee pursuant to the Collateral Documents which will initially include all
real estate, improvements and all personal property owned by the Company and all
accounts held by or for the benefit of the Company, together with the proceeds
thereof (including, without limitation, the proceeds of Asset Sales), in each
case excluding FF&E acquired, refinanced or leased with FF&E Financing, Gaming
and Liquor Licenses and certain other exceptions and assets of future
Unrestricted Subsidiaries of the Company.
"Collateral Agent" shall have the meaning set forth in Section 10.10.
"Collateral Documents" means, collectively, the Deed of Trust by the
Company to the Public Trustee of the County of Xxxxxx, Colorado, the Security
Agreement by the Company in favor of the Trustee, the Collateral Assignment by
the Company in favor of the Trustee, the Cash Collateral and Disbursement
Agreement, the Pledge Agreement by the DPR 1992 Trust in favor of the Trustee,
the Pledge Agreement by APR 21st Century Trust in favor of the Trustee, the
Pledge Agreement by AMR 21st Century Trust in favor of the Trustee, the Pledge
and Assignment by the Company in favor of the Trustee, the Account Agreement
among the Company, the Trustee and Norwest Bank Minnesota, N.A., as securities
intermediary, the Advance Disbursements Account Agreement among the Company, the
Trustee and Norwest Bank Minnesota, N.A., as securities intermediary, the
Manager Subordination Agreement, Uniform Commercial Code financing statements
and fixture filings, and any other agreements, instruments, documents, pledges
or filings that evidence, set forth or limit the Lien of the Trustee in the
Collateral.
"Company" means Windsor Woodmont Black Hawk Resort Corp. and any and all
successors thereto.
"Completion Reserve Account" means the account to be maintained by the
Disbursement Agent and pledged to the Trustee pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $7.3 million of
the proceeds of the Offering shall be deposited.
5
"Consolidated Cash Flow" means, with respect to any specified Person for
any period, the Consolidated Net Income of such Person for such period plus (i)
an amount equal to any extraordinary loss plus any net loss realized in
connection with an Asset Sale, to the extent such losses were deducted in
computing such Consolidated Net Income; plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income; plus (iii) Consolidated Interest Expense of such
Person and its Restricted Subsidiaries for such period, to the extent that any
such expense was deducted in computing such Consolidated Net Income; plus (iv)
depreciation, amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) of such Person and its Restricted Subsidiaries for such
period, to the extent that such depreciation and amortization were deducted in
computing such Consolidated Net Income, in each case, on a consolidated basis
and determined in accordance with GAAP; plus (v) all other non-cash expenses
(excluding any such non- cash expense to the extent that it represents an
accrual of or reserve for cash expenses in any future period or amortization of
a prepaid cash expense that was paid in a prior period) reducing Consolidated
Net Income for such period; minus (vi) all non-cash items increasing
Consolidated Net Income for such period, other than the accrual of revenue in
the ordinary course of business. Notwithstanding the foregoing, the provision
for taxes on the income or profits of, and the depreciation and amortization of,
a Restricted Subsidiary of the referent Person will be added to Consolidated Net
Income to compute Consolidated Cash Flow only to the extent (and in the same
proportion) that the Net Income of such Restricted Subsidiary was included in
calculating the Consolidated Net Income of such Person and only if a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior
governmental approval (that has not been obtained), and without direct or
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Subsidiary or its stockholders.
"Consolidated Interest Expense" means, with respect to any Person for any
period, without duplication: (i) the consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
and whether or not capitalized (including, without limitation, amortization or
original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, imputed interest with respect to
Attributable Debt, commissions, discounts and other fees and charges incurred in
respect of letter of credit or bankers' acceptance financings, and net payments
(if any) pursuant to Hedging Obligations); (ii) the consolidated interest
expense of such Person and its Restricted Subsidiaries that was capitalized
during such period; and (iii) any interest expense on Indebtedness of another
Person that is Guaranteed by such Person or one of its Restricted Subsidiaries
or secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries (whether or not such Guarantee or Lien is called upon).
"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
provided that: (i) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
6
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or a Wholly Owned Restricted
Subsidiary thereof; (ii) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of such Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to such Restricted Subsidiary or its
stockholders; (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded; (iv) the cumulative effect of a change in accounting principles
will be excluded; and (v) the Net Income (but not loss) of any Unrestricted
Subsidiary will be excluded, whether or not distributed to the specified Person
or one of its Subsidiaries.
"Consolidated Net Worth" means, with respect to any specified Person as of
any date, the sum of: (i) the consolidated equity of the common stockholders of
such Person and its consolidated Subsidiaries as of such date; plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock; minus (iii) all write-ups (other
than write-ups resulting from foreign currency translations and write-ups of
tangible assets of a going concern business made within 12 months after the
acquisition of such business) subsequent to the Closing Date in the book value
of any asset owned by such Person or a consolidated Subsidiary of such Person;
minus (iv) all investments as of such date in unconsolidated Subsidiaries and in
Persons that are not Subsidiaries (except, in each case, Permitted Investments);
minus (v) all unamortized debt discount and expense and unamortized deferred
charges as of such date, all of the foregoing determined in accordance with
GAAP.
"Construction Disbursement Account" means the account to be maintained by
the Disbursement Agent and pledged to the Trustee, pursuant to the terms of the
Cash Collateral and Disbursement Agreement, into which approximately $52.1
million of the net proceeds of the Offering shall be deposited.
"Construction Disbursement Budget" means itemized schedules setting forth
on a line item basis all of the costs (including financing costs) estimated to
be incurred in connection with the financing, design, development, construction
and equipping of the Black Hawk Casino, as such schedules are delivered to the
Disbursement Agent on the Closing Date and as amended from time to time in
accordance with the terms of the Cash Collateral and Disbursement Agreement.
"Construction Escrow Agent" means First American Heritage Title Company.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 11.02 hereof or such other address as to which the
Trustee may give notice to the Company.
7
"Covenant Defeasance" shall have the meaning set forth in Section 8.03.
"Custodian" means the Trustee, as custodian with respect to the Notes in
global form, or any successor entity thereto.
"Deed of Trust" means the Deed of Trust to the Public Trustee, Security
Agreement, Fixture Filing and Assignment of Rents, Leases and Leasehold
Interests, dated as of the Closing Date, by the Company to the Public Trustee of
the County of Xxxxxx, Colorado, for the benefit of the Trustee.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of Exhibit A hereto, except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in whole
or in part in global form, the Person specified in Section 2.03 hereof as the
Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disbursement Agent" means Norwest Bank Minnesota, N.A., as disbursement
agent.
"Disqualified Stock" means any Capital Stock that, 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 redeemable at
the option of the holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders thereof have the right to require the Company to
repurchase or redeem such Capital Stock upon the occurrence of a Change of
Control or an Asset Sale shall not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such change of control or asset sale repurchase
or redemption unless such repurchase or redemption complies with Section 4.07
hereof.
"DTC" shall have the meaning set forth in Section 2.03.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
8
"Equity Offering" means a public offering (other than a public offering
registered on Form S-8 under the Securities Act) or private placement of common
Capital Stock of the Company that results in gross proceeds of at least $25.0
million to the Company.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System.
"Event of Default" shall have the meaning set forth in Section 6.01.
"Event of Loss" means, with respect to any property or asset (tangible or
intangible, real or personal), any of the following: (i) any loss, destruction
or damage of such property or asset; (ii) any institution of any proceedings for
the condemnation or seizure of such property or asset or for the exercise of any
right of eminent domain; (iii) any actual condemnation, seizure or taking by
exercise of the power of eminent domain or otherwise of such property or asset,
or confiscation of such property or asset or the requisition of the use of such
property or asset; or (iv) any settlement in lieu of clauses (ii) or (iii)
above.
"Event of Loss Acceptance" shall have the meaning set forth in Section
4.28.
"Event of Loss Notice" shall have the meaning set forth in Section 4.28.
"Event of Loss Offer" shall have the meaning set forth in Section 4.28.
"Excavation Agreement" means the amended excavation contract, dated
December 31, 1999 between the Company and X. X. Xxxxxxxx & Sons, Inc.
"Excess Cash Flow" means, with respect to the Company for any Operating
Year, the Consolidated Cash Flow of the Company and its Subsidiaries for such
Operating Year, minus (i) interest expense (including the interest portion of
any payments associated with Capital Lease Obligations) of the Company and its
Subsidiaries that is actually paid during such Operating Year, minus (ii) up to
$3.0 million in capital expenditures of the Company and its Subsidiaries paid
during such Operating Year to maintain or improve the Black Hawk Casino
(excluding any capital expenditures made with the proceeds from the sale of the
Notes), minus (iii) up to $1.0 million in capital expenditures of the Company
and its Subsidiaries paid during such Operating Year to ensure the Black Hawk
Casino complies with all applicable laws, rules and regulations, minus (iv)
principal payments made during such Operating Year on Indebtedness permitted to
be incurred pursuant to Section 4.09, and minus (v) taxes of the Company and its
Subsidiaries accrued with respect to such Operating Year.
"Excess Cash Flow Offer" shall have the meaning set forth in Section 4.29.
"Excess Cash Flow Offer Amount" shall have the meaning set forth in Section
4.29.
"Excess Cash Flow Purchase Price" shall have the meaning set forth in
Section 4.29.
9
"Excess Cash Purchase Offer" shall have the meaning set forth in Section
3.10.
"Excess Loss Proceeds" shall have the meaning set forth in Section 4.28.
"Excess Proceeds" shall have the meaning set forth in Section 4.10.
"Excess Proceeds Offer" shall have the meaning set forth in Section 3.10.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Series B Notes issued in the Exchange Offer
pursuant to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"FF&E" means furniture, fixtures or equipment used in the ordinary course
of the business of the Company and its Subsidiaries.
"FF&E Financing" means the incurrence of Indebtedness, the proceeds of
which are utilized solely to finance the acquisition of (or entry into a capital
lease by the Company or a Subsidiary with respect to) FF&E.
"Final Plans" with respect to any particular work or improvement means
Plans which (i) have received final approval from all governmental authorities
required to approve such Plans prior to completion of the work or improvements
and (ii) contain sufficient specificity to permit the completion of the work or
improvement.
"Fixed Charge Coverage Ratio" means with respect to any Person for any
period, the ratio of the Consolidated Cash Flow of such Person and its
Restricted Subsidiaries for such period to the Fixed Charges of such Person and
its Subsidiaries for such period. In the event that the Company or any of their
Subsidiaries incur, assume, guarantee or redeem any Indebtedness (other than
ordinary working capital revolving credit borrowings) or issues preferred stock
subsequent to the commencement of the period for which the Fixed Charge Coverage
Ratio is being calculated but prior to the date on which the event for which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge Coverage Ratio will be calculated giving pro forma effect
to such incurrence, assumption, guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for
purposes of calculating the Fixed Charge Coverage Ratio: (i) acquisitions that
have been made by the Person or any of its Restricted Subsidiaries, including
through mergers or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to such
10
reference period and on or prior to the Calculation Date will be deemed to have
occurred on the first day of the four-quarter reference period and Consolidated
Cash Flow for such reference period will be calculated on a pro forma basis in
accordance with Regulation S-X under the Securities Act, but without giving
effect to clause (iii) of the proviso set forth in the definition of
Consolidated Net Income; (ii) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded; and
(iii) the Fixed Charges attributable to discontinued operations, as determined
in accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such Fixed Charges shall not be obligations of the referent
Person or any of its Restricted Subsidiaries following the Calculation Date.
"Fixed Charges" means, with respect to any Person for any period, without
duplication, the sum of: (i) the Consolidated Interest Expense of such Person
and its Restricted Subsidiaries for such period, whether paid or accrued,
including Interest, but excluding amortization of debt issuance costs and
issuance discounts in connection with the issuance of the Notes, but including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net of the effect of all
payments made or received pursuant to Hedging Obligations; plus (ii) the product
of (a) all dividends, whether paid or accrued, whether or not in cash, on any
series of preferred stock of such Person or any of its Restricted Subsidiaries,
other than dividend payments on Equity Interests payable solely in Equity
Interests of such Person (other than Disqualified Stock) or to the Company or a
Restricted Subsidiary of such Person, times (b) a fraction, the numerator of
which is one and the denominator of which is one minus the then current combined
federal, state and local statutory tax rate of such Person, expressed as a
decimal, plus (iii) if such Person is the Company or any of its Restricted
Subsidiaries, the Basic Fee, in each case, on a consolidated basis and in
accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Gaming Authority" means any agency, authority, board, bureau, commission,
department, office or instrumentality of any nature whatsoever of the United
States federal or foreign government, any state, province or any city or other
political subdivision or otherwise, and whether now or hereafter in existence,
or any officer or official thereof, including the Colorado Limited Gaming
Control Commission and any other applicable gaming regulatory authority with
authority to regulate any gaming operation (or proposed gaming operation) owned
by the Company or any of its Subsidiaries and managed or operated by Hyatt
Gaming.
11
"Gaming Business" means the gaming business and includes all businesses
either licensed or unlicensed by a Gaming Authority necessary for, incident to
or connected with or arising out of the operation of a gaming establishment or
facility (including developing and operating lodging, retail and restaurant
facilities, sports or entertainment facilities, transportation services or other
related activities or enterprises and any additions or improvements thereto) and
any businesses incident and useful to the gaming business, including, without
limitation, food and beverage distribution operations to the extent that they
are operated in connection with a gaming business.
"Gaming Facility" means any tangible building or other structure used or
expected to be used to enclose space in which a Gaming Business is conducted and
(i) wholly or partially owned, directly or indirectly, by the Company or any
Subsidiary or (ii) any portion or aspect of which is managed or used, or
expected to be managed or used, by the Company or a Subsidiary; provided that
the term Gaming Facility does not include any real property whether or not such
building or other structure is located thereon or adjacent thereto or any
furniture, fixtures and equipment, including gaming equipment, used in
connection with any Gaming Business.
"Gaming Law" means the gaming laws of any jurisdiction or jurisdictions to
which the Company or any of its Subsidiaries is, or may at any time after the
Closing Date, be subject.
"Gaming License" means any license, permit, franchise or other
authorization from any Gaming Authority required on the Closing Date or at any
time thereafter to own, lease, operate or otherwise conduct the Gaming Business
of the Company, including all licenses granted under the Gaming Laws of any
jurisdiction to which the Company or any of its Subsidiaries is, or may at any
time after the Closing Date, be subject.
"Gaming Redemption" means the repurchase or redemption of Capital Stock of
the Company pursuant to Section 2 of the Fifth Article of the Company's First
Amended and Restated Articles of Incorporation, as in effect on the Closing
Date, as the same may be amended from time to time on terms that are no less
favorable to the Holders.
"Gaming Redemption Indebtedness" means Indebtedness that is incurred by the
Company in connection with any Gaming Redemption and that has terms, and is
subordinated in right of payment to the prior payment in full in cash of the
Notes pursuant to terms, approved by the holders of a majority in aggregate
principal amount of the Notes (which approval shall not be unreasonably
withheld).
"Global Note Legend" means the legend set forth in Section 2.06(g)(ii)
hereof, which is required to be placed on all Global Notes issued under this
Indenture.
"Global Notes" means, individually and collectively, each of the Restricted
Global Notes and the Unrestricted Global Notes, substantially in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(iv),
2.06(d)(ii) or 2.06(f) hereof.
12
"Government Securities" means the securities purchased by the Company upon
consummation of the offering and deposited in the Interest Reserve Account and
in which the Trustee has a first priority perfected security interest which are
comprised of (i) direct obligations of the United States of America for the
timely payment of which its full faith and credit is pledged or (ii) obligations
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America, which, in either case, are not callable or redeemable at the
option of the issuer thereof, and shall also include a depository receipt issued
by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as
amended), as custodian with respect to any such Government Security or a
specific payment of principal of or interest on any such Government Security
held by such custodian for the account of the holder of such depository receipt;
provided, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the Government
Security or the specific payment of principal of or interest on the Government
Security evidenced by such depository receipt; provided, however, "Government
Securities" shall include Investment Grade Securities during the three-day
period following the Closing Date.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under: (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements; and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holders" means the record holders from time to time of the Notes.
"Hotel Additional Notes" has the meaning set forth in Section 2.02(b).
"Hotel Project" has the meaning set forth in Section 2.02(b).
"Hyatt Gaming" means Hyatt Gaming Management, Inc.
"Hyatt Gaming Cash Collateral Accounts" means collectively, the Hyatt
Completion Reserve Account and the Hyatt Construction Disbursement Account.
"Hyatt Gaming Completion Reserve Account" means the account to be
maintained by the Disbursement Agent and pledged to Hyatt Gaming pursuant to the
terms of the Cash Collateral and Disbursement Agreement, into which
approximately $0.7 million of the proceeds of the offering of the Second
Mortgage Notes will be deposited.
13
"Hyatt Gaming Construction Disbursement Account" means the account to be
maintained by the Disbursement Agent and pledged to Hyatt Gaming pursuant to the
terms of the Cash Collateral and Disbursement Agreement, into which
approximately $5.2 million of the proceeds of the offering of the Second
Mortgage Notes will be deposited.
"IAI Global Note" means the global Note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of and registered in the name of the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
"Incentive Fee" means the Contingent Incentive Fee (as defined in the
Management Agreement) payable pursuant to Section 4.2(a)(ii) of the Management
Agreement, as in effect on the Closing Date.
"incur" shall have the meaning set forth in Section 4.09.
"Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced by
bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the balance deferred and unpaid of the
purchase price of any property except any such balance that constitutes an
accrued expense or trade payable or representing any Hedging Obligations, if and
to the extent any of the foregoing indebtedness (other than letters of credit,
performance or other surety bonds and Hedging Obligations) would appear as a
liability upon a balance sheet of such Person prepared in accordance with GAAP,
as well as all indebtedness secured by a Lien on any asset of such Person
(whether or not such indebtedness is assumed by such Person) and, to the extent
not otherwise included, the Guarantee by such Person of any indebtedness or
other obligation of any other Person. The amount of any Indebtedness outstanding
as of any date shall be: (i) the accreted value thereof, in the case of any
Indebtedness issued with original issue discount; and (ii) the principal amount
thereof, together with any interest thereon that is more than 30 days past due,
in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Independent Construction Consultant" means the independent construction
consultant retained in connection with the construction of the Black Hawk Casino
or any successor independent construction consultant appointed by the Trustee
pursuant to the terms of the Cash Collateral and Disbursement Agreement.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Initial Notes" means the $100,000,000 aggregate principal amount of Series
A Notes issued under this Indenture on the Closing Date.
14
"Initial Public Offering" means a firm commitment underwritten public
Equity Offering of Capital Stock of the Company pursuant to a registration
statement filed with the Securities and Exchange Commission under the Securities
Act.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Intercreditor Agreement" means the Intercreditor Subordination and
Collateral Agreement dated as of the date hereof by and between the Trustee and
Hyatt Gaming.
"Interest" means the fixed interest of 13% per annum payable on the Notes
semi-annually in arrears on March 15 and September 15 of each year.
"Interest Payment Date" means each March 15 and September 15 or if any such
day is not a Business Day, the next succeeding Business Day.
"Interest Reserve Account" means the account to be maintained by the
Disbursement Agent and pledged to the Trustee pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $24.1 million of
the proceeds of the Offering shall be deposited and used to purchase the
Government Securities.
"Investment Grade Securities" means any Investment in (i) marketable direct
obligations issued or unconditionally guaranteed by the United States Government
or issued by any agency thereof and backed by the full faith and credit of the
United States, in each case maturing within one year from the date of
acquisition thereof, (ii) marketable direct obligations issued by any state of
the United States of America maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from both Standard & Poor's Rating Service and
Xxxxx'x Investors Service, Inc. (or any successor to either of their rating
agency businesses), (iii) commercial paper maturing no more than one year from
the date of creation thereof and, at the time of acquisition, having one of the
two highest ratings obtainable from both Standard & Poor's Rating Service and
Xxxxx'x Investors Service, Inc. (or any successor to either of their rating
agency businesses), (iv) certificates of deposit maturing within one year from
the date of acquisition thereof issued by, or bank accounts maintained with,
commercial banks organized under the laws of the United States of America or any
state thereof or the District of Columbia, each having combined capital and
surplus of not less than $500 million and having a rating of "A1" or better from
Standard & Poor's Rating Service or "P1" or better from Xxxxx'x Investors
Service, Inc. (or any successor to either of their rating agency businesses), or
(v) money market funds organized under the laws of the United States or any
state thereof that invest solely in any of the types of investments permitted
under this definition; provided that any such Investment Grade Securities which
are purchased with a portion of the net proceeds from the sale of the Series A
Notes are deposited in either the Construction Disbursement Account or the
Completion Reserve Account and the Trustee has a first priority perfected
security interest in such Investment Grade Securities.
15
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees or Indebtedness or other
obligations), advances (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), capital
contributions, purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP; provided that an acquisition of assets, Equity Interests
or other securities by the Company for consideration consisting of common Equity
Interests of the Company will not be deemed to be an Investment. If the Company
or any Restricted Subsidiary of the Company sells or otherwise disposes of any
Equity Interests of any direct or indirect Restricted Subsidiary of the Company
such that, after giving effect to any such sale or disposition, such Person is
no longer a Restricted Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Restricted Subsidiary not sold
or disposed of in an amount determined as provided in the final paragraph of
Section 4.07 hereof. The acquisition by the Company or any Restricted Subsidiary
of the Company of a Person that holds an Investment in a third Person shall be
deemed to be an Investment by the Company or such Restricted Subsidiary in such
third Person in an amount equal to the fair market value of the Investment held
by the acquired Person in such third Person in an amount determined as provided
in the final paragraph of Section 4.07 hereof.
"Legal Defeasance" shall have the meaning set forth in Section 8.02.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared by
the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant to
Section 5 of the Registration Rights Agreement.
"Liquor License" means any license, permit, franchise or other
authorization from any Liquor Licensing Authority necessary or required on the
Closing Date or at any time thereafter to own, lease, operate or otherwise
conduct the lodging, retail, restaurant or other entertainment facilities of the
16
Company in the manner described in the Offering Memorandum, including all
licenses granted under the liquor licensing laws of any jurisdiction to which
the Company is, or may at any time after the Closing Date, be subject.
"Liquor Licensing Authority" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States federal or a foreign government, any state, province or any
city or other political subdivision or otherwise, and whether now or hereafter
in existence, or any officer or official thereof, including the Colorado Liquor
Enforcement Division and the City of Black Hawk Liquor Licensing Authority and
any other applicable liquor licensing regulatory authority with authority to
regulate any liquor licensed operation (or proposed liquor licensed operation)
owned by the Company or any of its Subsidiaries and managed or operated by Hyatt
Gaming.
"LLC" means Windsor Woodmont, L.L.C., a Colorado limited liability company.
"Management Agreement" means the Management Agreement dated as of February
2, 2000 between the Company and Hyatt Gaming relating to the management of the
Black Hawk Casino, as amended by the amendment thereto dated as of March 14,
2000.
"Management Fees" means any amounts payable to Hyatt Gaming pursuant to
Section 4.2 of the Management Agreement, including, without limitation, the
Basic Fee and the Incentive Fee.
"Manager Subordination Agreement" means the Non-Disturbance Subordination
and Attornment Agreement dated as of the Closing Date between Hyatt Gaming and
the Trustee and acknowledged and agreed to by the Company.
"Minimum Facilities" means, with respect to the Black Hawk Casino, a casino
which has in operation at least 1,200 slot machines and related amenities
(including a restaurant, buffet restaurant and a bar) and has parking for at
least 700 vehicles.
"Net Income" means, with respect to any Person for any period, the net
income (loss) of such Person for such period, determined in accordance with
GAAP, excluding, however: (i) any gain (but not loss), together with any related
provision for taxes on such gain (but not loss), realized in connection with (a)
any Asset Sale (including, without limitation, dispositions pursuant to sale and
leaseback transactions) or (b) the disposition of any securities by such Person
or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness
of such Person or any of its Restricted Subsidiaries; (ii) any extraordinary or
nonrecurring gain (but not loss), together with any related provision for taxes
on such extraordinary or nonrecurring gain( but not loss); and (iii) solely for
the purpose of calculating the Fixed Charge Coverage Ratio to determine
compliance by the Company with Section 4.07 and Section 4.27, pre-opening
expenses as determined in accordance with GAAP incurred by such Person in
connection with the opening of the Black Hawk Casino up to a maximum of $2.0
million.
17
"Net Loss Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Event of Loss,
including, without limitation, insurance proceeds from condemnation awards or
damages awarded by any judgment, net of the direct costs in recovery of such Net
Loss Proceeds (including, without limitation, legal, accounting, appraisal and
insurance adjuster fees and any relocation expenses incurred as a result
thereof), amounts required to be applied to the repayment of Indebtedness
secured by a Lien on the asset or assets that were the subject of such Event of
Loss, and any taxes paid or payable as a result thereof.
"Net Proceeds" means the aggregate cash proceeds received by the Company or
any of its Subsidiaries in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-cash
consideration received in any Asset Sale), net of the direct costs relating to
such Asset Sale (including, without limitation, legal, accounting and investment
banking fees, and sales commissions) taxes paid or payable as a result thereof
(after taking into account any available tax credits or deductions and any tax
sharing arrangements), amounts required to be applied to the repayment of
Indebtedness (to the extent, in the case of revolving credit Indebtedness, such
Indebtedness is permanently reduced) secured by a Lien on the asset or assets
that were the subject of such Asset Sale and any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP; provided, that the Trustee for the benefit of the Holders will hold a
perfected first priority security interest in such aggregate cash proceeds.
"Non-Recourse Debt" means Indebtedness (i) as to which neither the Company
nor any Restricted Subsidiary (a) provides any guarantee or credit support of
any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness) or (b) is directly or indirectly liable; (ii) no
default with respect to which, including any rights that the holders thereof may
have to take enforcement action against an Unrestricted Subsidiary, would
permit, upon notice, lapse of time or both, any holder of any other Indebtedness
of the Company or any Restricted Subsidiary to declare a default under such
other Indebtedness or cause the payment thereof to be accelerated or payable
prior to its stated maturity; and (iii) as to which the lenders of such
Indebtedness have been notified in writing that they will not have any recourse
to the Equity Interests or assets of the Company or any of its Restricted
Subsidiaries.
"Notes" has the meaning assigned to it in the preamble to this Indenture.
The Initial Notes and the Additional Notes shall be treated as a single class
for all purposes under this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offer Amount" shall have the meaning set forth in Section 3.10.
"Offer Period" shall have the meaning set forth in Section 3.10.
"Offering" means the offering of the Initial Notes by the Company.
18
"Offering Memorandum" means the offering memorandum of the Company relating
to the Series A Notes dated March 7, 2000, as supplemented by a supplement
thereto dated March 14, 2000.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the Company
by two Officers of the Company, one of whom must be the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company, that meets the requirements of Section 11.05
hereof.
"Operating" means, with respect to the Black Hawk Casino, the first time
that: (i) all Gaming Licenses have been granted and have not been revoked or
suspended; (ii) all Liens (other than Liens created by the Collateral Documents
or Permitted Liens) related to the development, construction and equipping of,
and beginning operations at, the Black Hawk Casino have been discharged or, if
payment is not yet due or if such payment is contested in good faith by the
Company, sufficient funds remain in the Cash Collateral Accounts (other than the
Interest Reserve Account) and the Hyatt Gaming Cash Collateral Accounts to
discharge such Liens and the Company has taken any action (including the
institution of legal proceedings) necessary to prevent the sale of any or all of
the Black Hawk Casino or the real property on which the Black Hawk Casino will
be constructed; (iii) the Independent Construction Consultant, the general
contractor and the architect of the Black Hawk Casino will have delivered a
certificate to the Trustee certifying that the Black Hawk Casino is
substantially complete in all material respects in accordance with the Final
Plans with respect to the Minimum Facilities and all applicable building and
other laws, ordinances and regulations; (iv) the Black Hawk Casino is in a
condition (including installation of furnishings, fixtures and equipment) to
receive customers in the ordinary course of business; (v) the Minimum Facilities
are open to the general public and operating in accordance with all applicable
laws; and (vi) a temporary certificate of occupancy has been issued for the
Black Hawk Casino by the appropriate governmental authorities.
"Operating Deadline" means December 31, 2001.
"Operating Year" means the four consecutive fiscal quarter period of the
Company beginning on the first day of the first fiscal quarter of the Company
commencing after the date that the Black Hawk Casino first becomes Operating,
and each succeeding four consecutive fiscal quarter period thereafter that
begins immediately after the last day of such initial four quarter period or any
subsequent four quarter period.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 11.05 hereof.
The counsel may be an employee of or counsel to the Company, any Subsidiary of
the Company or the Trustee.
19
"Outside Completion Date" shall have the meaning set forth in the
Subdivision Agreement.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Cedel).
"Paying Agent" shall have the meaning set forth in Section 2.03.
"Permitted Debt" shall have the meaning set forth in Section 4.09.
"Permitted Investments" means: (i) any Investment in Cash Equivalents; (ii)
any Restricted Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.10 hereof; (iii) any acquisition of assets solely in exchange for
the issuance of Equity Interests (other than Disqualified Stock) of the Company;
(iv) after the Black Hawk Casino is Operating, any purchases from time to time
by the Company of Notes in accordance with Section 4.29; (v) Equity Interests,
obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in the settlement of judgments; and (vi) advances to employees of
the Company or any of its Restricted Subsidiaries in the ordinary course of
business to pay for reasonable business expenses incurred by such employees.
"Permitted Liens" means (i) Liens on property of a Person existing at the
time such Person is merged into or consolidated with the Company or any
Restricted Subsidiary of the Company in accordance with the terms hereof;
provided that such Liens were not created in contemplation of such merger or
consolidation and do not extend to any assets other than those of the Person
merged into or consolidated with the Company; (ii) Liens on property existing at
the time of acquisition thereof by the Company or any Restricted Subsidiary of
the Company in accordance with the terms hereof (other than materials, supplies
or FF&E acquired in connection with developing, constructing or equipping of, or
commencing operations at, the Black Hawk Casino), provided that such Liens were
in existence prior to the contemplation of such acquisition; (iii) Liens
existing on the Closing Date and previously disclosed in the Title Commitment
for the Deed of Trust; (iv) Liens for taxes, assessments or governmental charges
or claims that are not yet delinquent or that are being contested in good faith
by appropriate proceedings promptly instituted and diligently concluded;
provided that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor; (v) statutory Liens of
landlords and carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen or other like Liens arising in the ordinary course of business and
with respect to amounts not yet delinquent or being contested in good faith by
an appropriate process of law, and for which a reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made, and, with
respect to such Liens arising in connection with the construction of the Black
Hawk Casino, there is no Default of Event of Default under the Cash Collateral
and Disbursement Agreement; (vi) Liens created pursuant to the terms of the
Second Mortgage Notes on property that constitutes Collateral on which the
Trustee has a valid, perfected and, except as otherwise permitted by the terms
hereof and the Collateral Documents, first priority Lien or pursuant to any
Permitted Refinancing Indebtedness incurred in accordance with this Indenture to
20
extend, refinance, renew, replace, defease or refund the Second Mortgage Notes,
so long as such Liens do not extend to property that was not covered by the
Second Mortgage Notes; (vii) Liens on FF&E to secure Indebtedness incurred in
accordance with clause (ix) of the definition of Permitted Debt in Section 4.09;
(viii) liens securing obligations under this Indenture or the Notes; (ix)
pledges or deposits in the ordinary course of business to secure lease
obligations or nondelinquent obligations under workers' compensation,
unemployment insurance or similar legislation; (x) zoning, easements,
rights-of-way, restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect with the
business or assets of the Company or any Subsidiary incurred in the ordinary
course of business; (xi) Liens on the real property encumbered by the Deed of
Trust to secure Indebtedness incurred in accordance with clause (vi) of the
definition of Permitted Debt in Section 4.09; (xii) Liens on Collateral to
secure Indebtedness incurred in accordance with clause (xv) of the definition of
Permitted Debt in Section 4.09; provided (a) such Liens are not senior to the
Liens securing the Obligations hereunder and under the Notes and the other
Collateral Documents and (b) such Indebtedness is not senior in right of payment
to such Obligations; (xiii) leases or subleases granted to their Persons not
materially interfering with the ordinary course of business of the Company or
any of its Restricted Subsidiaries; (xiv) Liens securing Hedging Obligations
incurred in accordance with the terms hereof; (xv) attachment or judgment Liens
not giving rise to a Default or an Event of Default; and (xvi) Liens on Capital
Stock of an Unrestricted Subsidiary owned directly by another Unrestricted
Subsidiary to secure Indebtedness of such Unrestricted Subsidiary the Capital
Stock of which is being provided as a security; provided that any such Lien may
not extend to any property or assets of the Company or any of its Restricted
Subsidiaries other than such Capital Stock.
"Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that: (i) the principal amount
(or accreted value, if applicable) of such Permitted Refinancing Indebtedness
does not exceed the lesser of (a) the original principal amount of (or accreted
value, if applicable) the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus all accrued interest thereon, the amount of
reasonable expenses incurred in connection therewith and premiums incurred in
connection therewith pursuant to the original loan documents governing such
indebtedness) and (b) to the extent such Indebtedness is secured by a Lien
described in clause (vii) of the definition of Permitted Liens above, the then
current fair market value of the asset so encumbered; (ii) such Permitted
Refinancing Indebtedness has a final maturity date no earlier than the final
maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
is subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date no earlier than the final maturity date
of and is subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and (iv) such Indebtedness is incurred by the Company or by the
21
Restricted Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means an individual, partnership, limited liability company,
corporation, trust or unincorporated organization and a government agency or a
political subdivision thereof.
"Plans" means the plans, specifications, working drawings, change orders,
correspondence and related items, which may be amended by the Company, as the
case may be, as necessary or appropriate, that collectively: (i) provide for and
detail the manner of development, construction and equipping of the Black Hawk
Casino; (ii) call for construction which shall permit the Black Hawk Casino to
be Operating on or prior to the Operating Deadline, subject only to Permitted
Liens; and (iii) call for construction which shall cause the Black Hawk Casino
to be Operating for a total cost consistent with its Construction Disbursement
Budget (as defined in the Cash Collateral and Disbursement Agreement) and the
line items set forth therein; and (iv) together with any amendments, are
consistent with the description of the Black Hawk Casino contained in the
Offering Memorandum, and are consistent with all governmental approvals and
requirements, including, without limitation, the Black Hawk Building Department,
Historical Architecture Review Commission, Gaming Authorities, and the
Subdivision Agreement.
"Private Placement Legend" means the legend set forth in Section 2.06(g)(i)
hereof to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Purchase Date" shall have the meaning set forth in Section 3.10.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Record Date" means the March 1 or September 1 immediately preceding an
Interest Payment Date, as applicable.
"Registrar" shall have the meaning set forth in Section 2.03.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of the Closing Date, among the Company and the other parties named on
the signature pages thereof, as such agreement may be amended, modified or
supplemented from time to time and, with respect to any Additional Notes, one or
more registration rights agreements between the Company and the other parties
thereto, as such agreement(s) may be amended, modified or supplemented from time
to time, relating to rights given by the Company to the purchasers of Additional
Notes to register such Additional Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note or
Regulation S Permanent Global Note, as appropriate.
22
"Regulation S Permanent Global Note" means a permanent global Note in the
form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note in the
form of Exhibit A2 hereto bearing the Private Placement Legend and deposited
with or on behalf of and registered in the name of the Depositary or its
nominee, issued in a denomination equal to the outstanding principal amount of
the Notes initially sold in reliance on Rule 903 of Regulation S.
"Related Party" means (i) Windsor Woodmont, LLC, and (ii) Xxxxxx X.
Xxxxxxxxxx, Normandy, Inc., Xxxxxx Xxxx and Xxxxxxxx Xxxx and any trust formed
for the benefit of such individual, his/her spouse or his/her children or any
corporation, partnership, or limited liability company that is at least 50%
owned by such individuals.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private Placement
Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payments" shall have the meaning set forth in Section 4.07.
"Restricted Period" means the 40-day restricted period as defined in
Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of such Person
that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Second Mortgage Notes" means the $7.5 million of subordinated secured
Indebtedness issued to Hyatt Gaming on the Closing Date.
23
"Securities Act" means the Securities Act of 1933, as amended.
"Semiannual Period" means each period that begins on March 15 and ends on
the next succeeding September 14 or each period that begins on September 15 and
ends on the next succeeding March 14.
"Series A Preferred Stock" means the Company's Series A Preferred Stock,
par value $.01 per share.
"Shelf Registration Statement" means the Shelf Registration Statement as
defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the Closing
Date.
"Sponsor" means Xxxxxx X. Xxxxxxxxxx.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subdivision Agreement" means the Subdivision Agreement dated December 29,
1997 between the Company and the City of Black Hawk, Colorado.
"Subsidiary" means with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or one or more Subsidiaries
of such Person (or any combination thereof).
"Subsidiary Guarantee" means the Guarantee by a Subsidiary of the Company's
payment obligations under this Indenture and on the Notes, executed pursuant to
the provisions of this Indenture.
"Subsidiary Guarantor" means any Subsidiary that executes a Subsidiary
Guarantee in accordance with the provisions of the Indenture, and its respective
successors and assigns.
24
"Subsidiary Intercompany Notes" means the intercompany notes senior to any
subordinated debt of, and pari passu with all existing senior Indebtedness of
the issuing Subsidiary, issued by Restricted Subsidiaries of the Company in
favor of the Company to evidence advances by the Company, in each case, in the
form attached as Exhibit H to this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ssss77aaa-77bbbb) as
in effect on the date on which this Indenture is qualified under the TIA.
"Trustee" means the party named as such above until a successor replaces it
in accordance with the applicable provisions of this Indenture and thereafter
means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive Notes that do
not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global Note substantially in
the form of Exhibit A attached hereto that bears the Global Note Legend and that
has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution, but only to the extent that such Subsidiary: (i) has no Indebtedness
other than Non-Recourse Debt; (ii) is not party to any agreement, contract,
arrangement or understanding with the Company or any Restricted Subsidiary of
the Company unless the terms of any such agreement, contract arrangement or
understanding are no less favorable to the Company or such Restricted Subsidiary
than those that might be obtained at the time from Persons who are not
Affiliates of the Company; (iii) is a Person with respect to which neither the
Company nor any of its Restricted Subsidiaries has any direct or indirect
obligation (a) to subscribe for additional Equity Interests or (b) to maintain
or preserve such Person's financial condition or to cause such Person to achieve
any specified levels operating results;(iv) has not guaranteed or otherwise
directly or indirectly provided credit support for any Indebtedness of the
Company or any of its Restricted Subsidiaries; and (v) has at least one director
on its board of directors that is not a director or executive officer of the
Company or any of its Restricted Subsidiaries and has at least one executive
officer that is not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07 hereof. If, at any time,
any Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
25
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09, the Company shall be in default of
such covenant. The Board of Directors of the Company may at any time designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (i) such
Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma
basis as if such designation had occurred at the beginning of the four-quarter
reference period; and (ii) no Default of Event of Default would be in existence
following such designation, (iii) such Subsidiary becomes a Subsidiary
Guarantor; and (iv) such Subsidiary becomes a party to all Collateral Documents.
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that shall elapse
between such date and the making of such payment by (ii) the then outstanding
principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Wholly Owned
Subsidiary of such Person that is also a Restricted Subsidiary of such Person.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
at least 90% of the outstanding Capital Stock or other ownership interests of
which will at the time be owned by such Persons by one or more Wholly Owned
Subsidiaries of such Person, or by such Person and one or more Wholly Owned
Subsidiaries of such Person.
Section 1.02 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor
upon the Notes.
26
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.03. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it
in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural include the
singular;
(e) provisions apply to successive events and transactions; and
(f) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement of successor sections or rules adopted
by the SEC from time to time.
ARTICLE 2.
THE NOTES
---------
Section 2.01 Form and Dating
---------------
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Indenture and the Company and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend thereon and
the "Schedule of Exchanges of Interests in the Global Note" attached thereto).
Notes issued in definitive form shall be substantially in the form of Exhibit A
attached hereto (but without the Global Note Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Note" attached thereto). Each
Global Note shall represent such of the outstanding Notes as shall be specified
27
therein and each shall provide that it shall represent the aggregate principal
amount of outstanding Notes from time to time endorsed xxxxxxx and that the
aggregate principal amount of outstanding Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby shall be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of the Regulation S Temporary
Global Note, which shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Clearstream, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The Restricted Period shall be terminated upon
the receipt by the Trustee of (i) a written certificate from the Depositary,
together with copies of certificates from Euroclear and Clearstream certifying
that they have received certification of non-United States beneficial ownership
of 100% of the aggregate principal amount of the Regulation S Temporary Global
Note (except to the extent of any beneficial owners thereof who acquired an
interest therein during the Restricted Period pursuant to another exemption from
registration under the Securities Act and who will take delivery of a beneficial
ownership interest in a 144A Global Note or an IAI Global Note bearing a Private
Placement Legend, all as contemplated by Section 2.06(a)(ii) hereof), and (ii)
an Officers' Certificate from the Company. Following the termination of the
Restricted Period, beneficial interests in the Regulation S Temporary Global
Note shall be exchanged for beneficial interests in Regulation S Permanent
Global Notes pursuant to the Applicable Procedures. Simultaneously with
authentication of Regulation S Permanent Global Notes, the Trustee shall cancel
the Regulation S Temporary Global Note. The aggregate principal amount of the
Regulation S Temporary Global Note and the Regulation S Permanent Global Notes
may from time to time be increased or decreased by adjustments made on the
records of the Trustee and the Depositary or its nominee, as the case may be, in
connection with transfers of interest as hereinafter provided.
(d) Euroclear and Clearstream Procedures Applicable. The provisions of the
"Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream shall be applicable to
transfers of beneficial interest in the Regulation S Temporary Global Note and
the Regulation S Permanent Global Notes that are held by Participants through
Euroclear or Clearstream.
Section 2.02 Execution and Authentication
----------------------------
(a) An Officer shall sign the Notes for the Company by manual or facsimile
signature. If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid. A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature shall be conclusive evidence that the Note has
28
been authenticated under this Indenture. The Trustee shall, upon a written order
of the Company signed by an Officer (an "Authentication Order"), authenticate
Notes for original issue up to the aggregate principal amount stated in
paragraph 4 of the Notes. The aggregate principal amount of Notes outstanding at
any time may not exceed such amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Notes. An authenticating agent may authenticate Notes whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with Holders or an Affiliate of the Company.
(b) The Notes shall be limited to an aggregate principal amount of $135.0
million, $100.0 million of which shall be issued on the Closing Date. The
Company shall only be permitted to issue up to an additional $35.0 million
aggregate principal amount of Additional Notes under this Indenture, from time
to time after the Closing Date, as follows: (1) up to $5.0 million of Additional
Notes may be issued to The Ravich Revocable Trust of 1989 or Affiliates of the
foregoing solely to finance the completion of the development, construction and
initial equipment of the Black Hawk Casino prior to the Operating of the Black
Hawk Casino in accordance with clause (xv) of the definition of Permitted Debt
in Section 4.09 hereof; and (2) up to $30.0 million of Additional Notes (the
"Hotel Additional Notes") may be issued solely for the purpose of financing the
construction of a hotel, parking structure and related facilities at the Black
Hawk Casino or on the property owned by the Company in Black Hawk, Colorado
(collectively, the "Hotel Project") in accordance with Section 4.09 hereof. The
Initial Notes, the Exchange Notes and any Additional Notes subsequently issued
under this Indenture would be treated as a single class for all purposes under
this Indenture, including without limitation, waivers, amendments, redemptions
and offers to purchase.
Section 2.03. Registrar and Paying Agent
--------------------------
The Company shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may appoint one or more co-registrars and one or more additional paying
agents. The term "Registrar" includes any co-registrar and the term "Paying
Agent" includes any additional paying agent. The Company may change any Paying
Agent or Registrar without notice to any Holder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar. The Company initially
appoints The Depository Trust Company ("DTC") to act as Depositary with respect
to the Global Notes. The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.
29
Section 2.04. Paying Agent to Hold Money in Trust
-----------------------------------
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent shall hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of principal,
premium or Liquidated Damages, if any, or Interest on the Notes, and shall
notify the Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require a Paying Agent to pay
all money held by it to the Trustee. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall
have no further liability for the money. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent.
Section 2.05. Holder Lists
------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss 312(a). If the Trustee is not
the Registrar, the Company shall furnish to the Trustee at least seven Business
Days before each Interest Payment Date and at such other times as the Trustee
may request in writing, a list in such form and as of such date as the Trustee
may reasonably require of the names and addresses of the Holders of Notes and
the Company shall otherwise comply with TIA ss 312(a).
Section 2.06. Transfer and Exchange
---------------------
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 120 days after the date of such notice from the Depositary or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee; provided that in no event shall
the Regulation S Temporary Global Note be exchanged by the Company for
Definitive Notes prior to (x) the expiration of the Restricted Period and (y)
the receipt by the Registrar of any certificates required pursuant to Rule
903(c)(3)(ii)(B) under the Securities Act. Upon the occurrence of either of the
preceding events in (i) or (ii) above, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for
30
another Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i) or (ii) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Restricted Period, transfers of
beneficial interests in the Regulation S Temporary Global Note may not be
made to a U.S. Person or for the account or benefit of a U.S. Person.
Beneficial interests in any Unrestricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
an Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers described
in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor
of such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to cause
to be issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given by the
Depositary to the Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the transfer
or exchange referred to in (1) above; provided that in no event shall
Definitive Notes be issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of
any certificates required pursuant to Rule 903 under the Securities Act.
Upon consummation of an Exchange Offer by the Company in accordance with
Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall
be deemed to have been satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal delivered by the Holder
of such beneficial interests in the Restricted Global Notes (which
instructions may be delivered by electronic
31
transmission in accordance with the Applicable Procedures). Upon
satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities Act, the Trustee shall
adjust the principal amount of the relevant Global Note(s) pursuant to
Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Temporary Global Note or the
Regulation S Permanent Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications and certificates of Opinion of Counsel required by item
(3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal (or pursuant to
instructions delivered by electronic transmission in accordance with
the Applicable Procedures) that it is not (1) a broker-dealer, (2) a
Person participating in the distribution of the Exchange Notes or (3)
a Person who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
32
(C) such transfer is effected by a Broker-Dealer pursuant to the
Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the Registrar
so requests or if the Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that
such exchange or transfer is in compliance with the Securities Act and that
the restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D) above
at a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to subparagraph (B) or (D)
above. Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
33
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904 under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (2)
thereof;
(D) if such beneficial interest is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof; or
(G) if such beneficial interest is being transferred pursuant to
an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Definitive Note in
the appropriate principal amount. Any Definitive Note issued in exchange
for a beneficial interest in a Restricted Global Note pursuant to this
Section 2.06(c) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the
Depositary and the Participant or Indirect Participant. The Trustee shall
deliver such Definitive Notes to the Persons in whose names such Notes are
so registered. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c)(i)
shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interest in Regulation S Temporary Global Note to
Definitive Notes. Notwithstanding Section 2.06(c)(i)(A) and (C) hereof, a
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Definitive Note or
34
transferred to a Person who takes delivery thereof in the form of a
Definitive Note prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates required pursuant to
Rule 903(c)(3)(ii)(B) under the Securities Act, except in the case of a
transfer pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (1) a broker-
dealer, (2) a Person participating in the distribution of the Exchange
Notes or (3) a Person who is an affiliate (as defined in Rule 144) of
the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the
Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the Registrar
so requests or if the Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that
such exchange or transfer is in compliance with the Securities
35
Act and that the restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a Definitive
Note or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause
the aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company shall
execute and the Trustee shall authenticate and deliver to the Person
designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iv) shall be registered in such
name or names and in such authorized denomination or denominations as the
holder of such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons
in whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iv)
shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred
to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred
to a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904 under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of
36
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred
to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D)
above, a certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being transferred
to the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount of, in the case
of clause (A) above, the appropriate Restricted Global Note, in the
case of clause (B) above, the 144A Global Note, in the case of clause
(C) above, the Regulation S Global Note and in all other cases, the
IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Definitive Note to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
37
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications
in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit B hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange
or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs
in this Section 2.06(d)(ii), the Trustee shall cancel the Definitive
Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B),
(ii)(D) or (iii) above at a time when an Unrestricted Global Note has
not yet been issued, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee shall authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of Definitive
Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register
the transfer or exchange of Definitive Notes. Prior to such registration of
transfer or exchange, the requesting Holder shall present or surrender to
the Registrar the Definitive Notes duly endorsed or accompanied by a
written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by its attorney, duly authorized in writing.
38
In addition, the requesting Holder shall provide any additional
certifications, documents and information, as applicable, required pursuant
to the following provisions of this Section 2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes.
Any Restricted Definitive Note may be transferred to and registered in
the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof; and
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person
or Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from
39
such Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit
B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such
exchange or transfer is in compliance with the Securities
Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate (i) one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount
of the beneficial interests in the Restricted Global Notes tendered for
acceptance by Persons that certify in the applicable Letters of Transmittal
that (x) they are not broker-dealers, (y) they are not participating in a
distribution of the Exchange Notes and (z) they are not affiliates (as
defined in Rule 144) of the Company, and accepted for exchange in the
Exchange Offer and (ii) Definitive Notes in an aggregate principal amount
equal to the principal amount of the Restricted Definitive Notes accepted
for exchange in the Exchange Offer. Concurrently with the issuance of such
Notes, the Trustee shall cause the aggregate principal amount of the
applicable Restricted Global Notes to be reduced accordingly, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Persons designated by the Holders of Definitive Notes so accepted
Definitive Notes in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this
Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
40
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE 'ACT'), AND, ACCORDINGLY, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS,
EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE ACT)
(A "QIB"), (ii) IT HAS ACQUIRED THIS SECURITY IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE ACT OR
(iii) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501 (a)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE ACT (AN "IAI")); OR (iv) IT HAS ACQUIRED THIS
SECURITY IN COMPLIANCE WITH CLAUSE (vi) OF THE NEXT
PARAGRAPH;
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (i) TO THE COMPANY OR ANY OF
ITS SUBSIDIARIES, (ii) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A UNDER THE ACT, (iii) IN AN
OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
904 OF THE ACT, (iv) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE ACT, (v) TO AN IAI THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE UNDER THE
INDENTURE WITH A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF
THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM SUCH
TRUSTEE) AND, AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE ACT,
(vi) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (vii)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS SECURITY OR AN INTEREST XXXXXX IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
41
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED
STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION
S UNDER THE ACT. THE INDENTURE AND THE WARRANT AGREEMENT EACH
CONTAIN A PROVISION REQUIRING THE TRUSTEE OR WARRANT AGENT, AS
APPROPRIATE, TO REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY
AND ALL SECURITIES ISSUED IN EXCHANGE THEREFORE, IN SUBSTITUTION
THEREOF OR UPON CONVERSION THEREOF IN VIOLATION OF THE
FOREGOING."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv),
(c)(iii), (c)(iv), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to
this Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE
TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE
MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY."
(iii) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note shall bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE,
AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR
CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED
HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS
REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE
PAYMENT OF INTEREST HEREON.
42
(h) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note
shall be returned to or retained and canceled by the Trustee in accordance
with Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for or transferred to a
Person who shall take delivery thereof in the form of a beneficial interest
in another Global Note or for Definitive Notes, the principal amount of
Notes represented by such Global Note shall be reduced accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such reduction; and
if the beneficial interest is being exchanged for or transferred to a
Person who shall take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased
accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect
such increase.
(i) General Provisions Relating to Transfers and Exchanges. (i) To
permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Global Notes and Definitive Notes upon
the Company's order or at the Registrar's request.
(i) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any
such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.10, 4.10,
4.28, 4.29 and 9.05 hereof and any reasonable charges of the
Registrar).
(ii) The Registrar shall not be required to register the transfer
of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(iii) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(iv) The Company shall not be required (A) to issue, to register
the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of
Notes for redemption under Section 3.02 hereof and ending at the close
of business on the day of selection, (B) to register the transfer of
or to exchange any Note so selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part
or (C) to register the transfer of or to exchange a Note between a
Record Date and the next succeeding Interest Payment Date.
43
(v) Prior to due presentment for the registration of a transfer
of any Note, the Trustee, any Agent and the Company may deem and treat
the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
Interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Company shall be affected by notice to the
contrary.
(vi) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
(vii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be submitted
by facsimile.
Section 2.07. Replacement Notes
-----------------
If any mutilated Note is surrendered to the Trustee or the Company and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note. Every
replacement Note is an additional obligation of the Company and shall be
entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes
-----------------
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section as
not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note; however, Notes held by the Company or a Subsidiary of the Company
shall not be deemed to be outstanding for purposes of Section 3.07(b) hereof. If
a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Note is
held by a bona fide purchaser. If the principal amount of any Note is considered
paid under Section 4.01 hereof, it ceases to be outstanding and Interest on it
ceases to accrue. If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
Interest.
44
Section 2.09. Treasury Notes
--------------
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10. Temporary Notes
---------------
Until certificates representing Notes are ready for delivery, the Company
may prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form
of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes. Holders of
temporary Notes shall be entitled to all of the benefits of this Indenture.
Section 2.11. Cancellation
-------------
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
Section 2.12. Defaulted Interest
------------------
If the Company defaults in a payment of Interest on the Notes, it shall pay
the defaulted Interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted Interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted Interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
Interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
Interest to be paid.
45
Section 2.13. CUSIP Number
------------
The Company in issuing the Notes may use a "CUSIP" number and if so the
Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders, provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Notes and that reliance may be placed only on
the other identification numbers printed on the Notes. The Company shall
promptly notify the Trustee of any change in the CUSIP number.
Section 2.14. Exchange Registration
---------------------
In the event that the Company delivers to the Trustee a copy of an order of
effectiveness or a certification of the Company with respect to such
effectiveness with respect to the Exchange Offer, the Trustee shall, at the
Company's expense, notify the Holders of the receipt of such order of
effectiveness or certification and upon the request of any Holder shall exchange
such Holder's Notes upon the terms set forth in the Exchange Offer.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
-------------------------
Section 3.01 Notices to Trustee
------------------
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 30
days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed
---------------------------------
If less than all of the Notes are to be redeemed at any time, the Trustee
will select Notes for redemption as follows: (i) if the Notes are listed, in
compliance with the requirements of the principal national securities exchange
on which the Notes are listed on any exchange; or (ii) if the Notes are not so
listed, on a pro rata basis, by lot or by such method as the Trustee shall deem
fair and appropriate. No Notes of $1,000 or less shall be redeemed in part.
Notices of redemption shall be mailed by first class mail at least 30 but not
more than 60 days before the redemption date (except in the case of redemption
pursuant to Section 3.09) to each Holder of Notes to be redeemed at its
registered address. Notices of redemption may not be conditional. If any Note is
to be redeemed in part only, the notice of redemption that relates to that Note
shall state the portion of the principal amount thereof to be redeemed. A new
Note in principal amount equal to the unredeemed portion of the original Note
will be issued in the name of the Holder thereof upon cancellation of the
original Note. Notes called for redemption become due on the date fixed for
redemption. On and after the redemption date, Interest ceases to accrue on Notes
or portions of them called for redemption.
46
Section 3.03. Notice of Redemption
--------------------
Subject to the provisions of Section 3.09 hereof, at least 30 days but not
more than 60 days before a redemption date, the Company shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
Interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and (h) that no
representation is made as to the correctness or accuracy of the CUSIP number, if
any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense; provided, however, that the Company
shall have delivered to the Trustee, at least 45 days prior to the redemption
date (except in the case of redemption pursuant to Section 3.09), an Officers'
Certificate requesting that the Trustee give such notice and setting forth the
information to be stated in such notice as provided in the preceding paragraph.
Section 3.04. Effect of Notice of Redemption
------------------------------
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
47
Section 3.05. Deposit of Redemption Price
---------------------------
One Business Day prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued Interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, and accrued Interest on, all
Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, Interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after a
Record Date but on or prior to the related Interest Payment Date, then any
accrued and unpaid Interest shall be paid to the Person in whose name such Note
was registered at the close of business on such Record Date. If any Note called
for redemption shall not be so paid upon surrender for redemption because of the
failure of the Company to comply with the preceding paragraph, Interest shall be
paid on the unpaid principal, from the redemption date until such principal is
paid, and to the extent lawful on any Interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
Section 3.06. Notes Redeemed in Part
----------------------
Upon surrender of a Note that is redeemed in part, the Company shall issue
and, upon the Company's written request, the Trustee shall authenticate for the
Holder at the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption
-------------------
(a) Except as set forth in clause (b) of this Section 3.07, the Company
shall not have the option to redeem the Notes pursuant to this Section 3.07
prior to March 15, 2002. Thereafter, the Company may redeem all or a part of the
Notes upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid Interest and Liquidated Damages thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on March 15 of the years indicated below:
Year Percentage
---- ----------
2002........................................... 113.000%
2003........................................... 108.666%
2004 .......................................... 104.333%
2005 (maturity) ............................... 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section 3.07, at
any time prior to March 15, 2002, the Company may redeem up to 35% of the
aggregate principal amount of Notes at a redemption price of 113% of the
principal amount thereof, plus accrued and unpaid Interest and Liquidated
48
Damages, if any, to the redemption date, with the net cash proceeds of an Equity
Offering; provided that (i) at least 65% in aggregate principal amount of the
Notes issued under this Indenture remains outstanding immediately after the
occurrence of such redemption excluding Notes held by the Company and its
Subsidiaries and (ii) the redemption must occur within 60 days of the date of
the closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
Section 3.08 Mandatory Redemption
--------------------
Except as set forth under Sections 3.09, 4.10, 4.28 and 4.29 hereof or
acceleration under Section 6.02 hereof, the Company shall not be required to
make mandatory redemption or sinking fund payments with respect to the Notes.
Section 3.09. Gaming Redemption
-----------------
Notwithstanding any other provision of this Indenture, if any Gaming
Authority requires that a Holder or beneficial owner of Notes must be licensed,
qualified or found suitable under any applicable gaming law and such Holder or
beneficial owner fails to apply for a license, qualification or finding of
suitability within 30 days after being requested to do so by such Gaming
Authority (or such lesser period that may be required by such Gaming Authority),
or if such Holder or such beneficial owner is notified by such Gaming Authority
that such Holder or beneficial owner shall not be so licensed, qualified or
found suitable, the Company shall have the right, at its option, (i) to require
such Holder or beneficial owner to dispose of such Holder's or beneficial
owner's Notes within 30 days (or such lesser period as may be required by such
Gaming Authority) of (a) the termination of the period described above for such
Holder or beneficial owner to apply for a license, qualification or finding or
suitability or (b) receipt of the notice from such Gaming Authority that such
Holder or beneficial owner shall not be licensed, qualified or found suitable by
such Gaming Authority or (ii) to redeem the Notes of such Holder or beneficial
owner at a redemption price equal to the lesser of the principal amount thereof
or the price at which such Holder or beneficial owner acquired such Notes,
together with, in either case, accrued and unpaid Interest and Liquidated
Damages, if any, thereon to the earlier of the date of redemption or such
earlier date as may be required by such Gaming Authority or the date of the
finding of unsuitability by such Gaming Authority, which may be less than 30
days following the notice of redemption, if so ordered by such Gaming Authority.
Immediately upon a determination by a Gaming Authority that a Holder or
beneficial owner of Notes shall not be licensed, qualified or found suitable by
such Gaming Authority, such Holder or beneficial owner shall have no further
rights with respect to the Notes (i) to exercise, directly or indirectly,
through any trustee, nominee or any other Person, any right conferred by the
Notes and (ii) to receive any Interest or any other distribution or payment with
respect to the Notes, or any remuneration in any form from the Company for
services rendered or otherwise, except the redemption price of the Notes. Under
this Indenture, the Company is not required to pay or reimburse any Holder or
beneficial owner of Notes who is required to apply for such license,
qualification or finding of suitability for the costs of the licensor or
49
investigation for such qualification or finding of suitability. The Company
shall not be required to pay or reimburse any Holder or beneficial owner of
Notes who is required to apply for such license, qualification or finding of
suitability for the costs relating thereto. Such expense shall, therefore, be
the obligation of such Holder or beneficial owner.
Section 3.10. Offer to Purchase by Application of Excess Proceeds
---------------------------------------------------
In the event that, pursuant to Section 4.10, 4.28 and 4.29 hereof, the
Company shall be required to commence an offer to all Holders to purchase Notes
(an "Asset Sale Offer," an "Event of Loss Offer" or an "Excess Cash Purchase
Offer," respectively, and each of which is referred to herein as an "Excess
Proceeds Offer"), it shall follow the applicable procedures specified below. The
Excess Proceeds Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law or permitted by another applicable
provision of this Indenture (the "Offer Period"). No later than five Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company shall purchase the principal amount of Notes required to be purchased
pursuant to Section 4.10, 4.28 or 4.29 hereof (the "Offer Amount") or, if less
than the Offer Amount has been tendered, all Notes tendered in response to the
Excess Proceeds Offer. Payment for any Notes so purchased shall be made in the
same manner as Interest payments are made.
If the Purchase Date is on or after a Record Date and on or before the
related Interest Payment Date, any accrued and unpaid Interest shall be paid to
the Person in whose name a Note is registered at the close of business on such
Record Date, and no additional Interest shall be payable to Holders who tender
Notes pursuant to the Excess Proceeds Offer.
Upon the commencement of an Excess Proceeds Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Excess Proceeds
Offer. The Excess Proceeds Offer shall be made to all Holders. The notice, which
shall govern the terms of the Excess Proceeds Offer, shall state:
(a) that the Excess Proceeds Offer is being made pursuant to this Section
3.10 and either Section 4.10, 4.28 or 4.29 hereof and the length of time the
Excess Proceeds Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrete or accrue Interest;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Excess Proceeds Offer shall cease to
accrete or accrue Interest after the Purchase Date;
50
(e) that Holders electing to have a Note purchased pursuant to an Excess
Proceeds Offer may elect to have Notes purchased in integral multiples of $1,000
only;
(f) that Holders electing to have a Note purchased pursuant to any Excess
Proceeds Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Xxxxxx is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by Holders
exceeds the Offer Amount, the Trustee shall select the Notes to be purchased on
a pro rata basis (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000, or integral multiples
thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Excess Proceeds
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.10. The Company, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company shall promptly issue a new Note, and
the Trustee, upon written request from the Company shall authenticate and mail
or deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Excess Proceeds Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.10, any purchase
pursuant to this Section 3.10 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
51
ARTICLE 4.
COVENANTS
---------
Section 4.01. Payment of Notes
----------------
The Company shall pay or cause to be paid the principal of, premium, if
any, and Interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and Interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and Interest then due. The Company shall pay all
Liquidated Damages, if any, in the same manner on the dates and in the amounts
set forth in the Registration Rights Agreement. If a Holder has given wire
transfer instructions to the Company, the Company will pay all principal,
Interest, premium and Liquidated Damages, if any, on that Holder's Notes in
accordance with those instructions. All other payments on Notes shall be made at
the office or agency of the Paying Agent and Registrar within the City and State
of New York unless the Company elects to make Interest payments by check mailed
to the Holders at their addresses set forth in the register of Holders.
Section 4.02. Maintenance of Office or Agency
-------------------------------
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
the City of New York for such purposes. The Company shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
the only office or agency of the Company in accordance with Section 2.03 hereof.
52
Section 4.03. Reports
-------------
(a) Whether or not required by the rules and regulations of the SEC,
beginning with respect to the Company's fiscal quarter ended March 31, 2000 and
continuing for so long as any Notes are outstanding, the Company shall furnish
to the Holders of Notes (i) all consolidated quarterly and annual financial
information that would be required to be contained in a filing with the SEC on
Forms 10-Q and 10-K if the Company were required to file such forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" that describes the financial position and results of operations of
the Company and its Subsidiaries and, with respect to the annual information
only, a report thereon by the Company's certified independent accountants and
(ii) all current reports that would be required to be filed with the SEC on Form
8-K if the Company were required to file such reports, in each case, within the
time periods specified in the SEC's rules and regulations. If the Company has
designated any of its Subsidiaries as Unrestricted Subsidiaries, then the
quarterly and annual financial information required by the preceding paragraph
shall include a reasonably detailed presentation, either on the face of the
financial statements or in the footnotes thereto, and in Management's Discussion
and Analysis of Financial Condition and Results of Operations, of the financial
condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of
the Unrestricted Subsidiaries of the Company. In addition, following
consummation of the Exchange Offer whether or not required by the rules and
regulations of the SEC, the Company shall file a copy of all such information
and reports with the SEC for public availability within the time periods
specified in the SEC's rules and regulations (unless the SEC will not accept
such a filing) and make such information available to securities analysts and
prospective investors upon request. The Company shall at all times comply with
TIA ss 314(a).
(b) For so long as any Notes remain outstanding, the Company shall furnish
to the Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
Section 4.04. Compliance Certificate
----------------------
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture and the Collateral Documents, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and the Collateral Documents
and is not in default in the performance or observance of any of the terms,
provisions and conditions of this Indenture or the Collateral Documents (or, if
a Default or Event of Default shall have occurred, describing all such Defaults
or Events of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto) and that to the best
of his or her knowledge no event has occurred and remains in existence by reason
of which payments on account of the principal of or Interest, if any, on the
53
Notes is prohibited or if such event has occurred, a description of the event
and what action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding, deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default or any Default (as defined in the Cash Collateral and
Disbursement Agreement) or Event of Default (as defined in the Cash Collateral
and Disbursement Agreement), an Officers' Certificate specifying such Default or
Event of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes
-----
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws
------------------------------
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07. Restricted Payments
-------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
54
(i) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any payment
in connection with any merger or consolidation involving the Company or any
of its Restricted Subsidiaries) or to the direct or indirect holders of the
Company's or any of its Restricted Subsidiaries' Equity Interests in any
capacity (other than dividends or distributions payable in Equity Interests
(other than Disqualified Stock) of the Company or dividends or
distributions payable to the Company or a Wholly Owned Restricted
Subsidiary of the Company by a Wholly Owned Restricted Subsidiary of the
Company);
(ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the Company or
any direct or indirect parent of the Company or other Affiliate of the
Company (other than any such Equity Interests owned by the Company or any
Wholly Owned Restricted Subsidiary of the Company);
(iii) make any payment of principal (whether or not at maturity) on or
with respect to, or purchase, redeem, defease or otherwise acquire or
retire for value any Indebtedness that is pari passu with or subordinated
to the Notes (other than the Notes) (including, but not limited to,
repayment of principal on the Second Mortgage Notes); or
(iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(i) the Black Hawk Casino is Operating;
(ii) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(iii) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable fiscal period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in clause (ii) of the first
paragraph of Section 4.09 hereof;
(iv) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Closing Date (excluding Restricted Payments
permitted by clauses (ii) and (iii) of the next succeeding paragraph), is
less than the sum, without duplication, of:
(A) 50% of the Consolidated Net Income of the Company for the
period (taken as one accounting period) from the beginning of the
55
first fiscal quarter commencing on the earlier of the date the Black
Hawk Casino is Operating or September 14, 2001 to the end of the
Company's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit), plus
(B) 100% of the aggregate net cash proceeds received by the
Company from the issue or sale since the Closing Date of Equity
Interests of the Company (other than Disqualified Stock and other than
the Closing and Pre-Closing Equity Investments) or of Disqualified
Stock or debt securities of the Company that have been converted into
such Equity Interests (other than Equity Interests (or Disqualified
Stock or convertible debt securities) sold to a Subsidiary of the
Company and other than Disqualified Stock or convertible debt
securities that have been converted into Disqualified Stock), plus
(C) to the extent that any Restricted Investment that was made
after the Closing Date in compliance with this Section 4.07 is sold
for cash or otherwise liquidated or repaid for cash, the lesser of (A)
the cash return of capital with respect to such Restricted Investment
(less the cost of disposition, if any) and (B) the initial amount of
such Restricted Investment, plus
(D) the portion (proportionate to the Company's equity interest
in such Subsidiary) of the fair market value of the net assets of an
Unrestricted Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; provided, however, that such
portion shall not exceed, in the case of any Person, the amount of
Investments previously made (and treated as a Restricted Payment) by
the Company or any Restricted Subsidiary in such Person.
The preceding provisions will not prohibit the following Restricted
Payments:
(i) so long as no Default has occurred and is continuing or would be
caused by such payment, the payment of any dividend or distribution within
60 days after the date of declaration thereof, if at such date of
declaration such payment would have complied with the provisions of this
Indenture;
(ii) so long as no Default has occurred and is continuing or would be
caused by such payment, the redemption, repurchase, retirement, defeasance
or other acquisition of any pari passu Indebtedness, the Second Mortgage
Notes or Equity Interests of the Company in exchange for, or out of the net
cash proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of, other Equity Interests of the Company (other
than any Disqualified Stock); provided that the amount of any such net cash
proceeds that are utilized for any such redemption, repurchase, retirement,
defeasance or other acquisition shall be excluded from clause (iv)(b) of
the preceding paragraph;
56
(iii) so long as no Default has occurred and is continuing or would be
caused by such payment, the defeasance, redemption, repurchase or other
acquisition of pari passu or subordinated Indebtedness, including the
Notes, with the net cash proceeds from an incurrence of Permitted
Refinancing Indebtedness;
(iv) so long as no Default has occurred and is continuing or would be
caused by such payment, the defeasance, repurchase, redemption or other
acquisition of FF&E Financing pursuant to any scheduled pre-payment or
mandatory sinking fund relating to such FF&E Financing at the time of its
incurrence in accordance with the terms of this Indenture;
(v) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the repurchase of any Equity
Interests deemed to occur upon exercise of stock options or warrants if
such Equity Interests represent a portion of the exercise price of such
stock options or warrants;
(vi) so long as no Default has occurred and is continuing or would be
caused by such payment, the declaration of any scheduled dividends to
holders of any Disqualified Stock of the Company or any of its Restricted
Subsidiaries issued after the Closing Date in compliance with Section 4.09
hereof;
(vii) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the repurchase, redemption
or other acquisition or retirement for value of any Equity Interests of the
Company or any Restricted Subsidiary of the Company required by any
applicable law, rule or regulation (other than any Gaming Law);
(viii) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the repurchase, redemption
or other acquisition or retirement of any Equity Interests of the Company
or any Restricted Subsidiary of the Company required by any Gaming Law in
exchange for Gaming Redemption Indebtedness;
(ix) so long as no Default has occurred and is continuing or would be
caused by such payment, the repurchase, redemption or repayment of any
principal amount, or accrued and unpaid interest thereon, owing pursuant to
the Second Mortgage Notes following an Excess Cash Flow Offer to the
extent, and only to the extent, the Excess Cash Flow Offer Amount from such
Excess Cash Flow Offer exceeds 101% of the aggregate principal amount of
the Notes, plus accrued and unpaid interest thereon, tendered in such
Excess Cash Flow Offer; and
(x) any payment to Hyatt Gaming pursuant to and in accordance with the
provisions of Sections 4.10, 4.28 and 4.29.
57
The amount of all Restricted Payments (other than cash) shall be the fair
market value on the date of the Restricted Payment of the assets or securities
proposed to be transferred or issued to or by the Company or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued by this
Section 4.07 shall be determined by the Board of Directors whose resolution with
respect thereto shall be delivered to the Trustee. The Board of Directors'
determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if such
fair market value exceeds $5.0 million. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture.
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries
-------------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(i) pay dividends or make any other distributions on its Capital Stock
to the Company or any of its Restricted Subsidiaries, or with respect to
any other interest or participation in, or measured by its profits, or pay
any indebtedness owed to the Company or any of its Restricted Subsidiaries;
(ii) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(iii) transfer any of its properties or assets to the Company or any
of its Restricted Subsidiaries. However, the preceding restrictions will
not apply to such encumbrances or restrictions existing under or by reason
of:
(A) this Indenture, the Notes or the Collateral Documents;
(B) applicable law;
(C) by reason of customary non-assignment provisions in leases or
contracts entered into in the ordinary course of business;
(D) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive than those contained
in the agreements governing the Indebtedness being refinanced;
58
(E) the acquisition of the Capital Stock of any Person, or
property or assets of any Person by the Company or any Restricted
Subsidiary, if the encumbrances or restrictions (a) existed at the
time of the acquisition and were not incurred in contemplation thereof
and (b) are not applicable to any Person or the property or assets of
any Person other than the Person acquired or the property or assets of
the Person acquired;
(F) any agreement for the sale or other disposition
of a Restricted Subsidiary that restricts distributions by
that Restricted Subsidiary pending its sale or other
disposition;
(G) Liens securing FF&E Financing that limit the
right of the debtor to dispose of the assets subject to such
Lien; and
(H) the Second Mortgage Notes.
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred
Stock
-----------------------------------------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable with respect to, contingently
or otherwise (collectively, "incur"), any Indebtedness (including Acquired Debt)
and the Company shall not issue any Disqualified Stock and shall not permit any
of its Restricted Subsidiaries to issue any shares of preferred stock; provided,
however, that, so long as no Default or Event of Default has occurred and is
continuing, the Company may incur Indebtedness (including Acquired Debt) or
issue shares of Disqualified Stock if:
(i) the Black Hawk Casino is Operating;
(ii) the Fixed Charge Coverage Ratio for the
Company's most recently ended four full fiscal quarters for
which internal financial statements are available immediately
preceding the date on which such additional Indebtedness is
incurred or such Disqualified Stock is issued would have been
at least 2.0 to 1, determined on a pro forma basis (including
a pro forma application of the net proceeds therefrom), as if
the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the
beginning of such four-quarter period; and
(iii) the Weighted Average Life to Maturity of such
Indebtedness is greater than the remaining Weighted Average
Life to Maturity of the Notes.
The provisions of the first paragraph of this Section 4.09 shall not
prohibit the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Debt"):
59
(i) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Indebtedness represented by
the Notes to be issued on the Closing Date;
(ii) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the issuance by the Company
of the Exchange Notes to be issued pursuant to the Registration Rights
Agreement or the incurrence by the Company and its Restricted Subsidiaries
of obligations arising under the Collateral Documents, to the extent that
such obligations would constitute Indebtedness;
(iii) so long as no Default or Event of Default has occurred and is
continuing or would be caused by such payment, the incurrence by the
Company or any of its Restricted Subsidiaries of Permitted Refinancing
Indebtedness in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund, Indebtedness that was
permitted hereunder to be incurred under the first paragraph of this
Section 4.09 or clause (xi) of this Section 4.09;
(iv) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the incurrence by the
Company or any of its Restricted Subsidiaries of intercompany Indebtedness
between or among the Company and any of its Wholly Owned Restricted
Subsidiaries; provided, however, that:
(A) such Indebtedness is expressly subordinate to the payment in
full of all Obligations with respect to the Notes;
(B) any subsequent issuance or transfer of Equity Interests that
results in any such Indebtedness being held by a Person other than the
Company or a Wholly Owned Restricted Subsidiary and any sale or other
transfer of any such Indebtedness to a Person that is not either the
Company or a Wholly Owned Restricted Subsidiary thereof shall be
deemed, in each case, to constitute an incurrence of such Indebtedness
by the Company or such Wholly Owned Restricted Subsidiary, as the case
may be; and
(C) if any Restricted Subsidiary is the obligor on such
Indebtedness, such Indebtedness is represented by a Subsidiary
Intercompany Note that is pledged to the Trustee as security for the
Notes;
(v) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, the incurrence by the
Company of Hedging Obligations that (a) are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
incurred by the Company under clause (ix) below and (b) are on terms
approved by the holders of a majority of the aggregate principal amount of
the Notes (which approval shall not be unreasonably withheld);
60
(vi) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Indebtedness solely in respect
of City Improvement Bonds in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding not to exceed $3.0 million;
(vii) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Indebtedness solely in respect
of standby letters of credit or surety bonds required to be issued under
the Excavation Agreement (a) in an amount not to exceed the lesser of: 110%
of the cost of the remaining work to be performed thereunder or $7.5
million and (b) on terms approved by the holders of a majority of the
aggregate principal amount of the Notes (which approval shall not be
unreasonably withheld);
(viii) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Indebtedness solely in respect
of performance or similar bonds or standby letters of credit; provided that
any such bond or standby letter of credit is incurred in the ordinary
course of the Company's business pursuant to the Public Improvements
Performance Guarantee pursuant to paragraph 11 of the Subdivision Agreement
or the Bench Excavation Permit Remediation in an aggregate principal amount
not to exceed $2.0 million at any one time outstanding; and provided,
further, that any such bond or standby letter of credit is incurred on
terms customary for operations similar to the Company's and, provided,
further that such Indebtedness shall be reduced in an amount and to the
extent that funds are disbursed to the City of Black Hawk pursuant to such
Subdivision Agreement or Bench Excavation Permit Remediation;
(ix) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of FF&E Financing with the
consent of holders of a majority of the aggregate principal amount of the
Notes (which consent shall not be unreasonably withheld); provided,
however, that (a) the principal amount of such Indebtedness does not exceed
the cost (including sales and excise taxes, installation and delivery
charges and other direct costs of, and other direct expenses paid or
charged in connection with, such purchase) of the FF&E purchased or leased
with the proceeds thereof, (b) no Indebtedness incurred under the Notes is
utilized for the purchase or lease of such FF&E, (c) the aggregate
principal amount of such Indebtedness does not exceed $20.8 million
outstanding at any time; and (d) the payment of interest and principal
shall be amortized over at least a four-year period from the date of
issuance, with payments to be applied first to interest and then to
principal on a monthly (or less frequent) basis, which monthly (or less
frequent) payments shall not exceed $600,000 per month (or proportionately
greater amount for less frequent payments);
(x) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Indebtedness or the issuance
by the Company of Disqualified Stock solely to finance the construction of
a hotel, parking structure and related facilities at the Black Hawk Casino
during the first Operating Year, so long as the Fixed Charge Coverage Ratio
for the Company's most recently ended two full fiscal quarters for which
internal financial statements are available immediately preceding the date
61
on which such additional Indebtedness is incurred or such Disqualified
Stock is issued would have been at least 2.0 to 1, determined on a pro
forma basis, as if the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the beginning of
such two-quarter period;
(xi) without regard for whether a Default has occurred and is
continuing or would be caused by such payment, bond or surety obligations
posted by the Company or any of its Restricted Subsidiaries in order to
prevent the loss or material impairment of or to obtain a Gaming License or
as otherwise required by an order of any Gaming Authority to the extent
required by applicable law and consistent in character and amount with
customary industry practice so long as such Indebtedness does not result
in, and is not secured by, a Lien on any of the Collateral;
(xii) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in aggregate principal amount not
to exceed $5.0 million; provided that such Indebtedness has terms, and is
subordinated in right of payment to the payment in full in cash of the
Notes pursuant to terms, approved by the holders of a majority in aggregate
principal amount of the Notes (which approval shall not be unreasonably
withheld);
(xiii) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of the Second Mortgage Notes as
in effect on the Closing Date; and
(xiv) without regard for whether a Default has occurred and is
continuing, or would be caused by such payment, the incurrence by the
Company of Gaming Redemption Indebtedness as a result of any Gaming
Redemption; provided that such Indebtedness has terms, and is subordinated
in right of payment in full in cash of the Notes pursuant to terms,
approved by the holders of a majority in aggregate principal amount of the
Notes (which approval shall not be unreasonably withheld); and
(xv) so long as no Default or Event of Default has occurred and is
continuing, the incurrence by the Company of Additional Notes issued to The
Ravich Revocable Trust of 1989 or Affiliates of the foregoing in the
aggregate principal amount not to exceed $5.0 million; provided that such
Indebtedness is used solely to finance the completion of the development,
construction and initial equipment (other than equipment secured by or
purchased with the proceeds of any FF&E Financing) of the Black Hawk Casino
prior to the Operating of the Black Hawk Casino; provided, further, that
the Construction Disbursement Account and the Hyatt Gaming Construction
Disbursement Account have been depleted and less than $4.0 million of
aggregate proceeds remains in the Completion Reserve Account and the Hyatt
Gaming Completion Reserve Account and the Company reasonably believes that
the funds remaining in the Completion Reserve Account and the Hyatt Gaming
Completion Reserve Account will not be sufficient to finance completion of
the development, construction and initial equipment (other than equipment
62
secured by or purchased with the proceeds of any FF&E Financing) of the
Black Hawk Casino sufficient for the Black Hawk Casino to begin Operating;
and provided, further, that the Company reasonably believes that the
incurrence of such additional Indebtedness will provide proceeds to the
Company that are sufficient to finance the completion of the development,
construction and initial equipment of the Black Hawk Casino sufficient for
the Black Hawk Casino to begin Operating.
The Company shall not incur any Indebtedness (including Permitted Debt)
that is contractually subordinated in right of payment to any other Indebtedness
of the Company unless such Indebtedness is also contractually subordinated in
right of payment to the Notes on substantially identical terms; provided,
however, that no Indebtedness of the Company shall be deemed to be contractually
subordinated in right of payment to any other Indebtedness of the Company solely
by virtue of being secured.
For purposes of determining compliance with this Section 4.09, in the event
that an item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xv) above, or is
entitled to be incurred pursuant to the first paragraph of this Section 4.09 the
Company will be permitted to classify such item of Indebtedness on the date of
its incurrence in any manner that complies with this Section 4.09.
Section 4.10. Asset Sales
-----------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale, unless:
(i) the Black Hawk Casino is Operating;
(ii) the Company (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least equal to the
fair market value (evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee) of the assets
or Equity Interests issued or sold or otherwise disposed of;
(iii) at least 80% of the consideration received therefor by the
Company or such Subsidiary is in the form of cash or Cash Equivalents; and
(iv) the assets subject to such Asset Sale do not constitute
Collateral or, in the case of any such assets that do constitute
Collateral, such sale is permitted by the applicable Collateral Documents
or this Indenture.
For purposes of this provision, each of the following will be deemed
to be cash in the amount of:
(A) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet) of the Company or any
63
Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes) that
are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company or such
Restricted Subsidiary from further liability; and
(B) any securities or other obligations received by the Company
or any such Restricted Subsidiary from such transferee that are
promptly (but in any event within 90 days) converted by the Company or
such Restricted Subsidiary into cash (to the extent of the cash
received).
Within 270 days after the receipt of any Net Proceeds from an Asset Sale,
the Company or such Restricted Subsidiary, as the case may be, may (1) apply
such Net Proceeds to the making of a capital expenditure or the acquisition of
long-term assets, in either case, which will be owned by the Company or such
Restricted Subsidiary and be used by or useful to the Company or such Restricted
Subsidiary in any line of business in which the Company or such Restricted
Subsidiary is permitted to be engaged pursuant to Section 4.13 hereof or (2)
contractually commit to apply such Net Proceeds to the payment of the costs of
construction of real property improvements or the costs of capital expenditures
which, in each case, will be Collateral and will be owned by the Company or such
Restricted Subsidiary and be used by or useful to the Company or such Restricted
Subsidiary in any line of business in which the Company or such Restricted
Subsidiary is permitted to be engaged pursuant to Section 4.13 hereof; provided,
that in the case of each of clause (1) and clause (2) the Company or such
Restricted Subsidiary, as the case may be, uses such replacement asset at the
same location as the assets sold and grants to the Trustee, on behalf of the
Holders, a first priority perfected security interest on any such properties or
assets acquired or constructed with the Net Proceeds of any such Asset Sale on
the terms set forth in this Indenture and the Collateral Documents. Pending the
final application of any such Net Proceeds, the Company or such Restricted
Subsidiary may invest such Net Proceeds in Cash Equivalents which shall be
pledged to the Trustee as security for the Notes.
Any Net Proceeds from Asset Sales that do not constitute Collateral and
that are not applied or invested as provided in the preceding paragraph shall be
deemed to constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $5.0 million, the Company shall be required to make an offer
(an "Asset Sale Offer") to all Holders to purchase the maximum principal amount
of Notes that may be purchased out of the Excess Proceeds, at an offer price in
cash in an amount equal to 100% of the principal amount thereof plus accrued and
unpaid Interest and Liquidated Damages, if any, to the date of purchase, and
shall be in accordance with the provisions set forth in Section 3.10 hereof. To
the extent that the aggregate amount of Notes tendered pursuant to an Asset Sale
Offer is less than the Excess Proceeds, the Company may repay any principal
amount, or accrued and unpaid interest thereon, owing pursuant to the City
Improvement Bonds, the FF&E Financing and/or the Second Mortgage Notes (not to
exceed, in the aggregate, the amount by which the Excess Proceeds exceeds the
aggregate principal amount of Notes, plus accrued and unpaid interest thereon,
tendered in such Asset Sale Offer) and may, subject to the provisions of this
Indenture and the Collateral Documents, use any remaining Excess Proceeds for
any purpose not otherwise prohibited by this Indenture and the Collateral
64
Documents. If the aggregate principal amount of Notes tendered in such Asset
Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes to be purchased pursuant to Section 3.02. Upon completion of such Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
Section 4.11. Transactions with Affiliates.
----------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless:
(a) such Affiliate Transaction is on terms that are no less favorable to
the Company or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person; and
(b) the Company delivers to the Trustee
(i) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of $1.0
million, a resolution of the Company's Board of Directors set forth in an
Officers' Certificate certifying that such Affiliate Transaction complies
with clause (a) above and that such Affiliate Transaction has been approved
by a majority of the disinterested Directors, and
(ii) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of $5.0
million, an opinion as to the fairness to the Holders of such Affiliate
Transaction from a financial point of view issued by an independent
accounting, appraisal or investment banking firm of national standing.
The following items will not be deemed to be Affiliate Transactions and,
therefore, will not be subject to the provisions of the prior paragraph:
(i) payments made pursuant to the Management Agreement and the Second
Mortgage Notes as in effect on the Closing Date so long as such payments
are not prohibited by Section 4.07 or 4.27.
(ii) any employment agreement entered into by the Company or any of
its Restricted Subsidiaries in the ordinary course of business on terms
customary in the gaming industry providing for payments not to exceed
$240,000 individually during any twelve- month period (so long as the
aggregate payments to all employees, consultants, accountants, attorneys,
representatives, developers and other professionals (other than Hyatt
Gaming) and the aggregate costs associated with the operations of the
Company (other than pursuant to the Management Agreement) do not exceed
$700,000 in the aggregate during any twelve- month period beginning after
the Casino is Operating);
65
(iii) any indemnification agreement entered into by the Company or any
of its Restricted Subsidiaries in the ordinary course of business on terms
customary in the gaming industry;
(iv) Restricted Payments that are permitted by Section 4.07 hereof;
(v) any transaction or series of transactions solely between the
Company and one or more of its Restricted Subsidiaries; and
(vi) Affiliate Agreements pursuant to written, executed agreements in
effect on the Closing Date, the material terms of which are described in
the Offering Memorandum, and renewals and extensions of such agreements on
terms no less favorable to the Holders than the terms of such original
agreements and transactions.
Notwithstanding the foregoing provisions of this Section 4.11, the Company
will not permit:
(i) the aggregate amount of all salary and benefits payments (whether
in cash or other property) made directly or indirectly to all employees of
the Company (exclusive of the Company's construction management personnel
under the direction of Building Sciences, Inc. as set forth in the
Construction Disbursement Budget, in an amount not to exceed $375,000
during any twelve-month period), including Xx. Xxxxxx Xxxxxxxxxx, Xx.
Xxxxxxx Xxxx, Mr. Xxxxxxx Xxxxxxxxx, and the two administrative assistants,
as set forth in the Construction Disbursement Budget, to exceed (a)
$800,000 during the twelve-month period beginning on the Closing Date or
(b) $1.2 million during the period beginning on the Closing Date and ending
on the first date on which the Black Hawk Casino is Operating, excluding
reimbursement for reasonable and documented travel and related expenses
included in the Construction Disbursement Budget of approximately $225,000
in the aggregate for the period beginning on the Closing Date and ending on
the first date on which the Black Hawk Casino is Operating;
(ii) Xx. Xxxxxxxxxx, Xx. Xxxx, Xx. Xxxxxxxxx and their affiliates to
be paid any other consulting fees, development fees, salary or other
compensation for services provided to the Company except as provided in
clause (i) above, and except for, notwithstanding the foregoing, (1) the
issuance of $1.7 million aggregate liquidation preference of the Company's
Series A Preferred Stock and the payment $300,000 in cash to Xx. Xxxxxxxxxx
for past salaries and other project development costs, including
reimbursement of expenses, (2) consideration for consulting services
rendered by Xx. Xxxx and a success fee payable to Xx. Xxxx in the aggregate
amount of approximately $421,000 in cash, and (3) consideration for
consulting services rendered by Xx. Xxxxx X. Xxxxxxxx payable to Xx.
Xxxxxxxx in the amount of $150,000 in cash, in each case, payable on the
Closing Date; or
(iii) the aggregate amount of all payments (whether in cash or other
property) to all employees, consultants, accountants, attorneys,
developers, representatives and other professionals (other than Xxxxx
Xxxxxx) and retained by or on behalf of the Company, together with the
66
aggregate costs associated with the operations of the Company (other than
pursuant to the Management Agreement), to exceed $700,000 in the aggregate
during any twelve-month period beginning on and after the first date on
which the Black Hawk Casino is Operating.
Section 4.12. Liens
-----
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien on any asset now owned or hereafter acquired, or any proceeds,
income or profits therefrom or assign or convey any right to receive income
therefrom, except Permitted Liens.
Section 4.13. Line of Business
----------------
The Company shall not, and shall not permit any Subsidiary to, engage in
any business, development or investment activities other than the Gaming
Business at the Black Hawk Casino and/or the operation of a hotel at the Black
Hawk Casino.
Section 4.14. Corporate Existence
-------------------
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Subsidiaries, in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Company or any such Subsidiary and
(ii) the rights (charter and statutory), licenses and franchises of the Company
and its Subsidiaries; provided, however, that the Company shall not be required
to preserve any such right, license or franchise, or the corporate, partnership
or other existence of any of its Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
The Borrower will not liquidate or dissolve and will take and fulfill, or cause
to be taken and fulfilled, all actions and conditions necessary to qualify, and
to preserve and keep in full force and effect its qualification, to do business
as a foreign corporation in the jurisdictions in which the conduct of its
business or the ownership or leasing of its properties requires such
qualification, except to the extent such failure would not have a material
adverse effect.
Section 4.15. Articles of Incorporation.
--------------------------
The Company shall not amend Article Fifth or Article Ninth of its Amended
and Restated Articles of Incorporation as in effect on the Closing Date.
Section 4.16. Limitation on Sale and Leaseback Transactions
---------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company or any of its Restricted Subsidiaries may enter into a sale and
leaseback transaction if:
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(i) the Company or such Restricted Subsidiary could have (a) incurred
Indebtedness in an amount equal to the Attributable Debt relating to such
sale and leaseback transaction pursuant to the Fixed Charge Coverage Ratio
test set forth in the first paragraph of Section 4.09 hereof and (b)
incurred a Lien to secure such Indebtedness pursuant to the provisions of
Section 4.12 hereof;
(ii) the gross cash proceeds of such sale and leaseback transaction
are at least equal to the fair market value (as determined in good faith by
the Board of Directors and set forth in an Officers' Certificate delivered
to the Trustee) of the property that is the subject of such sale and
leaseback transaction; and
(iii) the transfer of assets in such sale and leaseback transaction is
permitted by, and the Company applies the proceeds of such transaction in
compliance with Section 4.10 hereof.
Section 4.17. Limitation on Formation of Subsidiaries and Issuances and
Sales of Equity Interests in Wholly Owned Subsidiaries.
-------------------------------------------------------
Without the consent of holders of a majority in aggregate principal amount
of the Notes, the Company shall not, directly or indirectly, create or acquire
or agree to create or acquire any Subsidiaries. The Company (i) shall not, and
shall not permit any Restricted Subsidiary of the Company to, transfer, convey,
sell, lease or otherwise dispose of any Capital Stock of any Wholly Owned
Restricted Subsidiary to any Person (other than the Company or a Wholly Owned
Restricted Subsidiary of the Company), unless (a) such transfer, conveyance,
sale, lease or other disposition is of all the Capital Stock of such Wholly
Owned Restricted Subsidiary and (b) the cash Net Proceeds from such transfer,
conveyance, sale, lease or other disposition are applied in accordance with
Section 4.10 or Section 5.01, as the case may be, and (ii) shall not permit any
Wholly Owned Restricted Subsidiary of the Company to issue any of its Equity
Interests (other than, if necessary, shares of its Capital Stock constituting
directors' qualifying shares) to any Person other than to the Company or a
Wholly Owned Restricted Subsidiary of the Company.
Section 4.18. Advances to Subsidiaries
------------------------
All advances to Subsidiaries made by the Company from time to time after
the Closing Date shall be evidenced by unsecured Subsidiary Intercompany Notes
in favor of the Company that will be pledged to the Trustee as Collateral to
secure the Notes, subject to the Intercreditor Agreement. Each Subsidiary
Intercompany Note shall be payable upon demand and shall bear interest at the
same rate as the Notes.
Section 4.19. Payments for Consent
--------------------
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, to or for the benefit of
any Holder for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of this Indenture or the Notes unless such
68
consideration is offered to be paid or is paid to all Holders that consent,
waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 4.20. Additional Subsidiary Guarantees
--------------------------------
Without limiting the provisions of Section 4.17, if the Company or any of
its Restricted Subsidiaries shall acquire or create a Restricted Subsidiary
after the Closing Date, the Company shall cause such newly acquired or created
Restricted Subsidiary to, within ten (10) Business Days of the date on which it
was acquired or created, execute a Guarantee in the form of a Supplemental
Indenture in the form attached as Exhibit F hereto, and the Company shall
execute and deliver, and cause such Subsidiary and others to execute and deliver
to the Trustee such Collateral Documents and shall execute and deliver, and
cause such Subsidiary and others to execute and deliver such other documents,
Opinions of Counsel as the holders of a majority in aggregate principal amount
of the Notes shall require to create, or to confirm the creation of, a valid,
perfected, first priority security interest in and Lien on the property and
other assets of such Restricted Subsidiary, and 100% of the outstanding Capital
Stock of such newly acquired or created Subsidiary.
Section 4.21. Insurance
---------
Until the Notes have been paid in full, the Company shall, and shall cause
its Restricted Subsidiaries to, maintain insurance with responsible carriers
against such risks and in such amounts as is customarily carried by similar
businesses with such deductibles, retentions, self insured amounts and
coinsurance provisions as are customarily carried by similar businesses of
similar size, including, without limitation, property and casualty, and, with
respect to insurance on the Collateral, shall have provided insurance
certificates evidencing such insurance to the Trustee on or prior to the Closing
Date and shall thereafter provide such certificates prior to the anniversary or
renewal date of each such policy, which certificate shall expressly state the
expiration date for each policy listed. Customary insurance coverage shall be
deemed to include the following:
(i) workers' compensation insurance to the extent required to comply
with all applicable state, territorial or United States laws and
regulations, or the laws and regulations of any other applicable
jurisdiction;
(ii) comprehensive general liability insurance with minimum limits of
$1.0 million;
(iii) umbrella or excess liability insurance providing excess
liability coverages over and above the foregoing underlying insurance
policies up to a minimum limit of $25.0 million;
(iv) business interruption insurance at all times on and after the
Black Hawk Casino is Operating; and
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(v) property insurance protecting the property against loss or damage
by fire, lightning, windstorm, tornado, water damage, vandalism, riot,
earthquake, civil commotion, malicious mischief, hurricane and such other
risks and hazards as are from time to time covered by an "all-risk" policy
or a property policy covering "special" causes of loss. Such insurance
shall provide coverage in the amount of not less than the lesser of 120% of
the outstanding principal amount of the Notes plus accrued and unpaid
Interest and 100% of actual replacement value (as determined at each policy
renewal based on the X.X. Xxxxx Building Index or some other recognized
means) of any improvements customarily insured consistent with industry
standards and with a deductible no greater than 2% of the insured value of
the Black Hawk Casino or such greater amount as is available on
commercially reasonable terms (other than earthquake or flood insurance,
for which the deductible may be up to 10% of such replacement value).
All insurance required under this Indenture (except worker's compensation)
shall name the Company and the Trustee as additional insureds or loss payees, as
the case may be, with losses in excess of $1.0 million payable jointly to the
Company and the Trustee (unless a Default or Event of Default has occurred and
is then continuing, in which case all losses are payable solely to the Trustee),
with no recourse against the Trustee for the payment of premiums, deductibles,
commissions or club calls, and for at least 30 days notice of cancellation. All
such insurance policies shall be issued by carriers having an A.M. Best &
Company, Inc. rating of A or higher and a financial size category of not less
than X, or if such carrier is not rated by A.M. Best & Company, Inc., having the
financial stability and size deemed appropriate by an opinion from a reputable
insurance broker. The Company shall deliver to the Trustee on the Closing Date
and each anniversary thereafter a certificate of an insurance agent stating that
the insurance policies obtained by the Company and its Restricted Subsidiaries
comply with this Section 4.21 and the related applicable provisions of the
Collateral Documents.
Section 4.22. Limitation on Status as Investment Company
------------------------------------------
The Company and its Subsidiaries are prohibited from being required to
register as an "investment company" (as that term is defined in the Investment
Company Act of 1940, as amended), or from otherwise becoming subject to
regulation under the Investment Company Act of 1940.
Section 4.23. Further Assurances
------------------
The Company shall (and shall cause each of its Restricted Subsidiaries to)
do, execute, acknowledge, deliver, record, re-record, file, re-file, register
and re-register, as applicable, any and all such further acts, deeds,
conveyances, security agreements, mortgages, assignments, estoppel certificates,
financing statements and continuations thereof, termination statements, notices
of assignment, transfers, certificates, assurances and other instruments as may
be required from time to time in order: (i) to carry out more effectively the
purposes of the Collateral Documents; (ii) to subject to the Liens created by
any of the Collateral Documents any of the properties, rights or interests
required to be encumbered thereby; (iii) to perfect and maintain the validity,
70
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby; and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Trustee any of the rights
granted now or hereafter intended by the parties thereto to be granted to the
Trustee or under any other instrument executed in connection therewith or
granted to the Company under the Collateral Documents or under any other
instrument executed in connection therewith.
Section 4.24. Construction
------------
The Company shall construct the Black Hawk Casino, including the
furnishing, fixturing and equipping thereof, to be prosecuted with diligence and
continuity in a good and workmanlike manner substantially in accordance with the
Plans and contracts to which the Company is a party and in accordance with the
Cash Collateral and Disbursement Agreement.
Section 4.25. Limitation on Use of Proceeds
-----------------------------
The Company shall cause the net proceeds of the Offering, and the proceeds
from the issuance of the Second Mortgage Notes, to be deposited in the Cash
Collateral Accounts and Hyatt Gaming Cash Collateral Accounts. Of such amounts,
approximately $24.1 million will be deposited in the Interest Reserve Account
and invested solely in Government Securities, approximately $57.3 million will
be deposited in the Construction Disbursement Account and the Hyatt Gaming
Construction Disbursement Account and invested solely in Investment Grade
Securities, and approximately $8.0 million will be deposited in the Completion
Reserve Account and the Hyatt Gaming Completion Reserve Account and invested
solely in Investment Grade Securities, in each case, to be disbursed only in
accordance with the Cash Collateral and Disbursement Agreement. The Company
shall cause the net proceeds from the Offering of any Additional Notes to be
used solely for the purposes set forth in Section 2.02(b).
Section 4.26. Right of First Offer with Respect to Hotel Additional Notes.
-----------------------------------------------------------
(a) In the event the Company elects to issue any Hotel Additional Notes
pursuant to Section 2.02(b), the Company shall provide Ableco Finance LLC and
its Affiliates ("Ableco"), on behalf of itself, its Affiliates and its accounts,
the right to purchase some or all of such Hotel Additional Notes in accordance
with this Section 4.26. Prior to the issuance of any Hotel Additional Notes, the
Company shall:
(i) provide to Ableco and its representatives written calculations of
the estimated project costs associated with the Hotel Project at least 10
Business Days prior to the commencement of the business and legal due
diligence described in clause (ii) below and at least 5 Business Days prior
to the commencement of the negotiations described in clause (iii) below (it
being understood that the estimated project costs shall provide such detail
that (x) is customary in the private placement market for a financing of
the type contemplated by the Hotel Additional Notes, (y) is similar in
scope to the estimated project cost detail provided in connection with the
Offering of the Initial Notes and (z) is in sufficient form to enable an
investor to make a determination of whether to invest in the Hotel
Project); and
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(ii) provide Ableco and its representatives with reasonable access to
the Company's management and outside legal advisors in order to conduct
business and legal due diligence during at least a 10 Business Day period;
(iii) negotiate the pricing terms of the Hotel Additional Notes with
Ableco and it representatives in good faith during at least a 20 Business
Day period commencing with the commencement of the business and legal due
diligence described in the foregoing clause (ii) and draft and finalize the
legal documentation for the purchase of such Hotel Additional Notes by
Xxxxxx at the end of such 20 Business Day period.
(b) If, at the end of the 20 Business Day period described in the foregoing
clause (iii) of paragraph (a), Ableco, on behalf of itself, its Affiliates or
any of its accounts, has not entered into a binding legal commitment to purchase
any of the Hotel Additional Notes (or if, at the end of such 20 Business Day
period , Ableco has entered into a binding legal commitment to purchase only
some of the Hotel Additional Notes that the Company offered to Ableco pursuant
to the foregoing paragraph (a)), the Company shall during the 90 Business Day
period following the end of such 20 Business Day period be permitted to
consummate the sale (or enter into a binding legal commitment to consummate such
sale) to any Person of any Hotel Additional Notes offered to Ableco pursuant to
the foregoing paragraph (a) that were not purchased by Ableco or any of its
Affiliates or accounts.
(c) If at the end of the 90 Business Day period described in the foregoing
paragraph (b), the Company has not entered into binding legal commitments to
sell all of the Hotel Additional Notes that it desires to sell, the Company
shall offer to sell such Hotel Additional Notes to Cerberus in accordance with
paragraphs (a) and (b) of this Section 4.26.
Section 4.27. Restriction on Payment of Management Fees
-----------------------------------------
The Company shall not, directly or indirectly, pay to Hyatt Gaming or any
of its Affiliates any Management Fees except pursuant to the Management
Agreement as in effect on the Closing Date and in accordance with this
Indenture. Amounts payable pursuant to the Management Agreement and the Manager
Subordination Agreement will not be prepaid, and no payment of the Incentive Fee
(as defined in the Management Agreement as in effect on the Closing Date),
either current or accrued, shall be made prior to the date the Black Hawk Casino
is Operating or if at the time of payment of such Incentive Fee:
(i) a Default or an Event of Default shall have occurred and be
continuing or shall occur as a result thereof; or
(ii) the Company's Fixed Charge Coverage Ratio for its most recently
ended four full fiscal quarters for which internal financial statements are
available immediately preceding the date on which such Incentive Fee is
proposed to be paid would have been less than 1.5 to 1.0 (calculated on a
pro forma basis after deducting from Consolidated Cash Flow (A) Incentive
Fees paid in cash in accordance herewith after the first day of such fiscal
period, and (B) any Incentive Fees deferred from a prior period proposed to
be paid in cash during such period, but excluding any Incentive Fees
deferred or accrued and not paid in cash during such period).
72
With respect to periods following the date the Black Hawk Casino first
becomes Operating and prior to the time when internal financial statements are
available for four full fiscal quarters following the date the Black Hawk Casino
first becomes Operating, such Fixed Charge Coverage Ratio shall be calculated
only with respect to the number of full fiscal quarters (but in no event less
than one full fiscal quarter) for which internal financial statements are
available following the date the Black Hawk Casino first becomes Operating. Any
Incentive Fees not permitted to be paid pursuant to Section 4.27 shall be
deferred and shall accrue without interest and may be paid only at such time
that they would otherwise be permitted to be paid hereunder.
The right of the Manager to receive payment of the Incentive Fee shall be
subordinate in right of payment to the right of the Holders to receive payments
in full in cash of all obligations with respect to the notes pursuant to the
terms of the Manager Subordination Agreement.
The terms of the Management Agreement cannot be amended to increase amounts
to be paid thereunder, or in any other manner which would be adverse to the
Company or the Holders, including without limitation, to amend the method of
computing the Annual Management Fee, the Basic Fee or the Incentive Fee in each
case, as defined in the Management Agreement on the Closing Date); provided,
however, that the foregoing shall not prohibit any amendment required under any
Gaming Law or by any Gaming Authority.
Section 4.28. Event of Loss
-------------
Subject to the conditions set forth below, within 90 days after any Event
of Loss with respect to any Collateral, the Company or the affected Restricted
Subsidiary of the Company, as the case may be, shall so notify the Trustee,
describing in such notice the nature of the Event of Loss in reasonable detail,
and shall (i) subject to the provisions of this Section 4.28, apply the Net Loss
Proceeds from such Event of Loss to the rebuilding, repair, replacement or
construction of the improvements to the Black Hawk Casino, with no concurrent
obligation to make any offer to purchase any Notes; (ii) if the Black Hawk
Casino is not Operating and the Net Loss Proceeds exceed $1.0 million, deposit
the Net Loss Proceeds in the Construction Disbursement Account to be disbursed
in accordance with the procedures set forth in the Cash Collateral and
Disbursement Agreement; (iii) if the Net Loss Proceeds exceed $1.0 million,
deliver to the Trustee within 60 days after such Event of Loss a written opinion
from a nationally recognized architect that the Black Hawk Casino, with at least
the Minimum Facilities, can be rebuilt, repaired, replaced or constructed and
Operating within not more than 360 days after the Event of Loss (but in no event
later than the date that is six months prior to the maturity date of the Notes);
and (iv) if the Net Loss Proceeds exceed $1.0 million, deliver an Officers'
Certificate certifying that the Company has available from Net Loss Proceeds or
other sources sufficient funds to complete the rebuilding, repair, replacement
or construction described in clause (i) above and in accordance with clause
(iii) above.
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Upon the occurrence of an Event of Loss with respect to any Collateral
having a fair market value or a replacement cost, if greater, than $20 million,
of if upon the occurrence of any Event of Loss the Company is unable or fails to
furnish the written opinion from a nationally recognized architect as required
by clause (iii) above, then the Company shall, simultaneously with the delivery
of the notice to the Trustee as set forth above, deliver to the Holders a notice
(an "Event of Loss Notice") providing for the following: an option either (x) to
allow the Company to apply the Net Loss Proceeds to the rebuilding, repair,
replacement or construction of the improvements to the Black Hawk Casino or (y)
to require that the Company purchase the maximum principal amount of Notes that
may be purchased out of the Net Loss Proceeds, at a purchase price in cash in an
amount equal to 100% of the principal amount thereof, plus accrued and unpaid
Interest and Liquidated Damages, if any, thereon to the date of purchase (an
"Event of Loss Offer").
If Holders of a majority of the aggregate principal amount of the Notes
then outstanding provide a written request (an "Event of Loss Acceptance"),
within 30 days after the Event of Loss Notice that the Company effect an Event
of Loss Offer, then the Company shall, within 10 days after the Event of Loss
Acceptance, effect an Event of Loss Offer. The Event of Loss Offer shall be
conducted in accordance with Section 3.10 hereof and shall be consummated not
less than 30 nor more than 60 days after the date of such Event of Loss Offer.
To the extent that the aggregate principal amount of Notes tendered pursuant to
an Event of Loss Offer exceeds the Net Loss Proceeds, the Trustee shall select
the Notes to be purchased in the manner described under Section 3.02 hereof. To
the extent that the aggregate amount of Notes tendered pursuant to an Event of
Loss Offer is less than the Net Loss Proceeds, the Company may repay any
principal amount, or accrued and unpaid interest thereon, owing pursuant to the
City Improvement Bonds, the FF&E Financing and/or the Second Mortgage Notes (not
to exceed, in the aggregate, the amount by which the Net Loss Proceeds exceeds
the aggregate principal amount of Notes, plus accrued and unpaid interest
thereon, tendered in such Event of Loss Offer) and may, subject to the other
provisions of this Indenture and the Collateral Documents, use any remaining Net
Loss Proceeds for any purpose not otherwise prohibited by this Indenture.
In the event that an Event of Loss Acceptance shall not have been given as
provided in the preceding paragraph, then the Company shall utilize and apply
the Net Loss Proceeds to the rebuilding, repair, replacement or construction of
the improvements as aforesaid, consistent with the provisions of this Indenture
and the Collateral Documents.
Pending the rebuilding, repair, replacement or construction of the
improvements as aforesaid or the completion of any Event of Loss Offer, the
Company or the affected Restricted Subsidiary, as the case may be, shall pledge
to the Trustee as additional Collateral all Net Loss Proceeds or other cash on
hand required for such rebuilding, repair, replacement or construction pursuant
to the terms of the Collateral Documents relating to the Black Hawk Casino. Such
pledged funds shall be released to the Company or the affected Restricted
Subsidiary to pay for or reimburse the Company or the affected Restricted
Subsidiary for the actual cost of such permitted rebuilding, repair, replacement
or construction, or such Event of Loss Offer, only as provided in this Section
4.28 and pursuant to the terms of the Collateral Documents relating to the Black
Hawk Casino. Pending the final application of the Net Loss Proceeds, such
proceeds may be invested in Cash Equivalents which shall be pledged to the
74
Trustee as security for the Notes. The Company or the applicable Restricted
Subsidiary shall grant to the Trustee, on behalf of the Holders, a first
priority lien, subject to Permitted Liens, on any properties or assets rebuilt,
repaired, replaced or constructed with such Net Loss Proceeds on the terms set
forth in this Indenture and the Collateral Documents. With respect to any Event
of Loss pursuant to clause (iv) of the definition of "Event of Loss" that has a
fair market value (or replacement cost, if greater) in excess of $5.0 million,
the Company (or the affected Restricted Subsidiary, as the case may be), shall
be required to receive consideration at least (i) equal to the fair market value
(evidenced by a resolution of the Board of Directors set forth in an Officers'
Certificate delivered to the Trustee) of the assets subject to the Event of Loss
and (ii) at least 90% of which is in the form of Cash Equivalents.
Regardless of whether Net Loss Proceeds are made available to the Company
pursuant to the provisions of this Section 4.28, upon the occurrence of an Event
of Loss the Company shall promptly repair the improvements to be at least equal
in value and of substantially the same character and condition as prior to such
damage.
Section 4.29. Excess Cash Purchase Offers
---------------------------
Within 120 days after each Operating Year of the Company, beginning with
the first Operating Year after the Black Hawk Casino becomes Operating, the
Company shall make an offer to all Holders (the "Excess Cash Flow Offer") to
purchase the maximum principal amount of Notes that is an integral multiple of
$1,000 that may be purchased with (i) 50% of the Company's Excess Cash Flow for
the four consecutive fiscal quarters ending on or immediately following the last
day of the Operating Year then ended plus (ii) any amounts disbursed from the
Cash Collateral Accounts and the Hyatt Cash Collateral Accounts pursuant to
Section 11 of the Cash Collateral and Disbursement Agreement that the Company
elects, in its sole discretion, to include in any Excess Cash Flow Offer (the
sum of the foregoing clauses (i) and (ii), collectively, the "Excess Cash Flow
Offer Amount"), at a purchase price in cash equal to 101% of the principal
amount of the Notes to be purchased, plus accrued and unpaid Interest and
Liquidated Damages, if any, thereon to the date of purchase (the "Excess Cash
Flow Purchase Price"), in accordance with this Indenture. The Event of Loss
Offer shall be conducted in accordance with Section 3.10. Upon the expiration of
the Event of Loss Offer, the Company shall apply the Excess Cash Flow Offer
Amount to the purchase of all Notes tendered at the Excess Cash Flow Offer
Purchase Price. If the aggregate principal amount of Notes tendered pursuant to
an Excess Cash Flow Offer exceeds the Excess Cash Flow Offer Amount with respect
thereto, the Trustee shall select the Notes to be repurchased in the manner
described under Section 3.02 hereof. To the extent that the aggregate principal
amount of Notes tendered pursuant to any Excess Cash Flow Offer is less than the
Excess Cash Flow Offer Amount with respect thereto, the Company may repay any
principal amount, or accrued and unpaid interest thereon, owing pursuant to the
City Improvement Bonds, the FF&E Financing and/or the Second Mortgage Notes (not
to exceed, in the aggregate, the amount by which the Excess Cash Flow Offer
Amount exceeds 101% of the aggregate principal amount of notes, plus accrued and
unpaid interest thereon, tendered in such Excess Cash Flow Offer) and may,
subject to the other provisions of this Indenture and the Collateral Documents,
use any remaining Excess Cash Flow for general corporate purposes and the amount
of Excess Cash Flows shall be reset at zero.
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Section 4.30. Approvals Under Management Agreement.
-------------------------------------
In the event that Hyatt Gaming has any right to approve any drawings,
plans, specifications or contracts in connection with the construction,
equipping and opening of the Black Hawk Casino, the Company will prepare, enter
into and/or submit to Hyatt Gaming for approval such drawings, plans,
specifications and contracts that the Company reasonably believes Hyatt Gaming
will approve and/or Hyatt Gaming has indicated it would approve (or waive its
approval rights with respect thereto), so long as the fees and costs associated
with such drawings, plans, specifications and contracts, as adopted or executed,
would not exceed the amount allocated for such items in the Cash Collateral and
Disbursement Agreement.
Section 4.31. Extension of Subdivision Agreement
----------------------------------
The Company shall cause:
(i) the completion of public improvements required pursuant to the
Subdivision Agreement to be substantially completed in all material
respects on or prior to June 1, 2000; or
(ii) the date on which such public improvements are required to be
substantially completed in all material respects pursuant to the
Subdivision Agreement to be extended from June 1, 2000 through at least
December 31, 2001.
Section 4.32. Deposit of Funds into Construction Disbursement Accounts
--------------------------------------------------------
When any cash or other proceeds are released from any existing escrow
account or security deposit made by or held for the benefit of the Company, the
Company shall cause such cash or other proceeds to be deposited into the
Construction Disbursement Account and the Hyatt Gaming Construction Disbursement
Account on a pro rata basis promptly following the release of such cash or other
proceeds.
Section 4.33. Board of Directors
------------------
The Company shall not permit the Board of Directors of the Company to be
comprised at any time of a number of directors such that the number of directors
who are at any time Related Parties exceeds the number of directors who are not
Related Parties.
ARTICLE 5.
SUCCESSORS
----------
Section 5.01. Merger, Consolidation, or Sale of Assets
----------------------------------------
The Company shall not, directly or indirectly, consolidate or merge with or
into (whether or not the Company is the surviving corporation), or sell, assign,
transfer, convey or otherwise dispose of all or substantially all of its
76
properties or assets of the Company and its Subsidiaries taken as a whole, in
one or more related transactions to, another Person unless (i) the Company is
the surviving corporation or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States, any state
thereof or the District of Columbia, (ii) the Person formed by or surviving any
such consolidation or merger (if other than the Company) or the Person to which
such sale, assignment, transfer, conveyance or other disposition shall have been
made assumes all the obligations of the Company under the Notes, this Indenture
and the Collateral Documents pursuant to a supplemental indenture in a form
reasonably satisfactory to the Trustee, (iii) immediately after such
transaction, no Default or Event of Default exists (iv) such transaction would
not result in the loss or suspension or material impairment of any Gaming
License unless a comparable replacement Gaming License is effective prior to or
simultaneously with such loss, suspension or material impairment; (v) the
Company or the Person formed by or surviving any such consolidation or merger
(if other than the Company), or to which such sale, assignment, transfer,
conveyance or other disposition shall have been made: (a) shall have
Consolidated Net Worth immediately after the transaction equal to or greater
than the Consolidated Net Worth of the Company immediately preceding the
transaction; and (b) shall, on the date of such transaction after giving pro
forma effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in clause (ii) of the first paragraph of Section
4.09 hereof; (vi) such transaction would not require any Holder or beneficial
owner of Notes to obtain a Gaming License or be qualified or found suitable
under the law of any applicable gaming jurisdiction; provided that such Holder
or beneficial owner would not have been required to obtain a Gaming License or
be qualified or found suitable under the laws of any applicable gaming
jurisdiction in the absence of such transaction; and (vii) the Casino is
Operating. In addition, the Company shall not, directly or indirectly, lease all
or substantially all of its properties or assets, in one or more related
transactions, to any other Person.
Section 5.02. Successor Corporation Substituted
---------------------------------
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in accordance with Section 5.01 hereof, the successor corporation formed
by such consolidation or into or with which the Company is merged or to which
such sale, assignment, transfer, lease, conveyance or other disposition is made
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and Interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
77
ARTICLE 6.
DEFAULTS AND REMEDIES
---------------------
Section 6.01. Events of Default
-----------------
An "Event of Default" occurs and is continuing under this Indenture if:
(a) the Company defaults for 30 days in the payment when due of Interest
on, or Liquidated Damages, if any, with respect to, the Notes;
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Notes;
(c) the Company fails to comply with any of the provisions of Section 4.07,
4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20, 4.21,
4.25, 4.28, 4.29, 4.30, 4.31, 4.32 or 5.01 hereof;
(d) a Change of Control shall occur;
(e) the Company or any of its Restricted Subsidiaries for 30 days after
notice thereof fails to comply with the provisions of any of the other
agreements in this Indenture not set forth in clause (c) above;
(f) a default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Subsidiaries (or
the payment of which is guaranteed by the Company or any of its Subsidiaries)
whether such Indebtedness or guarantee now exists, or is created after the
Closing Date, if that default: (i) is caused by a failure to pay principal of,
or interest or premium, if any, on such Indebtedness prior to the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default"); or (ii) results in the acceleration of such Indebtedness
prior to its express maturity, and, in each case, the principal amount of any
such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $1.0 million or more;
(g) the Company or any of its Restricted Subsidiaries fails to pay final
judgments aggregating in excess of $5.0 million, which judgments are not paid,
discharged or stayed for a period of 60 days; and
(h) the Company, the LLC or any of their respective Affiliates breaches any
material representation or warranty in the Collateral Documents or any
certificates delivered in connection therewith, (ii) the Company, the LLC or any
of their respective Affiliates fails after written notice thereof to comply with
any material covenant or agreement set forth in the Collateral Documents,
78
(iii) the Company, the LLC or their respective Affiliates repudiates any of its
obligations under the Collateral Documents, (iv) the Collateral Documents become
unenforceable against the Company, the LLC or their respective Affiliates or
perfection or priority of the Liens granted by the Company, the LLC or their
respective Affiliates thereunder is lost for any reason, which in the case of
clauses (i) and (ii) remains uncured for a period of 30 days after written
notice specifying such breach or default;
(i) the Company or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) generally is not paying its debts as they become due; or
(j) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary in an involuntary case;
(ii) appoints a custodian of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; or
(iii) orders the liquidation of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days;
(k) the revocation, termination, suspension or other cessation of
effectiveness for a period of more than 90 consecutive days of any Gaming
License results in the cessation or suspension of gaming operations at any
Gaming Facility; or
79
(l) the Black Hawk Casino fails to be Operating by the Operating Deadline
or fails to remain Operating thereafter, except (i) as the hours of operation of
the Black Hawk Casino may be limited by any Gaming Authority or Gaming Law or
(ii) for a period of time not to exceed 30 days during any 45-day period and not
to exceed 60 days during any one-year period; provided, however, that, in any
event, there shall not be an Event of Default under this clause if the failure
to remain Operating during such period results from an Event of Loss pursuant to
the terms of this Indenture.
Section 6.02. Acceleration, Etc.
------------------
If any Event of Default (other than an Event of Default specified in clause
(i) or (j) of Section 6.01 hereof with respect to the Company, any Restricted
Subsidiary that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary)
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Upon any such declaration, the Notes shall become
due and payable immediately. Notwithstanding the foregoing, if an Event of
Default specified in clause (i) or (j) of Section 6.01 hereof occurs with
respect to the Company, any Restricted Subsidiary that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, all outstanding Notes shall be due and
payable immediately without further action or notice. In the case of any Event
of Default occurring by reason of any willful action or inaction taken or not
taken by or on behalf of the Company with the intention of avoiding payment of
the premium that the Company would have had to pay if the Company then had
elected to redeem the Notes pursuant to Section 3.07 hereof, an equivalent
premium shall also become and be immediately due and payable to the extent
permitted by law upon the acceleration of the Notes. If an Event of Default
occurs prior to March 15, 2002 , by reason of any willful action (or inaction)
taken (or not taken) by or on behalf of the Company with the intention of
avoiding the prohibition on redemption of the Notes prior to March 15, 2002 ,
then the premium specified in this Indenture shall also become immediately due
and payable to the extent permitted by law upon the acceleration of the Notes.
Section 6.03. Other Remedies
--------------
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
Interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture and the Collateral Documents.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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Section 6.04. Waiver of Past Defaults
-----------------------
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or Interest
on, the Notes (including in connection with an offer to purchase) (provided,
however, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
Section 6.05. Control by Majority
-------------------
Holders of a majority in principal amount of the then outstanding Notes may
direct the time, method and place of conducting any proceeding for exercising
any remedy available to the Trustee or exercising any trust or power conferred
on it. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture that the Trustee determines may be unduly prejudicial
to the rights of other Holders of Notes or that may involve the Trustee in
personal liability and the Trustee may require satisfactory indemnity prior to
taking any action.
Section 6.06. Limitation on Suits
-------------------
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then outstanding
Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 15 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 15-day period the Holders of a majority in principal amount
of the then outstanding Notes do not give the Trustee a direction inconsistent
with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
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Section 6.07. Rights of Holders of Notes to Receive Payment
---------------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and Interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder;
provided that a Holder shall not have the right to institute any such suit for
the enforcement of payment if and to the extent that the institution or
prosecution thereof or the entry of judgment therein would, under applicable
law, result in the surrender, impairment, waiver or loss of the Lien of the
Indenture upon any property subject to such Lien.
Section 6.08. Collection Suit by Trustee
--------------------------
If an Event of Default specified in Section 6.01(a) or (b) hereof occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and Interest remaining
unpaid on the Notes and Interest on overdue principal and, to the extent lawful,
Interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim
--------------------------------
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
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Section 6.10. Priorities
----------
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof and amounts due to the Trustee under the
Collateral Documents, including without limitation, the Cash
Collateral and Disbursement Agreement, including payment of all
reasonable compensation, expense and liabilities incurred, and all
advances made, by the Trustee and the costs and expenses of
collection;
Second: (a) to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium and Liquidated Damages, if any, and
Interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal,
premium and Liquidated Damages, if any and Interest, respectively, and
(b) to Hyatt Gaming to the extent required by Section 3.7 of the
Intercreditor Agreement with respect to proceeds from the Advance
Disbursement Account;
Third: to Hyatt Gaming for amounts due and unpaid on the Second
Mortgage Notes for principal, premium and Liquidated Damages, if any,
and Interest, ratably, without preference or priority of any kind
according to the amounts due and payable on Second Mortgage Notes for
Principal, Premium and Liquidated Damages, if any and Interest,
respectively; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs
---------------------
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section does
not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to
Section 6.07 hereof, or a suit by Holders of more than 10% in principal amount
of the then outstanding Notes.
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ARTICLE 7.
TRUSTEE
-------
Section 7.01. Duties of Trustee
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Collateral Documents and the
Trustee need perform only those duties that are specifically set forth in
this Indenture and the Collateral Documents and no others, and no implied
covenants or obligations shall be read into this Indenture or any
Collateral Document against the Trustee; and
(c) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture and the
Collateral Documents. However, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the form required
under this Indenture.
(d) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(e) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c) and (e) of this Section.
(f) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at
84
the request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(g) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02. Rights of Trustee
-----------------
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture or any
Collateral Document, any demand, request, direction or notice from the Company
shall be sufficient if signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
Section 7.03. Individual Rights of Trustee
----------------------------
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
85
Section 7.04. Trustee's Disclaimer
--------------------
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture or any Collateral Document, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture or any Collateral Document other than its
certificate of authentication.
Section 7.05. Notice of Defaults, Etc.
------------------------
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee, the Trustee shall mail to Holders of Notes a
notice of the Default or Event of Default within 30 days after it occurs;
provided, however, that in the event that the Trustee receives any notice
pursuant to any of the Collateral Documents or the Intercreditor Agreement or if
a Default has occurred pursuant to Section 6.01(f),and the Trustee has actual
knowledge of such default, the Trustee will telecopy to Holders of Notes such
notice within three days of receipt of such notice and within such three-day
period shall mail a copy of such notice to all Holders. Except in the case of a
Default or Event of Default in payment of principal of, premium, if any,
Interest or Liquidated Damages on any Note, the Trustee may withhold the notice
if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of the
Notes.
Section 7.06. Reports by Trustee to Holders of the Notes
------------------------------------------
(a) Within 60 days after each May 15 beginning with the May 15 following
the Closing Date, and for so long as Notes remain outstanding, the Trustee shall
mail to the Holders of the Notes a brief report dated as of such reporting date
that complies with TIA ss 313(a) (but if no event described in TIA ss 313(a) has
occurred within the twelve months preceding the reporting date, no report need
be transmitted). The Trustee also shall comply with TIA ss 313(b)(2). The
Trustee shall also transmit by mail all reports as required by TIA ss 313(c).
(b) A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
(c) At the expense of the Company, the Trustee or, if the Trustee is not
the Registrar, the Registrar, shall report the names of record holders of the
Notes to any Gaming Authority when requested to do so by the Company.
86
(d) At the express direction of the Company and at the Company's expense,
the Trustee
shall provide any Gaming Authority with:
(i) copies of all notices, reports and other written communications
which the Trustee gives to Holders;
(ii) a list of all of the Holders promptly after the original issuance
of the Notes and periodically thereafter if the Company so directs;
(iii) notice of any Default under this Indenture or any Collateral
Document, any acceleration of the Indebtedness evidenced hereby, the
institution of any legal actions or proceedings before any court or
governmental authority in respect of a Default or Event of Default
hereunder;
(iv) notice of the removal or resignation of the Trustee within five
Business Days of the effectiveness thereof;
(v) notice of any transfer or assignment of rights under this
Indenture or any Collateral Document known to the Trustee within five
Business Days thereof; and
(vi) a copy of any amendment to the Notes or this Indenture within
five Business Days of the effectiveness thereof.
(e) To the extent requested by the Company and at the Company's expense,
the Trustee shall cooperate with any Gaming Authority in order to provide such
Gaming Authority with the information and documentation requested and as
otherwise required by applicable law.
Section 7.07. Compensation and Indemnity
--------------------------
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture, the Collateral Documents and
services thereunder. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Company shall reimburse
the Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture and the
Collateral Documents, including the costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) and defending itself
against any claim (whether asserted by the Company or any Holder or any other
person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence or bad faith. The Trustee shall
87
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company shall not relieve the Company of
its obligations hereunder. The Company shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent, which consent shall
not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture and the Collateral Documents.
To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and Interest on
particular Notes previously for payment. Such Lien shall survive the
satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(i) or (j) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss 313(b)(2) to the
extent applicable.
Section 7.08. Replacement of Trustee
----------------------
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section. The Trustee may resign in writing at
any time and be discharged from the trust hereby created by so notifying the
Company. The Holders of a majority in principal amount of the then outstanding
Notes may remove the Trustee by so notifying the Trustee and the Company in
writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
88
If any Gaming Authority requires a Trustee to be approved, licensed or qualified
and the Trustee fails or declines to do so, such approval, license or
qualification shall be obtained upon the request of, and at the expense of, the
Company unless the Trustee declines to do so, or, if the Trustee's relationship
with the Company may, in the Company's discretion, jeopardize any material
gaming license or franchise or right or approval granted thereto, the Trustee
shall resign, and, in addition, the Trustee may at its option resign if the
Trustee in its sole discretion determines not to be as approved, licensed or
qualified.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder who has been a Holder
for at least six months, fails to comply with Section 7.10 hereof, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders. The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Xxxxxx, etc.
---------------------------------
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition. This
Indenture shall always have a Trustee who satisfies the requirements of TIA
ss310(a)(1), (2) and (5). The Trustee is subject to TIA ss310(b).
89
Section 7.11. Preferential Collection of Claims Against Company
-------------------------------------------------
The Trustee is subject to TIA ss 311(a), excluding any creditor
relationship listed in TIA ss 311(b). A Trustee who has resigned or been removed
shall be subject to TIA ss311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
----------------------------------------
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance
--------------------------------------------------------
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article Eight. Upon
either Legal Defeasance or Covenant Defeasance, the security interests in
Collateral shall be terminated pursuant to Section 10.08 hereof.
Section 8.02. Legal Defeasance and Discharge
------------------------------
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, Liquidated Damages, if any, and Interest on
such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.
90
Section 8.03. Covenant Defeasance
-------------------
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Article IV (other than Sections
4.01, 4.02, 4.05, 4.22 and 4.25 and Section 5.01 hereof with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
hereof are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Company's exercise under Section
8.01 hereof of the option applicable to this Section 8.03, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(c) through 6.01(h), 6.01(k) through 6.01(m) hereof shall not constitute
Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance
------------------------------------------
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders, cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, and Interest and Liquidated Damages, if any, on the
outstanding Notes on the stated maturity or on the applicable redemption date,
as the case may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(b) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that (i) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (ii) since the Closing Date, there
has been a change in the applicable federal income tax law, in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm that,
the Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;
91
(c) in the case of Covenant Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel in the United States reasonably acceptable to
the Trustee confirming that the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result of
such Covenant Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be continuing on
the date of such deposit (other than a Default or Event of Default resulting
from the borrowing of funds to be applied to such deposit) or insofar as Events
of Default from bankruptcy or insolvency events are concerned, at any time in
the period ending on the 91st day after the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(f) the Company must have delivered to the Trustee an Opinion of Counsel to
the effect that, assuming no intervening bankruptcy of the Company between the
date of deposit and the 91st day following deposit, after the 91st day following
the deposit, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally;
(g) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders over the other creditors of the Company with the intent
of defeating, hindering, delaying or defrauding creditors of the Company or
others; and
(h) the Company must deliver to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent relating to the
Legal Defeasance or the Covenant Defeasance have been complied with.
Section 8.05. Deposited Money and Government Securities to be Held in
Trust; Other Miscellaneous Provisions.
---------------------------------------------------------------------------
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
92
become due thereon in respect of principal, premium, if any, and Interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. Repayment to Company
--------------------
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
Interest on any Note and remaining unclaimed for two years after such principal,
and premium, if any, or Interest has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Company.
Section 8.07. Reinstatement
-------------
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or Liquidated Damages, if any, or
Interest on any Note following the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money held by the Trustee or Paying Agent.
93
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
--------------------------------
Section 9.01. Without Consent of Holders of Notes
-----------------------------------
Notwithstanding Section 9.02 of this Indenture, without the consent of any
Holder of Notes, the Company and the Trustee may amend or supplement this
Indenture or the Notes :
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Notes by a successor to the Company pursuant to Article 5 hereof;
(d) to make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the legal rights
hereunder of any Holder;
(e) to comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA;
(f) to provide for the issuance of Additional Notes in accordance with the
limitations set forth in this Indenture as of the Closing Date; or
(g) to provide for additional Subsidiary Guarantees as set forth in Section
4.20 hereof.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes
--------------------------------
Except as provided below in this Section 9.02, the Company and the Trustee
may amend or supplement this Indenture (including Sections 3.10, 4.10, 4.28 and
4.29 hereof) and the Notes with the consent of the Holders of at least a
majority in principal amount of the Notes (including Additional Notes, if any)
then outstanding (including consents obtained in connection with a tender offer
or exchange offer for, or purchase of, the Notes), and, subject to Sections 6.04
and 6.07 hereof, any existing Default or Event of Default (other than a Default
or Event of Default in the payment of the principal of, premium, if any, or
Interest on the Notes, except a payment default resulting from an acceleration
94
that has been rescinded) or compliance with any provision of this Indenture or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes). Without the consent of at least 66-2/3% in aggregate principal amount of
the Notes then outstanding, an amendment or waiver may not affect the Liens in
favor of the Trustee and the Holders created under the Collateral Documents in a
manner adverse to the Holders or release all or any material portion of the
Collateral, in each case, other than pursuant to the release of Collateral in
accordance with the provisions of this Indenture and of the applicable
Collateral Documents. Upon the request of the Company accompanied by a
resolution of its Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of such
amended or supplemental Indenture unless such amended or supplemental Indenture
directly affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Notes. However, without the consent of each Holder affected, an
amendment or waiver under this Section 9.02 may not (with respect to any Notes
held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to an
amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter or waive any of the provisions with respect to the redemption of the
Notes, except as provided above with respect to Sections 3.10, 4.10, 4.28 and
4.29 hereof;
(c) reduce the rate of or change the time for payment of Interest on any
Note;
(d) waive a Default or Event of Default in the payment of principal of, or
Interest or premium, or Liquidated Damages, if any, on the Notes (except a
rescission of acceleration of the Notes by the Holders of at least a majority in
aggregate principal amount of the Notes and a waiver of the payment default that
resulted from such acceleration);
95
(e) make any Note payable in money other than that stated in the Notes;
(f) make any change in the provisions of this Indenture relating to waivers
of past Defaults or the rights of Holders of Notes to receive payments of, or
Interest or premium or Liquidated Damages, if any, on the Notes;
(g) waive a redemption payment with respect to any Note (other than a
payment required by Sections 3.10, 4.10, 4.28 and 4.29 hereof); or
(h) make any change in the foregoing amendment and waiver provisions.
Section 9.03. Compliance with Trust Indenture Act
-----------------------------------
Every amendment or supplement to this Indenture or the Notes shall be set
forth in a amended or supplemental Indenture that complies with the TIA as then
in effect.
Section 9.04. Revocation and Effect of Consents
---------------------------------
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Xxxxxx's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes
--------------------------------
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
--------------------------------
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article Nine if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
96
protected in relying upon, in addition to the documents required by Section
11.04 hereof, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
ARTICLE 10.
COLLATERAL AND SECURITY
-----------------------
Section 10.01. Security
--------
The Company agrees that the due and punctual payment of the principal of
and Interest and premium, if any, and Liquidated Damages, if any, on the Notes
when and as the same shall be due and payable, whether on an Interest Payment
Date, at maturity, by acceleration, repurchase, redemption or otherwise, and
Interest on the overdue principal of and Interest and Liquidated Damages (to the
extent permitted by law), if any, on the Notes and performance of all other
obligations of the Company to the Holders of Notes or the Trustee under this
Indenture and the Notes, according to the terms hereunder or thereunder, shall
be ratably secured by a Lien on the Collateral owned by the Company. Each Holder
of Notes, by its acceptance thereof, consents and agrees to the terms of the
Collateral Documents (including, without limitation, the provisions providing
for foreclosure and release of Collateral) as the same may be in effect or may
be amended from time to time in accordance with its terms and authorizes and
directs the Trustee to enter into the Collateral Documents and to perform its
obligations and exercise its rights thereunder in accordance therewith. The
Company shall deliver to the Trustee copies of all documents executed pursuant
to this Indenture and the Collateral Documents, and shall do or cause to be done
all such acts and things as may be necessary or proper, or as may be required by
the provisions of the Collateral Documents, to assure and confirm to the Trustee
the security interest in the Collateral contemplated hereby, as from time to
time constituted, so as to render the same available for the security and
benefit of this Indenture and of the Notes secured hereby, according to the
intent and purposes herein expressed. The Company shall take, or shall cause its
Subsidiaries to take, upon request of the Trustee, any and all actions
reasonably required to create and maintain, as security for the Obligations of
the Company hereunder, a valid and enforceable perfected first priority Lien in
and on all the Collateral, in favor of the Trustee for the benefit of the
Holders of Notes, superior to and prior to the rights of all third Persons and
subject to no other Liens than Permitted Liens, including executing, as
applicable, a Pledge Agreement in the form attached hereto as Exhibit F, and a
Collateral Assignment in the form attached hereto as Exhibit G.
Section 10.02. Recording and Opinions
----------------------
(a) The Company shall cause the applicable Collateral Documents including
the Deed of Trust and any financing statements, fixture filings, intellectual
property filings, all amendments or supplements to each of the foregoing and any
other similar security documents as necessary, to be registered, recorded and
filed and/or re-recorded, re-filed and renewed in such manner and in such place
or places, if any, as may be required by law or reasonably requested by the
97
Trustee in order fully to preserve and protect the Liens, and the priority
thereof, securing the obligations under the Notes pursuant to the Collateral
Documents.
(b) The Company shall furnish to the Trustee:
(i) Promptly after the execution and delivery of this Indenture, and
promptly after the execution and delivery of any supplemental indenture or
other amendment to any Collateral Document, an Opinion of Counsel in the
United States either (A) stating that in the opinion of such counsel, this
Indenture, the Collateral Documents and all other instruments of further
assurance or amendment have been properly recorded, registered and filed to
the extent necessary to make effective the Lien intended to be created by
such Collateral Documents and other instruments and reciting the details of
such action or refer to prior Opinions of Counsel in which such details are
given, and stating that, as to such Collateral Documents and such other
instruments, such recording, registering and filing are the only
recordings, registering and filings necessary to give notice thereof and
that no re- recordings, re-registering or re-filings are necessary to
maintain such notice, and further stating that all financing statements,
continuation statements, fixture filings and intellectual property filings
have been executed and filed that are necessary fully to preserve and
protect the rights of the Holders of Notes and the Trustee hereunder and
under the Collateral Documents and other instruments or (B) stating that,
in the opinion of such counsel, no such action is necessary to make any
other Lien created under any of the Collateral Documents effective as
intended by such Collateral Documents; and
(ii) On June 1, in each year beginning with the year 2000, an Opinion
of Counsel, dated as of such date, either (A) stating that, in the opinion
of such counsel, such action has been taken with respect to the recording,
registering, filing, re-recording, re-registering and re-filing of this
Indenture and all supplemental indentures, financing statements,
continuation statements, fixture filings, intellectual property filings, or
other instruments of further assurance as is necessary to maintain the
Liens of this Indenture, and the Collateral Documents and other instruments
until the next Opinion of Counsel is required to be rendered pursuant to
this paragraph and reciting the details of such action or referring to
prior Opinions of Counsel in which such details are given, and stating that
all financing statements, continuation statements, fixture filings,
intellectual property filings, have been executed and filed that are
necessary to preserve and protect the rights of the Holders and the Trustee
hereunder, and under the Collateral Documents and other instruments or (B)
stating that, in the opinion of such counsel, no such action is necessary
to maintain such Liens, until the next Opinion of Counsel is required to be
rendered pursuant to this paragraph.
(c) The Company shall otherwise comply with the provisions of TIA ss314(b).
98
Section 10.03. Release of Collateral
---------------------
(a) Subject to subsections (b), (c) and (d) of this Section 10.03,
Collateral may be released from the Lien and security interest created by this
Indenture and the Collateral Documents at any time or from time to time in
accordance with the provisions of the Collateral Documents or as provided
hereby. In addition, upon the request of the Company pursuant to an Officers'
Certificate certifying that all conditions precedent hereunder have been met and
stating whether or not such release is in connection with an Asset Sale, the
Trustee shall release (at the sole cost and expense of the Company) (i)
Collateral that is sold, conveyed or disposed of in compliance with the
provisions of this Indenture; provided, that if such sale, conveyance or
disposition constitutes an Asset Sale, the Company shall apply the Net Proceeds
in accordance with Section 4.10 hereof. Upon receipt of such Officers'
Certificate the Trustee shall execute, deliver or acknowledge any necessary or
proper instruments of termination, satisfaction or release to evidence the
release of any Collateral permitted to be released pursuant to this Indenture or
the Collateral Documents.
(b) No Collateral shall be released from the Lien and security interest
created by the Collateral Documents pursuant to the provisions of the Collateral
Documents unless there shall have been delivered to the Trustee the certificate
required by this Section 10.03.
(c) At any time when a Default or Event of Default shall have occurred and
be continuing and the maturity of the Notes shall have been accelerated (whether
by declaration or otherwise) and the Trustee shall have delivered a notice of
acceleration to the Trustee, no release of Collateral pursuant to the provisions
of the Collateral Documents shall be effective as against the Holders of Notes.
(d) The release of any Collateral from the terms of this Indenture and the
Collateral Documents shall not be deemed to impair the security under this
Indenture in contravention of the provisions hereof if and to the extent the
Collateral is released pursuant to the terms hereof. To the extent applicable,
the Company shall cause TIA ss 313(b), relating to reports, and TIA ss 314(d),
relating to the release of property or securities from the Lien and security
interest of the Collateral Documents and relating to the substitution therefor
of any property or securities to be subjected to the Lien and security interest
of the Collateral Documents, to be complied with. Any certificate or opinion
required by TIA ss 314(d) may be made by an Officer of the Company except in
cases where TIA ss 314(d) requires that such certificate or opinion be made by
an independent Person, which Person shall be an independent engineer, appraiser
or other expert selected or approved by the Trustee in the exercise of
reasonable care.
Section 10.04. Certificates of the Company
---------------------------
The Company shall furnish to the Trustee, prior to each proposed release of
Collateral pursuant to the Collateral Documents, (i) all documents required by
TIA ss314(d) and (ii) an Opinion of Counsel, which may be rendered by internal
counsel to the Company, to the effect that such accompanying documents
constitute all documents required by TIA ss314(d). The Trustee may, to the
extent permitted by Sections 7.01 and 7.02 hereof, accept as conclusive evidence
99
of compliance with the foregoing provisions the appropriate statements contained
in such documents and such Opinion of Counsel.
Section 10.05. Certificates of the Trustee
----------------------------
In the event that the Company wishes to release Collateral in accordance
with the Collateral Documents and has delivered the certificates and documents
required by the Collateral Documents and Sections 10.03 and 10.04 hereof, the
Trustee shall determine whether it has received all documentation required by
TIA ss314(d) in connection with such release and, based on such determination
and the Opinion of Counsel delivered pursuant to Section 10.04(b) hereof, shall
deliver a certificate to the Company setting forth such determination.
Section 10.06. Authorization of Actions to Be Taken by the Trustee Under
the Collateral Documents
-----------------------------------------------------------------------------
Subject to the provisions of Section 7.01 and 7.02 hereof, the Trustee may,
in its sole discretion and without the consent of the Holders of Notes, take on
behalf of the Holders of Notes, all actions it deems necessary or appropriate in
order to (a) enforce any of the terms of the Collateral Documents and (b)
collect and receive any and all amounts payable in respect of the Obligations of
the Company hereunder. The Trustee shall have power to institute and maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Collateral by any acts that may be unlawful or in violation of the
Collateral Documents or this Indenture, and such suits and proceedings as the
Trustee may deem expedient to preserve or protect its interests and the
interests of the Holders of Notes in the Collateral (including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders of Notes or
of the Trustee).
Subject to certain gaming and bankruptcy laws, upon an Event of Default and
so long as such Event of Default continues, the Trustee may exercise in respect
of the Collateral, in addition to the other rights and remedies provided for
herein, in the Collateral Documents or otherwise available to it, all of the
rights and remedies of a secured party under the Uniform Commercial Code or
other applicable law, and the Trustee may also upon obtaining possession of the
Collateral as set forth herein, without notice to the Company, except as
specified below, sell the Collateral or any part thereof in one or more parcels
at public or private sale, at any exchange, broker's board or at any of the
Trustee's offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Trustee may deem commercially reasonable. The
Company acknowledges and agrees that any such private sale may result in prices
and other terms less favorable to the seller than if such a sale were a public
sale. The Company agrees that, to the extent notice of sale shall be required by
law, at least ten days' notice to the Company of the time and place of any
public sale or the time after which any private sale is to be made shall
constitute reasonable notification. The Trustee shall not be obligated to make
any sale regardless of notice of sale having been given. The Trustee may adjourn
any public or private sale from time to time by announcement at the time and
100
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
Section 10.07. Authorization of Receipt of Funds by the Trustee Under the
Collateral Documents
------------------------------------------------------------------------------
The Trustee is authorized to receive any funds for the benefit of the
Holders of Notes distributed under the Collateral Documents, and to make further
distributions of such funds to the Holders of Notes according to the provisions
of this Indenture.
Section 10.08. Termination of Security Interest
--------------------------------
Upon the payment in full of all Obligations of the Company under this
Indenture, the Collateral Documents and the Notes, or upon Legal Defeasance or
Covenant Defeasance, the Trustee shall, at the request of the Company, deliver a
certificate to the Company stating that such Obligations have been paid in full,
and take all actions necessary to release the Liens pursuant to this Indenture
and the Collateral Documents.
Section 10.09. Cooperation Of Trustee
----------------------
In the event the Company pledges or grants a security interest in
additional Collateral, the Trustee shall cooperate with the Company in
reasonably and promptly agreeing to the form of, and executing as required, any
instruments or documents necessary to make effective the security interest in
the Collateral to be so substituted or pledged. To the extent practicable, the
terms of any security agreement or other instrument or document necessitated by
any such substitution or pledge shall be comparable to the provisions of the
existing Collateral Documents. Subject to, and in accordance with the
requirements of this Article 10 and the terms of the Collateral Documents, in
the event that the Company engages in any transaction pursuant to Section 10.3
hereof, the Trustee shall cooperate with the Company in order to facilitate such
transaction in accordance with any reasonable time schedule proposed by the
Company, including delivering and releasing the Collateral in a prompt and
reasonable manner.
Section 10.10. Collateral Agent
----------------
The Trustee may, from time to time, appoint one or more collateral agents
hereunder ("Collateral Agents"). Each of such Collateral Agents may be delegated
any one or more of the duties or rights of the Trustee hereunder or under the
Collateral Documents or that are specified in any Collateral Documents,
including, without limitation, the right to hold any Collateral in the name of,
registered to, or in the physical possession of, such Collateral Agent, for the
ratable benefit of the Holders of the Notes. Each such Collateral Agent shall
have such rights and duties as may be specified in an agreement between the
Trustee and such Collateral Agent.
101
ARTICLE 11.
MISCELLANEOUS
-------------
Section 11.01. Trust Indenture Act Controls
----------------------------
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss318(c), the imposed duties shall control.
Section 11.02. Notices
-------
Any notice or communication by the Company or the Trustee to the others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company: Windsor Woodmont Black Hawk Resort Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxx
With a copy to: Xxxx, Xxxxxxxx, Xxxxxxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
If to the Trustee: SunTrust Bank
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
With a copy to: Xxxxxx, Xxxxxx & Xxxxxxxxx
Signature Plaza
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx Xxxxx, Esq.
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
102
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA ss 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
Section 11.03. Communication by Holders of Notes with Other Holders of
Notes
---------------------------------------------------------------------------
Holders may communicate pursuant to TIA ss 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss
312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent
--------------------------------------------------
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
Section 11.05. Statements Required in Certificate or Opinion
---------------------------------------------
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss 314(a)(4)) shall comply with the provisions of TIA ss 314(e)
and shall include:
103
(a) a statement that the Person making such certificate or opinion has read
such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
Section 11.06. Rules by Trustee and Agents
---------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 11.07. No Personal Liability of Directors, Officers, Employees and
Stockholders
-------------------------------------------------------------------------------
No past, present or future director, officer, employee, incorporator or
stockholder of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Section 11.08. Governing Law
-------------
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 11.09. No Adverse Interpretation of Other Agreements
---------------------------------------------
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
104
Section 11.10. Successors
----------
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 11.11. Severability
------------
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 11.12. Counterpart Originals
---------------------
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 11.13. Table of Contents, Headings, etc.
---------------------------------
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 11.14. Gaming and Liquor Laws
----------------------
The terms and provisions of this Indenture, including, but not limited to,
all rights and remedies of the Trustee and powers of attorney and appointment,
are expressly subject to all laws, statutes, regulations and orders affecting
limited gaming or the sale of liquor (collectively, the "Gaming and Liquor
Laws"), in the State of Colorado, which may include, but not be limited to, the
necessity for the Trustee to obtain the prior approval of the regulatory
agencies enforcing the Gaming or Liquor Laws before taking any action hereunder
and to be licensed by such regulatory agencies before exercising certain rights
and remedies hereunder.
[Signatures on following page]
105
SIGNATURES
Dated as of March 14, 2000 WINDSOR WOODMONT BLACK HAWK
RESORT CORP.
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: President
Dated as of March 14, 2000 SUNTRUST BANK, AS TRUSTEE
By: /s/ Xxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxx
Title: Authorized Signatory,
First Vice President
[Signature page to the Indenture]
106
EXHIBIT A
FORM OF NOTE
[Face of Note]
--------------------------------------------------------------------------------
This instrument has been issued with original issue discount, as such term is
defined in Section 1271 et seq. of the Internal Revenue Code of 1986, as
amended. Upon inquiry made by any holder hereof, addressed to Windsor Woodmont
Black Hawk Resort Corp. (the "Company") at 0000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, Attention Xxxxxxx Xxxxxxxxx, the Company will provide a statement setting
forth the issue price, the amount of original issue discount, the issue date and
the yield to maturity with respect to the instrument held by such holder.
This instrument is subject to the terms of a Intercreditor Subordination and
Collateral Agreement dated as of March 14, 2000, between SunTrust Bank, as
trustee, Hyatt Gaming Management, Inc. and the Company (as amended in accordance
with its terms) which is incorporated herein by reference. Notwithstanding any
statement to the contrary contained in this instrument, no payment on account of
the obligations hereunder, whether of principal or interest or otherwise, shall
be made, paid, received or accepted except in accordance with the express terms
of the Intercreditor Subordination and Collateral Agreement.
CUSIP/CINS ____________
13% [Series B] First Mortgage Notes due 2005
No. ___ $____________
Windsor Woodmont Black Hawk Resort Corp.
promises to pay to _____________________________________________________________
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on March 15, 2005.
Interest Payment Dates: March 15 and September 15
Record Dates: March 1 and September 1
Dated: March , 2000
Windsor Woodmont Black Hawk Resort Corp.
By:_____________________________________
Name:
Title:
By: ____________________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
SunTrust Bank,
as Trustee
By: __________________________________
Authorized Signatory
================================================================================
A-1
[Back of Note]
13% [Series B] First Mortgage Notes due 2005
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
[Insert the Unit Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the following legend if Regulation S Temporary Global Note:
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (00 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. Interest. Windsor Woodmont Black Hawk Resort Corp., a Colorado
corporation (the "Company"), promises to pay interest on the principal amount of
this Note at 13% per annum from March 17, 2000 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages semi-annually in arrears on March 15 and September 15 of each year, or
if any such day is not a Business Day, on the next succeeding Business Day (each
an "Interest Payment Date"). Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be September 15, 2000. The
Company shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal and premium, if any, from time to
A-2
time on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to
time on demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year of twelve 30-day months.1
2. Method of Payment. The Company will pay interest on the Notes (except
defaulted interest) and Liquidated Damages to the Persons who are registered
Holders of Notes at the close of business on the March 1 or September 1 next
preceding the Interest Payment Date, even if such Notes are canceled after such
record date and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture with respect to defaulted interest. The Notes will
be payable as to principal, premium and Liquidated Damages, if any, and interest
at the office or agency of the Company maintained for such purpose within or
without the City and State of New York, or, at the option of the Company,
payment of interest and Liquidated Damages may be made by check mailed to the
Holders at their addresses set forth in the register of Holders, and provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest, premium and Liquidated Damages on,
all Global Notes and all other Notes the Holders of which shall have provided
wire transfer instructions to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, SunTrust Bank, the Trustee under
the Indenture, will act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to any Holder. The Company or any
of its Subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Notes under an Indenture dated as of
March 14, 2000 ("Indenture") between the Company and the Trustee. The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code xx.xx. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders
are referred to the Indenture and such Act for a statement of such terms. To the
extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The
Notes are senior secured obligations of the Company limited to $135.0 million in
aggregate principal amount.
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Company shall not have the option to redeem the Notes prior to March 15, 2002.
Thereafter, the Company may redeem all or a part of the Notes upon not less than
30 nor more than 60 days' notice, at the redemption
--------
1 [If Regulation S Temporary Global Note, add the following paragraph:
Until this Regulation S Temporary Global Note is exchanged for one or more
Regulation S Permanent Global Notes, the Holder hereof shall not be entitled to
receive payments of interest hereon; until so exchanged in full, this Regulation
S Temporary Global Note shall in all other respects be entitled to the same
benefits as other Senior Subordinated Notes under the Indenture.]
A-3
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on March 15 of the years indicated below:
Year Percentage
---- ----------
2002............................................ 113.000%
2003............................................ 108.666%
2004............................................ 104.333%
2005 (maturity)................................. 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 5,
at any time prior to March 15, 2002, the Company may redeem up to 35% of the
aggregate principal amount of Notes at a redemption price equal to 113% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, to the redemption date with the net cash proceeds of
a Equity Offering; provided that (i) at least 65% in aggregate principal amount
of the Notes originally issued remain outstanding immediately after the
occurrence of such redemption and (ii) the redemption must occur within 60 days
of the date of the closing of such Equity Offering.
6. Gaming Redemption
Notwithstanding the provisions of subparagraph (a) of paragraph 5 above, if
any Gaming Authority requires that a Holder or beneficial owner of notes must be
licensed, qualified or found suitable under any applicable gaming law and such
Holder or beneficial owner fails to apply for a license, qualification or
finding of suitability within 30 days after being requested to do so by such
Gaming Authority (or such lesser period that may be required by such Gaming
Authority), or if such Holder or such beneficial owner is notified by such
Gaming Authority that such Holder or beneficial owner shall not be so licensed,
qualified or found suitable, the Company will have the right, at its option: (i)
to require such Holder or beneficial owner to dispose of such Holder's or
beneficial owner's Notes within 30 days (or such earlier date as may be ordered
by such Gaming Authority) of (x) the termination of the period described above
for such Holder or beneficial owner to apply for a license, qualification or
finding of suitability, or (y) receipt of the notice from such Gaming Authority
that such holder or beneficial owner shall not be licensed, qualified or found
suitable by such Gaming Authority; or (ii) to redeem the Notes of such holder of
beneficial owner at a redemption price equal to the lesser of the principal
amount thereof or the price at which such holder or beneficial owner acquired
such notes, together with, in either case, accrued and unpaid interest thereon
to the earlier of the date of redemption or such earlier date as may be required
by such Gaming Authority or the date of the finding of unsuitability by such
Gaming Authority, which may be less than 30 days following the notice of
redemption, if so ordered by such Gaming Authority.
7. Mandatory Redemption.
Except as set forth in paragraphs 6 above and 8 below, the Company shall
not be required to make mandatory redemption payments with respect to the Notes.
8. Repurchase at Option of Holder.
(a) If the Company or a Subsidiary consummates any Asset Sales, pursuant to
Section 4.10 of the Indenture, when the aggregate amount of Excess Proceeds
exceeds $5 million, the Company will be required to make an offer (an "Asset
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Sale Offer") to all Holders of Notes pursuant to Section 3.10 of the Indenture
to purchase the maximum principal amount of Notes that may be purchased out of
the Excess Proceeds at an offer price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest to the date of
purchase, which date will be no less than 30 nor more than 60 days after the
date of the Asset Sale Offer, in accordance with the procedures set forth in
Section 3.10 of the Indenture. To the extent that the aggregate amount of Notes
tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Company (or such Subsidiary) may repay any principal amount, or accrued and
unpaid interest thereon, owing pursuant to the city improvement bonds, the FF&E
Financing and/or the Second Mortgage Notes (not to exceed, in the aggregate, the
amount by which the Excess Proceeds exceeds the aggregate principal amount of
Notes, plus accrued and unpaid interest thereon, tendered in such Asset Sale
Offer) and may, subject to the provisions of the Indenture and the Collateral
Documents, use any remaining Excess Proceeds for any purpose not otherwise
prohibited by the Indenture and the Collateral Documents. If the aggregate
principal amount of Notes surrendered by Holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes to be purchased in the
manner set forth in Section 3.02 of the Indenture. Holders of Notes that are the
subject of an offer to purchase will receive an Asset Sale Offer from the
Company prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Notes.
(b) Within 120 days after the end of each Operating Year of the Company,
beginning with the first Operating Year after the Black Hawk Casino becomes
operating, the Company will make an offer to all Holders (an "Excess Cash Flow
Offer") to purchase the maximum principal amount of Notes that is an integral
multiple of $1,000 that may be purchased with (i) 50% of the Company's Excess
Cash Flow in respect of the four consecutive fiscal quarters ending on or
immediately following the last day of such Operating Year plus (ii) any amounts
disbursed from the Cash Collateral Accounts and the Hyatt Cash Collateral
Accounts pursuant to Section 11 of the Cash Collateral and Disbursement
Agreement that the Company elects, in its sole discretion, to include any Excess
Cash Flow Offer (the sum of the foregoing clauses (i) and (ii), collectively,
the "Excess Cash Flow Offer Amount"), at a purchase price in cash equal to 101%
of the principal amount of Notes to be purchased, plus accrued and unpaid
interest to the purchase date (the "Excess Cash Flow Purchase Price"), in
accordance with the procedures set forth in Section 3.10 of the Indenture. To
the extent that the aggregate principal amount of Notes tendered pursuant to any
Excess Cash Flow Offer is less than the Excess Cash Flow Offer Amount with
respect thereto, the Company may repay any principal amount, or accrued and
unpaid interest thereon, owing pursuant to the City Improvement Bonds, the FF&E
Financing and/or the Second Mortgage Notes (not to exceed, in the aggregate, the
amount by which the Excess Cash Flow Offer amount exceeds 101% of the aggregate
principal amount of Notes, plus accrued and unpaid interest thereon, tendered in
such Excess Cash Flow Offer) and may, subject to the other provisions of the
Indenture and the Collateral Documents, use any remaining excess cash flow for
general corporate purposes and the amount of Excess Cash Flow shall be reset at
zero. Holders of Notes that are the subject of an offer to purchase shall
receive an Excess Cash Flow Offer from the Company prior to any related purchase
date and may elect to have such notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes.
(c) Subject to the conditions set forth below, within 90 days after any
Event of Loss with respect to any Collateral, the Company or the affected
Restricted Subsidiary of the Company, as the case may be, shall so notify the
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Trustee, describing in such notice the nature of the Event of Loss in reasonable
detail, and shall (i) apply the Net Loss Proceeds from such Event of Loss to the
rebuilding, repair, replacement or construction of the improvements to the Black
Hawk Casino, with no concurrent obligation to make any offer to purchase any
Notes; (ii) if the Casino is not Operating and the Net Loss Proceeds exceed $1.0
million, deposit the Net Loss Proceeds in the Construction Disbursement Account
to be disbursed in accordance with the procedures set forth in the Disbursement
Agreement; (iii) if the Net Loss Proceeds exceed $1.0 million, deliver to the
Trustee within 60 days after such Event of Loss a written opinion from a
nationally recognized architect that the Black Hawk Casino, with at least the
Minimum Facilities, can be rebuilt, repaired, replaced or constructed and
Operating within not more than 360 days after the Event of Loss (but in no event
later than the date that is six months prior to the maturity date of the Notes);
and (iv) if the Net Loss Proceeds exceed $1.0 million, deliver an Officers'
Certificate certifying that the Company has available from Net Loss Proceeds or
other sources sufficient funds to complete the rebuilding, repair, replacement
or construction described in clause (i) above and in accordance with clause
(iii) above.
Upon the occurrence of an Event of Loss with respect to any Collateral
having a fair market value or a replacement cost greater than $20 million, or if
upon the occurrence of any Event of Loss the Company is unable or fails to
furnish the written opinion from a nationally recognized architect as required
by clause (iii) above, then the Company shall, simultaneously with the delivery
of the notice to the Trustee as set forth above, deliver to the Holders a notice
(an "Event of Loss Notice") providing for the following: an option either (x) to
allow the Company to apply the Net Loss Proceeds to the rebuilding, repair,
replacement or construction of the improvements to the Black Hawk Casino or (y)
to require that the Company purchase the maximum principal amount of Notes that
may be purchased out of the Net Loss Proceeds, at a purchase price in cash in an
amount equal to 100% of the principal amount thereof, plus accrued and unpaid
Interest and Liquidated Damages, if any, thereon to the date of purchase (an
"Event of Loss Offer").
If Holders of a majority of the aggregate principal amount of the Notes
then outstanding provide a written request (an "Event of Loss Acceptance")
within 30 days after the Event of Loss Notice that the Company effect an Event
of Loss Offer, then the Company shall, within 10 days after the Event of Loss
Acceptance, effect an Event of Loss Offer. The Event of Loss Offer shall be
conducted in accordance with Section 3.10 of the Indenture and shall be
consummated not less than 30 nor more than 60 days after the date of such Event
of Loss Offer. To the extent that the aggregate principal amount of Notes
tendered pursuant to an Event of Loss Offer exceeds the Net Loss Proceeds, the
Trustee shall select the Notes to be purchased in the manner described under
Section 3.02 hereof. To the extent that the aggregate amount of Notes tendered
pursuant to an Event of Loss Offer is less than the Net Loss Proceeds, the
Company may repay any principal amount, or accrued and unpaid interest thereon,
owing pursuant to the City Improvement Bonds, the FF&E Financing and/or the
Second Mortgage Notes (not to exceed, in the aggregate, the amount by which the
Net Loss Proceeds exceeds the aggregate principal amount of Notes, plus accrued
and unpaid interest thereon, tendered in such Event of Loss Offer) and may,
subject to the other provisions of the Indenture and the Collateral Documents,
use any remaining Net Loss Proceeds for any purpose not otherwise prohibited by
the Indenture.
9. Notice of Redemption. Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Notes are to be redeemed at its registered address (unless a shorter period is
required by a Gaming Authority with respect to a redemption pursuant to
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Paragraph 6 of this Note). Notes in denominations larger than $1,000 may be
redeemed in part but only in whole multiples of $1,000, unless all of the Notes
held by a Holder are to be redeemed. On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.
10. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.2
11. Persons Deemed Owners. The registered Holder of a Note may be treated
as its owner for all purposes.
12. Amendment, Supplement and Waiver. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the Notes then outstanding
(including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Notes), and any existing default or
compliance with any provision of the Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount of the Notes then
outstanding (including consents obtained in connection with a tender offer or
exchange offer for Notes). Without the consent of the Holders of at least 66
2/3% in aggregate principal amount of the Notes then outstanding, an amendment
or waiver may not affect the Liens in favor of the Trustee and the Holders
created under the Collateral Documents in a manner adverse to the Holders (other
than pursuant to the release of Collateral in accordance with the provisions of
the Indenture and of the applicable Collateral Documents) or release all or any
material portion of the Collateral. Without the consent of any Holder of a Note,
the Indenture or the Notes may be amended or supplemented to cure any ambiguity,
defect or inconsistency, to provide for uncertificated Notes in addition to or
in place of certificated Notes, to provide for the assumption of the Company's
obligations to Holders of the Notes in case of a merger or consolidation, to
make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder, to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the Trust
Indenture Act, to provide for the issuance of additional notes in accordance
with the limitations set forth in the Indenture or to provide for additional
Subordinated Guarantors.
--------
2 [If Regulation S Temporary Global Note, add the following paragraph: This
Regulation S Temporary Global Note is exchangeable in whole or in part for one
or more Global Notes only (i) on or after the termination of the 40-day
restricted period (as defined in Regulation S) and (ii) upon presentation of
certificates (accompanied by an opinion of counsel, if applicable) required by
Article 2 of the Indenture. Upon exchange of this Regulation S Temporary Global
Note for one or more Global Notes, the Trustee shall cancel this Regulation S
Temporary Global Note.]
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13. Defaults and Remedies. Events of default include: (a) default for 30
days in the payment when due of Interest on, or Liquidated Damages, if any, with
respect to, the Notes; (b) default in the payment when due of principal of or
premium, if any, on the Notes; (c) failure to comply with any of the provisions
of Section 4.07, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18,
4.19, 4.20, 4.21, 4.25, 4.28, 4.29, 4.30, 4.31, 4.32 or 5.01 of the Indenture;
(d) a Change of Control shall occur; (e) the Company or any of its Restricted
Subsidiaries for 30 days after notice thereof fails to comply with the
provisions of any of the other agreements in the Indenture not set forth in
clause (c) above; (f) a default occurs under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Subsidiaries) whether such Indebtedness or guarantee now exists, or is created
after the Closing Date, if that default: (i) is caused by a failure to pay
principal of, or interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of such
default (a "Payment Default"); or (ii) results in the acceleration of such
Indebtedness prior to its express maturity, and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $1.0 million or more; (g) the
Company or any of its Restricted Subsidiaries fails to pay final judgments
aggregating in excess of $5.0 million, which judgments are not paid, discharged
or stayed for a period of 60 days; (h) (i) the Company, the LLC or any of their
respective Affiliates breaches any material representation or warranty in the
Collateral Documents or any certificates delivered in connection therewith, (ii)
the Company, the LLC or any of their respective Affiliates fails after written
notice thereof to comply with any material covenant or agreement set forth in
the Collateral Documents, (iii) the Company, the LLC or their respective
Affiliates repudiates any of its obligations under the Collateral Documents,
(iv) the Collateral Documents become unenforceable against the Company, the LLC
or their respective Affiliates or perfection or priority of the Liens granted by
the Company, the LLC or their respective Affiliates thereunder is lost for any
reason, which in the case of clauses (i) and (ii) remains uncured for a period
of 30 days after written notice specifying such breach or default; (i) the
Company or any of its Significant Subsidiaries or any group of Subsidiaries
that, taken as a whole, would constitute a Significant Subsidiary pursuant to or
within the meaning of Bankruptcy Law: (i) commences a voluntary case, (ii)
consents to the entry of an order for relief against it in an involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property, (iv) makes a general assignment for the
benefit of its creditors, or (v) generally is not paying its debts as they
become due; or (j) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (i) is for relief against the Company or any of
its Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary in an involuntary case; (ii)
appoints a custodian of the Company or any of its Significant Subsidiaries or
any group of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary or for all or substantially all of the property of the Company or any
of its Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary; or (iii) orders the
liquidation of the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; and the order or decree remains unstayed and in effect for 60
consecutive days; (k) the revocation, termination, suspension or other cessation
of effectiveness for a period of more than 90 consecutive days of any Gaming
License results in the cessation or suspension of gaming operations at any
Gaming Facility; or (l) the Black Hawk Casino fails to be Operating by
A-8
the Operating Deadline or fails to remain Operating thereafter, except (a) as
the hours of operation of the Black Hawk Casino may be limited by any Gaming
Authority or Gaming Law or (b) for a period of time not to exceed 30 days during
any 45-day period and not to exceed 60 days during any one-year period;
provided, however, that, in any event, there shall not be an Event of Default
under this clause if the failure to remain Operating during such period results
from an Event of Loss pursuant to the terms of this Indenture. If any Event of
Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable immediately without further action
or notice. Holders may not enforce the Indenture or the Notes except as provided
in the Indenture. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. In the event the Trustee is required by the
holders or otherwise required by the Indenture or the collateral documents to
take any action which may reasonably result in environmental-related liability
to the Trustee, the Trustee may require additional indemnities regarding such
liability. If such indemnities are not obtained, the Trustee may resign. In the
case of any event of default occurring by reason of any willful action (or
inaction) taken (or not taken) by or on behalf of the Company with the intention
of avoiding payment of the premium that the Company would have had to pay if the
company then had elected to redeem the notes pursuant to the optional redemption
provisions of the Indenture, an equivalent premium will also become and be
immediately due and payable to the extent permitted by law upon the acceleration
of the Notes. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of interest on, or the principal of, premium and Liquidated
Damages, if any, on the Notes. The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the Company is
required upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default.
14. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
15. No Recourse Against Others. A director, officer, employee, incorporator
or stockholder, of the Company, as such, shall not have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.
16. Security. The due and punctual payment of the principal of, interest
and premium, if any, and liquidated damages, if any, on the Notes when and as
the same shall be due and payable, whether on an interest payment date, at
maturity, by acceleration, repurchase, redemption or otherwise, and interest and
Liquidated Damages (to the extent permitted by law), if any, on the Notes and
performance of all other obligations of the Company to the Holders of Notes or
the Trustee under the Indenture and the Notes, according to the terms hereunder
or thereunder, shall be ratably secured by a lien on the collateral owned by the
Company, subject to certain permitted liens. Each Holder of Notes, by its
acceptance thereof, consents and agrees to the terms of the Collateral
A-9
Documents (including, without limitation, the provisions providing for
foreclosure and release of collateral) as the same may be in effect or may be
amended from time to time in accordance with its terms and authorizes and
directs the Trustee to enter into the collateral documents and to perform its
obligations and exercise its rights thereunder in accordance therewith.
17. Authentication. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
18. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
19. Additional Rights of Holders of Restricted Global Notes and Restricted
Definitive Notes. In addition to the rights provided to Holders of Notes under
the Indenture, Holders of Restricted Global Notes and Restricted Definitive
Notes shall have all the rights set forth in the A/B Exchange Registration
Rights Agreement dated as of March 14,2000, between the Company and the parties
named on the signature pages thereof or, in the case of additional notes,
holders of restricted global notes and restricted definitive notes shall have
the rights set forth in one or more registration rights agreements, if any,
between the Company and the other parties thereto, relating to the rights given
by the Company to the purchasers of any additional notes (collectively, the
"Registration Rights Agreement").
20. CUSIP Numbers. The Company in issuing the notes, may use a "cusip"
number. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Windsor Woodmont Black Hawk Resort Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
A-10
Assignment Form
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
--------------------------------------------------------------------------------
(Insert assignee's Soc. Sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type Assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: ____________________________
Your Signature: ____________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*: __________________________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.10, 4.28 or 4.29 of the Indenture, check the appropriate box below:
[ ] Section 4.10 [ ] Section 4.28 [ ] Section 4.29
If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.10, 4.28 or 4.29 of the Indenture, state the amount you
elect to have purchased:
$______________________________
Date: _________________________
Your Signature: ____________________________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.: ___________________________________
Signature Guarantee*: _________________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-12
SCHEDULE OF EXCHANGES OF [REGULATION S TEMPORARY
GLOBAL NOTE] [INTERESTS IN THE GLOBAL NOTE]*
The following exchanges of a part of this [Regulation S Temporary Global
Note] [Global Note] [for an interest in another Global Note, or of other
Restricted Global Notes for an interest in this Regulation S Temporary Global
Note] [for an interest in another Global Note or for a Definitive Note, or
exchanges of a part of another Global Note or Definitive Note for an interest in
this Global Note], have been made:
Principal Amount of this Signature of authorized
Amount of decrease in Amount of increase in Global Note following officer of Trustee or
Principal Amount Principal Amount of such decrease Note Custodian
Date of Exchange of this Global Note this Global Note (or increase) --------------
---------------- ------------------- ---------------- -------------
* This schedule should be included only if the Note is issued in global form.
A-13
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Windsor Woodmont Black Hawk Resort Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
SunTrust Bank
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Re: 13% First Mortgage Notes Due 2005
Reference is hereby made to the Indenture, dated as of March 14, 2000 (the
"Indenture"), between Windsor Woodmont Black Hawk Resort Corp., as issuer (the
"Company"), and SunTrust Bank, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest in
the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial interest in
the Temporary Regulation S Global Note, the Regulation S Global Note or a
Definitive Note pursuant to Regulation S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act
and, accordingly, the Transferor hereby further certifies that (i) the Transfer
is not being made to a person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made by the holder of a Temporary Regulation S Global Note prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person. Upon consummation of the
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proposed transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Global Note, the Temporary Regulation S Global Note and/or the Definitive Note
and in the Indenture and the Securities Act.
3.[ ] Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Note or a Definitive Note pursuant to any provision
of the Securities Act other than Rule 144A or Regulation S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the
Transferor hereby further certifies that it has not engaged in any general
solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive
Notes and the requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee in the form of
Exhibit D to the Indenture and (2) an Opinion of Counsel acceptable to the
Company provided by the Transferor or the Transferee (a copy of which the
Transferor has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed
on the IAI Global Note and/or the Definitive Notes and in the Indenture and
the Securities Act.
4. [ ] Check if Transferee will take delivery of a beneficial interest in
an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
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(b) [ ] Check if Transfer is Pursuant to Regulation S. (i) The Transfer is
being effected pursuant to and in accordance with Rule 903 or Rule 904 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(c) [ ] Check if Transfer is Pursuant to Other Exemption. (i) The Transfer
is being effected pursuant to and in compliance with an exemption from the
registration requirements of the Securities Act other than Rule 144, Rule 903 or
Rule 904 and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any State of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will not be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Global Notes or
Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
---------------------------------
[Insert Name of Transferor]
By:
------------------------------
Name:
Title:
Dated:
----------------------------------
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ____________ ), or
(ii) [ ] IAI Global Note (CUSIP ____________ ), or
(iii) [ ] Regulation S Global Note (CUSIP _________ ), or
(iv) [ ] Temporary Regulation S Global Note.
(b) a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ____________ ), or
(ii) [ ] IAI Global Note (CUSIP ____________ ), or
(iii) [ ] Unrestricted Global Note (CUSIP _____________ ), or
(iv) [ ] Regulation S Global Note (CUSIP ____________ ), or
(v) [ ] Temporary Regulation S Global Note
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Windsor Woodmont Black Hawk Resort Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
SunTrust Bank
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Re: 13% First Mortgage Notes due 2005
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of March 14, 2000
(the "Indenture"), between Windsor Woodmont Black Hawk Resort Corp., as issuer
(the "Company"), and SunTrust Bank, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in
a Restricted Global Note for Unrestricted Definitive Notes or Beneficial
Interests in an Unrestricted Global Note
--------------------------------------------------------------------------------
(a) [ ]Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the United States Securities Act of
1933, as amended (the "Securities Act"), (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest in an Unrestricted Global Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
(b) [ ]Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
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is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. [ ] Exchange of Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes for Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) Check if Exchange is from Restricted Definitive Note to beneficial
interest in a Restricted Global Note. In connection with the Exchange of the
Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE]
[ ] 144A Global Note, [ ] Regulation S Global Note, [ ] IAI Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
--------------------------------
[Insert Name of Transferor]
By:________________________________
Name:
Title:
Dated:
----------------------
C-3
EXHIBIT D
FORM OF CERTIFICATE OF
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Windsor Woodmont Black Hawk Resort Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
SunTrust Bank
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Re: 13% First Mortgage Notes Due 2005
Reference is hereby made to the Indenture, dated as of March 14, 2000
(the "Indenture"), between Windsor Woodmont Black Hawk Resort Corp., as issuer
(the "Company"), and SunTrust Bank, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
We confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such transfer is in
compliance with the Securities Act, (D) outside the United States in accordance
with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the
provisions of Rule 144(k) under the Securities Act (F) pursuant to an effective
registration statement under the Securities Act or an exemption from such
registration, and we further agree to provide to any person purchasing the
Definitive Note or beneficial interest in a Global Note from us in a transaction
meeting the requirements of clauses (A) through (E) of this paragraph a notice
advising such purchaser that resales thereof are restricted as stated herein.
D-1
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
------------------------------------
[Insert Name of Accredited Investor]
By:____________________________________
Name:
Title:
Dated:
-------------------------
D-2
EXHIBIT E
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT SUBSIDIARY GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
_____________,____, among _________________________ (the "Guaranteeing
Subsidiary"), a direct or indirect subsidiary of Windsor Woodmont Black Hawk
Resort Corp. (or its permitted successor), a Colorado corporation (the
"Company"), the other Persons (as defined in the Indenture referred to herein)
that have previously entered into a supplemental indenture pursuant to the terms
of the Indenture (each an "Existing Subsidiary Guarantor" and, together with the
Guaranteeing Subsidiary, each a "Subsidiary Guarantor") and SunTrust Bank, as
trustee under the Indenture (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of March 14, 2000, providing
for the issuance of an aggregate principal amount of $100,000,000 of 13% First
Mortgage Notes due 2005 (the "Initial Notes") plus up to an additional $35.0
million aggregate principal amount of Notes to be issued thereunder in
accordance with the Indenture (the "Additional Notes", and, together with the
Initial Notes, the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations (as defined in the Indenture) under
the Notes and the Indenture on the terms and conditions set forth herein; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Guaranteeing
Subsidiary and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Notes as follows:
1. Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. Amendments to the Indenture3. (a) Section 1.01 of the Indenture is
hereby amended to add the following definitions:
(a) The definition of "obligor" in Section 1.03 of the Indenture
is hereby amended and restated to read in its entirety as follows:
"obligor" on the Notes and the Subsidiary Guarantees means the
--------
3 This section should be included only the first time that this supplemental
indenture is executed.
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Company and the Subsidiary Guarantors, respectively, and any successor
obligor upon the Notes and the Subsidiary Guarantees, respectively."
(b) Section 4.03(b) of the Indenture is hereby amended to include
the words "and the Subsidiary Guarantors" after the first time the
words "the Company" appear in such section.
(c) Section 4.04(a) of the Indenture is hereby amended to include
the words "and each Subsidiary Guarantor (to the extent that such
Subsidiary Guarantor is so required under the TIA)" after first time
the words "the Company" appear in such section.
(d) Section 4.06 of the Indenture is hereby amended to include
the words "and each of the Subsidiary Guarantors" after each time the
words "the Company" appear in such section.
(e) Section 6.01 of the Indenture is hereby amended to add the
following provision:
"(m) except as permitted by this Indenture, any Subsidiary
Guarantee is held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be
in full force and effect or any Subsidiary Guarantor, or any
Person acting on behalf of any Subsidiary Guarantor, shall
deny or disaffirm its obligations under such Subsidiary
Guarantor's Subsidiary Guarantee."
(f) The first clause of Section 9.01 is hereby amended and
restated to read in its entirety as follows:
"Notwithstanding Section 9.02 of this Indenture, the
Company, the Subsidiary Guarantors and the Trustee may amend
or supplement this Indenture, the Subsidiary Guarantees or
the Notes without the consent of any Holder of a Note:"
(g) Section 9.01(c) is hereby amended and restated to read in its
entirety as follows:
"(c) to provide for the assumption of the Company's or a
Subsidiary Guarantor's obligations to the Holders of the
Notes by a successor to the Company pursuant to Article 5 or
Article 12 hereof;"
(h) The last paragraph of Section 9.01 is hereby amended to
include the words "and the Subsidiary Guarantors" after second time
the words "the Company" appear in such paragraph.
(i) Section 9.02 of the Indenture is hereby amended to (i)
include the phrase ", the Subsidiary Guarantees" after the first
parenthetical appearing in such section and after the second time that
the word "Indenture" appears in such section; (ii) add the following
clause as a new clause (h):
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"(h) release any Subsidiary Guarantor from any of its
obligations under its Subsidiary Guarantee or this
Indenture, except in accordance with the terms of this
Indenture; or"
and (iii) the existing clause (h) shall be relettered as clause (i).
(j) Section 11.02 of the Indenture is hereby amended to provide
that any notices to be given to a Subsidiary Guarantor pursuant to the
Indenture shall be given at the address of the Company and in the
manner that notices are given to the Company.
(k) Section 11.10 of the Indenture is hereby amended to add the
following"
"All agreements of each Subsidiary Guarantor in this
Indenture shall bind its successors, except as otherwise
provided in Section 12.05."
(l) Section 10.01 is hereby amended and restated to read in its
entirety as follows:
"Section 10.01. Security.
---------
The due and punctual payment of the principal of and
Interest and premium, if any, and Liquidated Damages, if
any, on the Notes when and as the same shall be due and
payable, whether on an Interest Payment Date, at maturity,
by acceleration, repurchase, redemption or otherwise, and
Interest on the overdue principal of and Interest and
Liquidated Damages (to the extent permitted by law), if any,
on the Notes and performance of all other obligations of the
Company and the Subsidiary Guarantors to the Holders of
Notes or the Trustee under this Indenture and the Notes and
the Subsidiary Guarantees, according to the terms hereunder
or thereunder, shall be ratably secured by a Lien on the
Collateral owned by the Company and each Subsidiary
Guarantee similarly shall be secured as provided in the
Collateral Documents. Each Holder of Notes, by its
acceptance thereof, consents and agrees to the terms of the
Collateral Documents (including, without limitation, the
provisions providing for foreclosure and release of
Collateral) as the same may be in effect or may be amended
from time to time in accordance with its terms and
authorizes and directs the Trustee to enter into the
Collateral Documents and to perform its obligations and
exercise its rights thereunder in accordance therewith. The
Company and the Subsidiary Guarantors shall deliver to the
Trustee copies of all documents executed pursuant to this
Indenture and the Collateral Documents, and shall do or
cause to be done all such acts and things as may be
necessary or proper, or as may be required by the provisions
of the Collateral Documents, to assure and confirm to the
Trustee the security interest in the Collateral contemplated
hereby, as from time to time constituted, so as to render
the same available for the security and benefit of this
Indenture and of the Notes and the Subsidiary Guarantees
secured hereby, according to the intent and purposes herein
expressed. The Company shall take, or shall cause its
Subsidiaries to take, upon request of the Trustee, any and
all actions reasonably required to create and maintain, as
E-3
security for the Obligations of the Company hereunder, a
valid and enforceable perfected first priority Lien in and
on all the Collateral, in favor of the Trustee for the
benefit of the Holders of Notes, superior to and prior to
the rights of all third Persons and subject to no other
Liens than Permitted Liens, including executing, as
applicable, a Pledge Agreement in the form attached hereto
as Exhibit F and a Collateral Assignment in the form
attached hereto as Exhibit G."
(n) Section 10.02(a) of the Indenture is hereby amended to add
the words "and the Subsidiary Guarantors" after the first time that
the words "the Company" appear in such section and to add the words
"and the Subsidiary Guarantees" after the first time the words "the
Notes" appear in such section.
(o) Section 10.02(b) of the Indenture is hereby amended to add
the words "and the Subsidiary Guarantors" after the first time that
the words "the Company" appear in such section.
(p) Section 10.09 of the Indenture is hereby amended to add the
words "or any Subsidiary Guarantor" after the first and third times
the words "the Company" appear in such section and the words "or such
Subsidiary Guarantor" after the second and fourth times the words "the
Company" appear in such section
(m) The Indenture is hereby amended to add the following
provisions:
"ARTICLE XII
SUBSIDIARY GUARANTEES"
"Section 12.01. Guarantee. Subject to this Article 12, each of the
Subsidiary Guarantors hereby, jointly and severally, unconditionally guarantees
to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, irrespective of the validity and
enforceability of this Indenture, the Notes or the obligations of the Company
hereunder or thereunder, that: (a) the principal of and Interest on the Notes
will be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and Interest
on the Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately. Each Subsidiary Guarantor agrees that this is a guarantee of
payment and not a guarantee of collection.
The Subsidiary Guarantors hereby agree that their obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
E-4
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a Subsidiary
Guarantor. Each Subsidiary Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenant that this
Subsidiary Guarantee shall not be discharged except by complete performance of
the obligations contained in the Notes and this Indenture. If any Holder or the
Trustee is required by any court or otherwise to return to the Company, the
Subsidiary Guarantors or any custodian, trustee, liquidator or other similar
official acting in relation to either the Company or the Subsidiary Guarantors,
any amount paid by either to the Trustee or such Holder, this Subsidiary
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Subsidiary Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Subsidiary Guarantor further agrees that, as between the Subsidiary
Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the obligations guaranteed hereby may be accelerated as
provided in Article 6 hereof for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (y) in the
event of any declaration of acceleration of such obligations as provided in
Article 6 hereof, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Subsidiary Guarantors for the purpose of
this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to
seek contribution from any non-paying Subsidiary Guarantor so long as the
exercise of such right does not impair the rights of the Holders under the
Guarantee.
Section 12.02. Limitation on Subsidiary Guarantor Liability. Each
Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or
conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Subsidiary Guarantors hereby
irrevocably agree that the obligations of such Subsidiary Guarantor will, after
giving effect to such maximum amount and all other contingent and fixed
liabilities of such Subsidiary Guarantor that are relevant under such laws, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Subsidiary Guarantor in respect of
the obligations of such other Subsidiary Guarantor under this Article 12, result
in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee
not constituting a fraudulent transfer or conveyance.
Section 12.03. Execution and Delivery of Subsidiary Guarantee. To
evidence its Subsidiary Guarantee set forth in Section 12.01, each Subsidiary
Guarantor hereby agrees that a notation of such Subsidiary Guarantee shall be
endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated
and delivered by the Trustee substantially in the following form:
E-5
"For value received, each Subsidiary Guarantor (which term includes
any successor Person under the Indenture) has, jointly and severally,
unconditionally guaranteed, to the extent set forth in the Indenture
and subject to the provisions in the Indenture dated as of March 14,
2000 (the "Indenture") among Windsor Woodmont Black Hawk Resort Corp.,
a Colorado corporation, the Subsidiary Guarantors listed on Schedule I
thereto and SunTrust Bank, as trustee (the "Trustee"), (a) the due and
punctual payment of the principal of, premium, if any, and Interest on
the Notes (as defined in the Indenture), whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of
interest on overdue principal and premium, and, to the extent
permitted by law, Interest, and the due and punctual performance of
all other obligations of the Company to the Holders or the Trustee all
in accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Notes or any of such
other obligations, that the same will be promptly paid in full when
due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise. The
obligations of the Subsidiary Guarantors to the Holders of Notes and
to the Trustee pursuant to the Subsidiary Guarantee and the Indenture
are expressly set forth in Article 12 of the Indenture and reference
is hereby made to the Indenture for the precise terms of the
Subsidiary Guarantee. Each Holder of a Note, by accepting the same,
(a) agrees to and shall be bound by such provisions and (b) appoints
the Trustee attorney-in-fact of such Holder for such purpose.
[NAME OF SUBSIDIARY GUARANTOR(S)]
By:
--------------------------------------------
Name:
--------------------------------------------
Title: "
--------------------------------------------
Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee
set forth in Section 12.01 shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set
forth in this Indenture on behalf of the Subsidiary Guarantors.
Section 12.04. Subsidiary Guarantors May Consolidate, etc., on Certain
Terms. Except as otherwise provided in Section 12.05, no Subsidiary Guarantor
may consolidate with or merge with or into (whether or not such Subsidiary
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Guarantor is the surviving Person) another corporate Person or entity whether or
not affiliated with such Subsidiary Guarantor unless:
(a) subject to Section 12.05 hereof, the Person formed by or surviving
any such consolidation or merger (if other than a Subsidiary Guarantor or the
Company) unconditionally assumes all the obligations of such Subsidiary
Guarantor, pursuant to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under the Notes, the Indenture and the Subsidiary
Guarantee on the terms set forth herein or therein; and
(b) immediately after giving effect to such transaction, no Default or
Event of Default exists.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Subsidiary Guarantor, such successor Person shall succeed to
and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Subsidiary Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of this Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 of the Indenture, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with
or into the Company or another Subsidiary Guarantor, or shall prevent any sale
or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety to the Company or another Subsidiary Guarantor.
Section 12.05. Releases Following Sale of Assets. In the event of a
sale or other disposition of all of the assets of any Subsidiary Guarantor, by
way of merger, consolidation or otherwise, or a sale or other disposition of all
to the capital stock of any Subsidiary Guarantor, in each case to a Person that
is not (either before or after giving effect to such transactions) a Restricted
Subsidiary of the Company, then such Subsidiary Guarantor (in the event of a
sale or other disposition, by way of merger, consolidation or otherwise, of all
of the capital stock of such Subsidiary Guarantor) or the corporation acquiring
the property (in the event of a sale or other disposition of all or
substantially all of the assets of such Subsidiary Guarantor) will be released
and relieved of any obligations under its Subsidiary Guarantee; provided that
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Indenture, including without limitation
Section 4.10 hereof. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Subsidiary Guarantor from its obligations under its Subsidiary Guarantee.
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Any Subsidiary Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal of and
Interest on the Notes and for the other obligations of any Subsidiary Guarantor
under this Indenture as provided in this Article 12."
2. Agreement to Guarantee. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all other Subsidiary Guarantors, to jointly and
severally and unconditionally Guarantee to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that:
(i) the principal of and Interest on the Notes will be promptly paid
in full when due, whether at maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of and Interest on
the Notes, if any, if lawful, and all other obligations of the Company
to the Holders or the Trustee hereunder or thereunder will be promptly
paid in full or performed, all in accordance with the terms hereof and
thereof; and
(ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Subsidiary
Guarantors shall be jointly and severally obligated to pay the same
immediately.
(b) The obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Notes or the Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Notes with respect to any provisions hereof or thereof, the recovery of
any judgment against the Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Subsidiary Guarantor.
(c) The following is hereby waived: diligence presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest, notice and all demands whatsoever.
(d) This Subsidiary Guarantee shall not be discharged except by
complete performance of the obligations contained in the Notes and the
Indenture, and the Guaranteeing Subsidiary accepts all obligations of a
Subsidiary Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Subsidiary Guarantors, or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Subsidiary Guarantors, any amount paid by either to the Trustee or such
Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall
be reinstated in full force and effect.
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(f) The Guaranteeing Subsidiary shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby.
(g) As between the Subsidiary Guarantors, on the one hand, and the
Holders and the Trustee, on the other hand, (x) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article 6 of the Indenture
for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 of the Indenture, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Subsidiary Guarantors for the purpose of this Subsidiary
Guarantee.
(h) The Subsidiary Guarantors shall have the right to seek
contribution from any non- paying Subsidiary Guarantor so long as the exercise
of such right does not impair the rights of the Holders under the Guarantee.
(i) Pursuant to Section 12.02 of the Indenture, as amended to date,
after giving effect to any maximum amount and any other contingent and fixed
liabilities that are relevant under any applicable Bankruptcy or fraudulent
conveyance laws, and after giving effect to any collections from, rights to
receive contribution from or payments made by or on behalf of any other
Subsidiary Guarantor in respect of the obligations of such other Subsidiary
Guarantor under Article 10 of the Indenture, this new Subsidiary Guarantee shall
be limited to the maximum amount permissible such that the obligations of such
Subsidiary Guarantor under this Subsidiary Guarantee will not constitute a
fraudulent transfer or conveyance.
3. Execution and Delivery. Each Guaranteeing Subsidiary agrees that
the Subsidiary Guarantees shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Subsidiary Guarantee.
4. Guaranteeing Subsidiary May Consolidate, etc. on Certain Terms.
(a) The Guaranteeing Subsidiary may not consolidate with or merge with
or into (whether or not such Subsidiary Guarantor is the surviving Person)
another corporation, Person or entity whether or not affiliated with such
Subsidiary Guarantor unless:
(i) subject to Sections 12.04 and 12.05 of the Indenture, as
amended to date, the Person formed by or surviving any such
consolidation or merger (if other than a Subsidiary Guarantor or the
Company) unconditionally assumes all the obligations of such
Subsidiary Guarantor, pursuant to a supplemental indenture in form and
substance reasonably satisfactory to the Trustee, under the Notes, the
Indenture and the Subsidiary Guarantee on the terms set forth herein
or therein; and
(ii) immediately after giving effect to such transaction, no
Default or Event of Default exists.
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(b) In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor Person, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of the Indenture to be
performed by the Subsidiary Guarantor, such successor corporation shall succeed
to and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Subsidiary Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank and benefit
under the Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of the Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section 12.05 of the
Indenture, as amended to date, and notwithstanding clauses (a) and (b) above,
nothing contained in the Indenture or in any of the Notes shall prevent any
consolidation or merger of a Subsidiary Guarantor with or into the Company or
another Subsidiary Guarantor, or shall prevent any sale or conveyance of the
property of a Subsidiary Guarantor as an entirety or substantially as an
entirety to the Company or another Subsidiary Guarantor.
5. Releases.
--------
(a) In the event of a sale or other disposition of all of the assets
of any Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a
sale or other disposition of all to the capital stock of any Subsidiary
Guarantor, in each case to a Person that is not (either before or after giving
effect to such transaction) a Restricted Subsidiary of the Company, then such
Subsidiary Guarantor (in the event of a sale or other disposition, by way of
merger, consolidation or otherwise, of all of the capital stock of such
Subsidiary Guarantor) or the corporation acquiring the property (in the event of
a sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor) will be released and relieved of any obligations under its
Subsidiary Guarantee; provided that the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of the
Indenture, including without limitation Section 4.10 of the Indenture. Upon
delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made by
the Company in accordance with the provisions of the Indenture, including
without limitation Section 4.10 of the Indenture, the Trustee shall execute any
documents reasonably required in order to evidence the release of any Subsidiary
Guarantor from its obligations under its Subsidiary Guarantee.
(b) Any Subsidiary Guarantor not released from its obligations under
its Subsidiary Guarantee shall remain liable for the full amount of principal of
and interest on the Notes and for the other obligations of any Subsidiary
Guarantor under the Indenture as provided in Article 12 of the Indenture, as
amended to date.
6. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the Company
or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantees, the
E-10
Collateral Documents, the Indenture or this Supplemental Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of the Notes by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the SEC that such a
waiver is against public policy.
7. New York Law To Govern. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10. The Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: ,
--------------------------- ------
[GUARANTEEING SUBSIDIARY]
By:
-------------------------------------
Name:
Title:
WINDSOR WOODMONT BLACK HAWK
RESORT CORP.
By:
-------------------------------------
Name:
Title:
[EXISTING Subsidiary Guarantors]
By:
-------------------------------------
Name:
Title:
SUNTRUST BANK,
as Trustee
By:
-----------------------------------
Authorized Signatory
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Schedule I
SCHEDULE OF SUBSIDIARY GUARANTORS
---------------------------------
The following schedule lists each Subsidiary Guarantor under the
Indenture as of the Issue Date:
E-13
EXHIBIT F
FORM OF SUBSIDIARY
INTERCOMPANY NOTE
-----------------
$[________________________] [Black Hawk, Colorado]
[____________][____], 200[__]
FOR VALUE RECEIVED, [Restricted Subsidiary], a [__________]
corporation (the "Payor"), hereby promises to pay on demand to the order of
Windsor Woodmont Black Hawk Resort Corp., a Colorado corporation (the "Payee"),
the unpaid principal amount of all loans and advances made from time to time by
the Payee to the Payor, in lawful money of the United States of America in
immediately available funds, at such location in the United States of America as
the Payee shall from time to time designate.
The Payor promises also to pay interest on the unpaid principal amount
hereof in like money at said office from the date hereof until all such
principal amounts have been repaid in full, which interest shall be payable at
such rate per annum as shall be agreed upon from time to time by the Payor and
Payee.
Upon the commencement of any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or
similar proceeding of any jurisdiction relating to the Payor, the unpaid
principal amount hereof shall become immediately due and payable without
presentment, demand, protest or notice of any kind in connection with this
Subsidiary Intercompany Note.
This Subsidiary Intercompany Note is executed to evidence intercompany
Indebtedness referred to in the Indenture, dated as of March [___], 2000 (as
amended, supplemented, restated or otherwise modified from time to time, the
"Indenture", by and between Payee and [____________________], as trustee
(together with its successors in such capacity, the "Trustee"). Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
such terms in the Indenture. The Payor hereby acknowledges and agrees that the
Trustee, as in effect from time to time, may exercise all rights provided
therein with respect to this Subsidiary Intercompany Note.
The Payee is hereby authorized (but not required) to record all loans
and advances made by it to the Payor (all of which shall be evidenced by this
Subsidiary Intercompany Note), and all repayments thereof, in its books and
records, such books and records constituting prima facie evidence of the
accuracy of the information contained therein. The failure of the Payee to
record any repayments made on account of the principal balance thereof shall not
limit or otherwise affect the obligations of the Payor under the Subsidiary
Intercompany Note to pay the principal and interest due and payable hereunder.
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All payments under this Subsidiary Intercompany Note shall be made
without offset, counterclaim or deduction of any kind. The Payee hereby waives
presentment for payment and demand.
The Payee hereby irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim arising out of or relating to this Subsidiary
Intercompany Note.
THIS SUBSIDIARY INTERCOMPANY NOTE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
[RESTRICTED SUBSIDIARY]
By: _______________________________
Name: _______________________________
Title: _______________________________
F-2
Exhibit G
PLEDGE AGREEMENT
----------------
THIS PLEDGE AGREEMENT, dated as of [__________], 200[__] (herein, as
amended or otherwise modified from time to time, called this "Pledge
Agreement"), is between [[RESTRICTED SUBSIDIARY], [_____________]/Windsor
Woodmont Black Hawk Resort Corp., a Colorado corporation] (herein called the
"Pledgor")], and SUNTRUST BANK, a Georgia banking corporation, as trustee
(herein, together with its successors in such capacity, called the "Trustee")
for the benefit of itself and the Holders (as hereinafter defined).
W I T N E S S E T H
-------------------
WHEREAS, [the Pledgor /Windsor Woodmont Black Hawk Resort Corp., a
Colorado corporation (the "Company")] and the Trustee have previously entered
into that certain Indenture dated as of March 14, 2000 (as the same may be
amended, restated, supplemented or otherwise modified from time to time, the
"Indenture") pursuant to which [Pledgor/Company] is (a) issuing its 13% Series A
First Mortgage Notes due 2005 (such notes, together with any notes issued in
replacement thereof or in exchange therefor, the "Series A Notes"), and (b) will
issue its 13% Series B First Mortgage Notes due 2005 (such notes, together with
any notes issued in replacement thereof or in exchange therefor, the "Series B
Notes" and, together with the Series A Notes, the "Initial Notes"), in the
original aggregate principal amount of $100,000,000, and pursuant to which the
Issuer may issue up to an additional $35,000,000 aggregate principal amount of
notes in the same series as the Initial Notes (such notes, together with any
notes issued in replacement thereof or in exchange therefor, the "Additional
Notes" and, together with the Initial Notes, the "Notes");
[WHEREAS, in compliance with Section 4.20 of the Indenture, Xxxxxxx
has executed that certain Supplemental Indenture in favor of the Trustee] (the
"Supplemental Indenture");][insert only if Pledgor is a Restricted Subsidiary]
[WHEREAS, the Pledgor will derive substantial direct and indirect
benefit from the transactions contemplated in the Indenture;][insert only if
Pledgor is a Restricted Subsidiary]
WHEREAS, it is a requirement of Section 4.20 of the Indenture that
Pledgor execute and deliver this Pledge Agreement to the Trustee for itself and
the ratable benefit of the holders from time to time of the Notes (the
"Holders") to secure the payment and performance of the Obligations (as
hereinafter defined);
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of with is hereby acknowledged, Xxxxxxx agrees, for the benefit of
the Trustee, and for the ratable benefit of the Holders as follows:
F-3
Section 12. Definitions. Capitalized terms used but not otherwise
defined herein shall have the meanings given in the
Indenture. In addition the following terms shall have the
following meanings when used:
"Liquor Laws" means the liquor laws of any jurisdiction or
jurisdictions to which the Issuer or any of its Subsidiaries is, or may at any
time after the date of the Indenture, be subject.
"Liquor License" means any license, permit, franchise or other
authorization from any Liquor Licensing Authority necessary or required on the
date of the Indenture or at any time thereafter to own, lease, operate or
otherwise conduct the lodging, retail, restaurant or other entertainment
facilities of the Issuer, including all licenses granted under the Liquor Laws.
"Liquor Licensing Authority" means any agency, authority, board,
bureau, commission, department, office or instrumentality of any nature
whatsoever of the United States federal or a foreign government, any state,
province or any city or other political subdivision or otherwise, and whether
now or hereafter in existence, or any officer or official thereof, including the
Colorado Liquor Enforcement Division and the city of Black Hawk Liquor Licensing
Authority and any other applicable liquor licensing regulatory authority with
authority to regulate any liquor licensed operation (or proposed liquor licensed
operation) owned by the Issuer or any of its Subsidiaries and managed or
operated by Hyatt Gaming or any of its Subsidiaries.
"Obligations" means all obligations of the [Pledgor/Company [insert
only if Pledgor is a Restricted Subsidiary]] to the Holders and the Trustee
howsoever created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, which arise out
of or in connection with the Indenture, the Notes, this Pledge Agreement or any
other Transaction Document
"Transaction Documents" means the Indenture, the Notes, this Pledge
Agreement, the other Collateral Documents[, any Supplemental Indenture][insert
only if Pledgor is a Restricted Subsidiary] and all other documents,
instruments, financing statements and other agreements executed in connection
herewith and therewith from time to time, as each of the same may be amended,
restated, supplemented or otherwise modified from time to time.
"Uniform Commercial Code" means the Uniform Commercial Code as in
effect in the State of New York on the date of this Pledge Agreement; provided,
however, that if by reason of mandatory provisions of law, the perfection or
effect of perfection or non-perfection of the security interest granted
hereunder in any Pledged Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than New York, Uniform Commercial Code
shall mean the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection.
"Unmatured Surviving Obligation" means, as of any date, an Obligation
which is contingent and unliquidated and not due and owing on such date and
which, pursuant to provisions of any Transaction Document, survives termination
of such Transaction Document and the indefeasible payment in full of the Notes.
F-4
Section 13. Pledge and Grant of Security Interest. As collateral
security for the due and punctual payment and performance in
full when due (whether at stated maturity, upon redemption
or required repurchase, by acceleration or otherwise) of the
Notes and all other Obligations, the Pledgor hereby
hypothecates, pledges, sets over, delivers and grants to the
Trustee for itself and on behalf of the Holders, a
continuing first priority security interest in the following
("Pledged Collateral"):
(a) the Pledged Stock and the certificates representing or evidencing all
such shares;
(b) all payments of principal or interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed in respect of, in exchange for or upon the conversion of
the Pledged Stock;
(c) subject to Section 6 below, all rights and privileges of the Pledgor
with respect to the securities and other property referred to in
clauses (i) and (ii) above;
(d) all additional shares of stock of the Issuer from time to time
acquired by the Pledgor in any manner and the certificates
representing such additional shares and interests and all dividends,
cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for
such shares and interests; and
(e) all proceeds and products of any of the foregoing.
The Pledgor shall deliver to the Trustee, (A) any stock certificates or other
securities or instruments now or hereafter included in the Pledged Collateral
(the "Pledged Securities") (duly indorsed to the Trustee in blank or accompanied
by stock powers duly executed in blank or) other instruments of transfer
satisfactory to the Trustee together with such other instruments and documents
as the Trustee may reasonably request; and, (B) all other property comprising
part of the Pledged Collateral accompanied by proper instruments of assignment
duly executed by the Pledgor and such other instruments or documents as the
Trustee may reasonably request. Each delivery of such Pledged Collateral shall
be accompanied by a schedule describing the securities theretofore and then
being pledged hereunder, which schedule shall be attached hereto as Schedule I
and made a part hereof. Each schedule so delivered shall supersede any prior
schedules so delivered.
Section 14. Delivery of the Collateral. The Pledgor agrees to deliver or
cause to be delivered promptly to the Trustee pursuant
hereto any and all certificates or other instruments or
documents representing the Pledged Collateral, which shall
be in suitable form for transfer by delivery, or shall be
accompanied by instruments of transfer or assignment duly
executed in blank, all in form and substance satisfactory to
the Trustee.
Section 15. Representations and Warranties. The Pledgor hereby
represents, warrants and covenants to and with the Trustee
that:
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(a) the Pledged Stock includes all of the outstanding capital stock of the
Issuer owned by the Pledgor; the Pledged Stock has been duly
authorized and validly issued and is fully paid and non-assessable;
(b) except for the security interest granted hereunder, the Pledgor
(i) is and will at all times continue to be the direct owner,
beneficially and of record, of the Pledged Stock;
(ii) holds the same free and clear of all liens, security interests,
options or other charges or encumbrances (other than the Lien of
Hyatt Gaming in the Pledged Collateral which shall be subordinate
to the Lien granted herein to the Trustee);
(iii) will make no assignment, pledge, hypothecation or transfer of,
or create any security interest in, the Pledged Collateral (other
than the Lien of Hyatt Gaming in the Pledged Collateral which
shall be subordinate to the Lien granted herein to the Trustee);
(iv) will cause all securities included within the Pledged Collateral
to be certificated securities; and
(v) will cause any and all certificates, instruments or other
documents representing or evidencing Pledged Collateral to be
forthwith deposited with the Trustee and pledged or assigned
thereunder;
(c) by virtue of the execution and delivery by Pledgor of this Pledge
Agreement, when the Pledged Securities delivered to the Trustee in
accordance with this Pledge Agreement, and upon the filing of Uniform
Commercial Code financing statements in the appropriate filing offices
with respect to dividends payable in respect of the Pledged Stock, the
Trustee will obtain a valid, legal and perfected first priority lien
upon and security interest in the Pledged Collateral as security for
the repayment of the Obligations free and clear of all other liens
(other than the Lien of Hyatt Gaming in the Pledged Collateral which
shall be subordinate to the Lien granted herein to the Trustee);
(d) the pledge effected hereby is effective to vest in the Trustee, for
the benefit of the Trustee and the Holders, the rights of the Trustee
in the Pledged Collateral as set forth herein;
(e) concurrently with the issuance by the Issuer of any additional stock
or equity securities to the Pledgor, the Pledgor will pledge and
deliver all such stock or securities to the Trustee hereunder;
F-6
(f) this Pledge Agreement is the legal, valid and binding obligation of
the Pledgor according to its terms, except as such enforcement may be
limited by the effect of applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights of creditors generally; and
(g) there are no conditions precedent to the effectiveness of this Pledge
Agreement which have not been satisfied or waived.
Section 16. Registration in Nominee Name; Denominations. Subject to
compliance with the Gaming Laws and the Liquor Laws:
(a) The Trustee, on behalf of the Holders, shall have the right (in its
sole and absolute discretion) to hold the Pledged Securities in its
own name, the name of its nominee or the name of the Pledgor, endorsed
or assigned in blank or in favor of the Trustee;
(b) the Pledgor will promptly give to the Trustee copies of any notices or
other communications received by it with respect to Pledged Securities
registered in the name of the Pledgor; and
(c) the Trustee shall at all times have the right to exchange the
certificates representing Pledged Securities for certificates of
smaller or larger denominations for any purposes consistent with this
Pledge Agreement.
Section 17. Voting Rights; Dividends and Interest; etc. Subject to
compliance with Gaming Laws and Liquor Laws: unless and
until an Event of Default shall have occurred and be
continuing:
(i) The Pledgor shall be entitled to exercise or refrain from
exercising any and all voting rights and other consensual
rights accruing to it as the owner of the Pledged Collateral
or any part thereof for any purpose consistent with the
terms of this Pledge Agreement and the Indenture; provided,
however, that the exercise or refrain from exercising of
rights could not reasonably be expected, in the best
judgment of the Trustee, to have a material adverse effect
on the value of the Pledged Collateral or to adversely
affect the rights and remedies of the Trustee under this
Pledge Agreement or the Indenture or the ability of the
Trustee to exercise the same; provided further that the
Pledgor shall give the Trustee at least five (5) Business
Days written notice of the manner in which it intends to
exercise or refrain from exercising on such right;
(ii) The Pledgor shall be entitled to receive and retain any and
all cash dividends and interest paid on the Pledged
Collateral to the extent and only to the extent that such
dividends and interest payments are permitted by, and
otherwise paid in accordance with, the terms and conditions
of the Indenture and applicable laws; provided, that any and
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all other dividends and distributions and interest made on
or in respect of the Pledged Collateral, whether paid or
payable in cash, securities or other property and, whether
resulting from a subdivision, combination or
reclassification, or received in exchange for the principal
of or in redemption of, or in exchange for the Pledged
Collateral or any part thereof, or as a result of any
merger, consolidation, acquisition or other exchange of
assets to which the issuer thereof may be a party or
otherwise, shall be forthwith delivered to the Trustee as
part of the Pledged Collateral and, if received by the
Pledgor, shall be segregated from and, shall not be
commingled by the Pledgor with, any other funds or property
held by the Pledgor but shall be held separate and apart
therefrom in trust for the benefit of the Trustee and shall
be delivered to the Trustee in the same form as so received
(with any necessary endorsement or assignment).
(a) Upon the occurrence and during the continuance of an Event of
Default, all rights of the Pledgor to dividends and interest
which the Pledgor is authorized to receive pursuant to paragraph
(a)(ii) of this Section 6 shall cease, and all such rights shall
thereupon become vested in the Trustee, who shall have the sole
and exclusive right and authority to receive and retain as
Pledged Collateral such dividends and interest payments; and
(i) all dividends, distributions and interest payments which are
received by the Pledgor contrary to the provisions of this
Section 6(b) shall be received in trust for the benefit of
the Trustee and the Holders, shall be segregated from other
property or funds of the Pledgor and shall be immediately
delivered to the Trustee in the same form as so received
(with any necessary endorsement). Any and all money and
other property paid over to or received by the Trustee
pursuant to the provisions of this subdivision (ii)
paragraph 6(b) shall be deposited by the Trustee in an
account to be established by the Trustee for the benefit of
the Trustee and the Holders upon receipt of such money or
other property and shall be applied in accordance with the
provisions of Section 8 hereof.
(b) Upon the occurrence and during the continuance of an Event of
Default, all rights of the Pledgor to exercise or refrain from
exercising the voting rights which it is entitled to exercise or
refrain from exercising pursuant to paragraph (a)(i) of this
Section 6 shall, upon notice to the Trustee, cease, and all such
rights shall thereupon become vested in the Trustee, which shall
have the sole and exclusive right (but not the obligation) and
authority to exercise such voting rights. This Section 6(c) shall
be deemed a proxy in favor of the Trustee (on behalf of the
Holders) to, upon the occurrence and during the continuance of an
Event of Default, subject to compliance with Gaming Laws and
Liquor Laws, vote the Pledged Collateral in such manner as the
Trustee may deem advisable in its sole discretion, which proxy
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shall survive until such date as all Obligations have been fully
and indefeasibly paid in cash and which proxy shall be
irrevocable and coupled with an interest in the Pledged
Collateral. The Pledgor shall execute and deliver to the Trustee
all such proxies, powers of attorney, and other instruments as
the Trustee shall request for the purpose of enabling the Trustee
to exercise or refrain from exercising the voting rights which it
is entitled to exercise or refrain from exercising pursuant to
this Section 6(c) during the continuance of such Event of
Default.
Section 18. Remedies upon an Event of Default. Upon the occurrence and
during the continuance of an Event of Default, subject to
compliance with the Gaming Laws and Liquor Laws, whether or
not all of the Obligations shall have become due and
payable, in addition to its rights under the Indenture and
any other Transaction Documents: the Trustee:
(i) shall have all of the rights and remedies with respect to
the Pledged Collateral of a secured party under the Uniform
Commercial Code and such additional rights and remedies to
which a secured party is entitled under the laws in effect
in any jurisdiction where any rights and remedies hereunder
may be asserted, including, without limitation, the right,
to the maximum extent permitted by law, to exercise all
voting, consensual and other powers of ownership pertaining
to the Pledged Collateral as if the Trustee were the sole
and absolute owner thereof (and the Pledgor agrees to take
all such action as may be appropriate to give effect to such
right);
(ii) may, in its discretion, in its name or in the name of the
Pledgor or otherwise, demand, sue for, collect or receive
any money or property at any time payable or receivable on
account of or in exchange for any of the Pledged Collateral,
but shall be under no obligation to do so; and
(iii) may, upon ten (10) days' prior written notice to the
Pledgor, sell, lease, assign or otherwise dispose of all or
part of such Pledged Collateral, at such place or places as
the Trustee deems best, and for cash or for credit or for
future delivery (without thereby assuming any credit risk),
at public or private sale, without demand of performance or
notice of intention to effect any such disposition or of the
time or place thereof (except such notice as is required
above or by applicable statute and cannot be waived), and
the Trustee, any Holder or anyone else may be the purchaser,
lessee, assignee or recipient of any or all of the Pledged
Collateral so disposed of at any public sale (or, to the
extent permitted by law, at any private sale) and thereafter
hold the same absolutely, free from any claim or right of
whatsoever kind, including any right or equity of redemption
(statutory or otherwise) of the Pledgor, any such demand,
notice and right or equity being hereby expressly waived and
released. The Pledgor agrees that, to the extent notice of
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sale shall be required by law, at least ten days' notice to
the Pledgor of the time and place of any public sale or the
time after which such private sale is to be made shall
constitute reasonable notification; however, the Trustee
shall not be obligated to make any sale of the Pledged
Collateral regardless of notice of sale having been given.
The Trustee may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place
fixed for the sale, and such sale may be made at any time or
place to which the sale may be so adjourned.
The Pledgor recognizes that by reason of certain prohibitions
contained in the Securities Act of 1933 (as amended from time to time, the
"Securities Act"), and applicable state securities laws, the Trustee may be
compelled, with respect to any sale of all or any part of the Pledged
Collateral, to limit purchasers to those who will agree, among other things, to
acquire the Pledged Collateral for their own account, for investment and not
with a view to the distribution or resale thereof. The Pledgor acknowledges that
any such private sales may be at prices and on terms less favorable to the
Trustee than those obtainable through a public sale without such restrictions,
and, notwithstanding such circumstances, agrees that any such private sale shall
be deemed to have been made in a commercially reasonable manner and that the
Trustee shall have no obligation to engage in public sales and no obligation to
delay the sale of any Pledged Collateral for the period of time necessary to
permit the Pledgor or the Issuer to register any such Pledged Collateral for
public sale.
18.01 The Pledgor agrees that, upon the occurrence and during the
continuance of an Event of Default, if for any reason the Trustee
desires and exercises its right to sell any of the Pledged Collateral
pursuant to this Section 7, the Pledgor shall, at any time and from
time to time, upon the written request of the Trustee:
(a) take (or use its best efforts to cause to be taken) such action
to prepare, distribute and/or file such documents, as are
required or advisable in the opinion of counsel for the Trustee
to register the Pledged Securities under the Securities Act to
permit the public sale of such Pledged Collateral, including, but
not limited to, a public offering and sale of the Pledged
Securities pursuant to any applicable federal and state
securities laws and regulations, and to cause the registration
statement to remain effective for such period as prospectuses are
required by law to remain effective;
(b) indemnify, defend and hold harmless the Trustee and any financial
advisor or underwriter from and against any and all loss,
liability, expenses, costs, fees and disbursements of counsel
(including, without limitation, the cost to the Trustee of legal
counsel), and any and all claims (including the costs of
investigation) which they may incur insofar as such loss,
liability, expense or claim arises out of or is based upon any
alleged untrue statement of a material fact contained in any
prospectus (or any amendment or supplement thereto) or in any
notification or offering circular, or arises out of or is based
upon any alleged omission to state a material fact required to be
stated therein or necessary to make the statements in any respect
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thereof not misleading, except insofar as the same may have been
caused by any untrue statement or omission based upon information
furnished in writing to the Pledgor or the issuer of such Pledged
Securities by the Trustee or the underwriter expressly for use
therein; and
(c) the Pledgor further agrees to use its best efforts to qualify,
file or register, or cause the issuer of any Pledged Securities
to qualify, file or register, any of the Pledged Securities under
applicable state securities laws and regulations as the Trustee
may specify and to keep effective, or cause to be kept effective,
all such qualifications, filings or registrations.
The Pledgor acknowledges that there is no adequate remedy at law for
failure by it to comply with the foregoing provisions and that such failure
would not be adequately compensable in damages, and therefore agrees that its
agreements with respect to the foregoing may be specifically enforced.
Section 19. Payments; Applications. The proceeds of any sale of or other
realization upon, all or any part of the Pledged Collateral
shall be applied by the Trustee as follows:
First: to payment of all of the reasonable costs and expenses of
the Trustee, including (i) the expenses of such sale, (ii) the
out-of-pocket costs and expenses of the Trustee and the fees and
out-of-pocket costs and expenses of counsel employed by the Trustee,
(iii) the payment of all advances made by the Trustee for the account
of Pledgor hereunder (including reasonable attorneys' fees), and (iv)
the payment of all costs and expenses incurred by the Trustee in
connection with the administration and enforcement of this Pledge
Agreement, to the extent that such advances, costs and expenses shall
not have been reimbursed to the Trustee;
Second: to the payment in full of the Obligations in a manner
consistent with Section 6.10 of the Indenture as the Trustee in its
discretion shall decide, based upon additional funds that may be
needed to administer an Event of Default;
Third: the balance, if any, of such proceeds shall be paid to the
Pledgor, its successors and assigns, or to whomever may be lawfully
entitled to receive the same.
Section 20. Reimbursement of Trustee. The Pledgor hereby agrees to
reimburse the Trustee, on demand, for all reasonable
expenses incurred by the Trustee in connection with the
administration and enforcement of this Pledge Agreement and
agrees to indemnify the Trustee and hold the Trustee
harmless from and against any and all liability incurred by
the Trustee hereunder or in connection herewith, unless such
liability shall have been determined by a final,
non-appealable order of a court of competent jurisdiction to
have resulted from willful misconduct or gross negligence on
the part of the Trustee.
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Section 21. Trustee Appointed Attorney-in-Fact. Except as otherwise
provided herein, the Pledgor hereby appoints the Trustee the
attorney-in-fact of the Pledgor for the purposes of carrying
out the provisions of this Pledge Agreement or taking any
action or executing any instrument which the Trustee may
deem necessary or advisable to accomplish the purposes
hereof, which appointment is irrevocable and coupled with an
interest. Without limiting the generality of the foregoing,
the Trustee shall have the right, upon the occurrence and
during the continuance of an Event of Default subject to
compliance with Gaming Laws and Liquor Laws, with full power
of substitution either in the Trustee's name or in the name
of the Pledgor, to ask for, demand, sue for, collect,
receive and give acquittance for any and all monies due or
to become due under or by virtue of any Pledged Collateral,
to endorse checks, drafts, orders and other instruments for
the payment of money payable to the Pledgor constituting
Pledged Collateral or any part thereof or on account thereof
and to give full discharge for the same, to settle,
compromise, prosecute or defend any action, claim or
proceeding with respect thereto, and to sell, assign,
endorse, pledge, transfer and make any agreement respecting,
or otherwise deal with, the same; provided, however, that
nothing herein contained shall be construed as requiring or
obligating the Trustee to make any commitment or to make any
inquiry as to the nature or sufficiency of any payment
received by the Trustee, or to present or file any claim or
notice, or to take any action with respect to the Pledged
Collateral or any part thereof or the monies due or to
become due in respect thereof or any property covered
thereby, and no action taken by the Trustee or omitted to be
taken with respect to the Pledged Collateral or any part
thereof shall give rise to any defense, counterclaim or
offset in favor of the Pledgor or to any claim or action
against the Trustee.
Section 22. Trustee May Perform. If the Pledgor fails to perform any
agreement contained herein, the Trustee may itself perform,
or cause performance of, such agreement and the expenses of
the Trustee incurred in connection therewith shall be
payable by the Pledgor in accordance with Section 12.
Section 23. Expenses. The Pledgor will upon demand pay to the Trustee
the amount of any and all reasonable expenses, including the
fees and expenses of its counsel and of any experts and
Trustees, which the Trustee may incur in connection with (i)
the administration of this Pledge Agreement, (ii) the
custody or preservation of, or the sale of, collection from
or other realization upon, any of the Pledged Collateral,
(iii) the exercise or enforcement of any of the rights of
the Trustee hereunder or (iv) the failure by the Pledgor to
perform or observe any of the provisions hereof.
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Section 24. No Waiver. No delay on the part of the Trustee in the
exercise of any right or remedy shall operate as a waiver
thereof, and no single or partial exercise by the Trustee of
any right or remedy shall preclude other or further exercise
thereof or the exercise of any other right or remedy.
Section 25. Notices. Any notice or communication by the Pledgor or the
Trustee to the others is duly given if in writing and
delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day
delivery, to the others' address:
If to the Pledgor: [________________________]
[________________________]
[________________________]
Telecopier No.: (___) ___-____
Attention: [_______________]
With a copy to: Xxxx, Xxxxxxxx, Xxxxxxxx & Xxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
If to the Trustee: SunTrust Bank
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
A copy of any notice provided pursuant to this Pledge Agreement shall
also be provided to Hyatt Gaming at its address as set forth in the Management
Agreement.
The Pledgor or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications. All
notices and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days after being
deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
Section 26. Entire Agreement; Amendments. This Pledge Agreement sets
forth the entire understanding and agreement of the Pledgor
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and the Trustee, and shall supersede any other agreements
and understandings (written or oral) between the Pledgor and
the Trustee on or prior to the date of this Pledge Agreement
with respect tot he transaction contemplated in this Pledge
Agreement. No amendment or modification to any terms of this
Pledge Agreement, or cancellation of this Pledge Agreement,
shall be valid unless in writing and executed and delivered
by both the Pledgor and the Trustee.
Section 27. Further Assurances. The Pledgor agrees that at any time from
time to time, at the expense of the Pledgor, the Pledgor
will do such further acts and things, and execute and
deliver such additional conveyances, assignments, agreements
and instruments, as the Trustee may at any time request in
connection with the administration and enforcement of this
Pledge Agreement, with respect to the Pledged Collateral or
any part thereof or in order better to assure and confirm
unto the Trustee its rights and remedies hereunder.
Section 28. Binding Agreement, Assignment. This Pledge Agreement shall
be binding upon the Pledgor and the Trustee and their
respective successors and assigns, and shall inure to the
benefit of the Pledgor, the Holders and the Trustee and the
respective successors and assigns of the Holders and the
Trustee.
Section 29. Governing Law; Severability. THIS PLEDGE AGREEMENT SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. If any term
or provision of this Pledge Agreement is held to be or
rendered invalid or unenforceable at any time in any
jurisdiction, such term or provision shall not affect the
validity or enforceability of any other terms or provisions
at any other time or in any other jurisdiction.
Section 30. WAIVER OF JURY TRIAL. THE TRUSTEE AND PLEDGOR EACH HEREBY
WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED
TO, OR CONNECTED WITH THIS AGREEMENT OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
Section 31. Headings. Section headings used herein are for convenience
only, and are not to affect the construction of, or be taken
into consideration in interpreting, this Pledge Agreement.
Section 32. Facsimile; Counterparts. Each party hereto may deliver an
executed signature page to this Pledge Agreement by
facsimile transmission to each other party, which facsimile
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copy shall be deemed to be an original executed signature
page; provided, however, that such party shall deliver an
original signature page to each other party promptly
thereafter. This Pledge Agreement may be executed in any
number of counterparts, each of which shall be deemed an
original and all of which counterparts together shall
constitute one agreement with the same effect as if the
parties hereto had signed the same signature.
Section 33. Limitations of Gaming and Liquor Regulations. The Trustee
acknowledges that: (a) its rights and remedies with respect
to the Pledged Collateral are subject to the limitations and
restrictions of the Gaming Laws and/or Liquor Laws which
may, among other things, require the Trustee to obtain the
prior approval of the Gaming Authority or Liquor License
Authority, as applicable, enforcing such laws before taking
any action hereunder and to be licensed by such authorities
before exercising certain rights and remedies hereunder and
(b) the Gaming Laws and Liquor Laws currently prohibit any
pledge, hypothecation or transfer of any Gaming Licenses,
Liquor Licenses, gambling devices or any interests therein
or attachment of any security interest in such licenses or
devices.
Section 34. Conflicts with Indenture. In the event of any conflict
between the provisions of this Pledge Agreement and those of
the Indenture, including, without limitation, any conflicts
or inconsistencies in any definitions herein or therein, the
applicable provisions or definitions or the Indenture shall
govern.
Section 35. Termination. Upon the indefeasible payment in full of all
Obligations (other than Unmatured Surviving Obligations) of
the Pledgor under the Indenture, the Senior Notes, this
Agreement or any other Transaction Document, or upon Legal
Defeasance or Covenant Defeasance, the Trustee shall, at the
request of the Pledgor, deliver a certificate to the Pledgor
stating that such Obligations have been paid in full, the
security interest granted herein shall terminate and all
rights to the Pledged Collateral shall revert to the
Pledgor. Upon any such termination the Trustee shall, at the
Pledgor's expense, execute and deliver to the Pledgor such
Uniform Commercial Code termination statements and such
other documents as the Pledgor shall reasonably request to
effect or evidence the termination and release of such
security interest in the Pledged Collateral.
[remainder of page intentionally left blank; signature page follows]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Pledge
Agreement to be duly executed, as of the day and year first above written.
[PLEDGOR]
By: _________________________
Name: _______________________
Title: ______________________
SUNTRUST BANK, as Trustee
By: _________________________
Name: _______________________
Title: ______________________
Schedule I
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______________________ PLEDGED STOCK
[to be filled in]
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