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EXHIBIT 10.24
SECURITY AGREEMENT
THIS SECURITY AGREEMENT, is entered into as of October 9,
1998, between FOOTHILL CAPITAL CORPORATION, a California corporation
("Foothill"), with a place of business located at 00000 Xxxxx Xxxxxx Xxxxxxxxx,
Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000, and LEISURE TIME CRUISE
CORPORATION, a Colorado corporation ("Borrower"), with its chief executive
office located at 0000 Xxxxxx Xxxx, Xxxx, Xxxx 00000.
The parties agree as follows:
1. DEFINITIONS AND CONSTRUCTION
1.1 Definitions. As used in this Agreement, the
following terms shall have the following definitions:
"Accounts" means all presently existing and
hereafter arising accounts, contract rights, and all other forms of obligations
owing to Borrower arising out of the sale or lease of goods or the rendition of
services by Borrower, whether or not earned by performance, and any and all
credit insurance, guaranties, and other security therefor, as well as all
merchandise returned to or reclaimed by Borrower and Borrower's Books relating
to any of the foregoing.
"Agreement" means this Security Agreement
and any extensions, riders, supplements, notes, amendments, or modifications to
or in connection with this Security Agreement.
"Borrower's Books" means all of Borrower's
books and records including: ledgers; records indicating, summarizing, or
evidencing Borrower's assets or liabilities, or the Collateral; all information
relating to Borrower's business operations or financial condition; and all
computer programs, disc or tape files, printouts, runs, or other computer
prepared information, and the equipment containing such information.
"Closing Date" means the date on which
Foothill makes the Term Loan to Borrower.
"Code" means the California Uniform
Commercial Code.
"Collateral" means each of the following:
the Accounts; Borrower's Books; the Equipment; the Freights; the General
Intangibles; the Inventory; the Negotiable Collateral; the Investment Property;
the collateral described in the First Preferred Ship Mortgage; any money, or
other assets of Borrower which hereafter come into the
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possession, custody, or control of Foothill; and the proceeds and products,
whether tangible or intangible, of any of the foregoing, including proceeds of
insurance covering any or all of the Collateral, and any and all Accounts,
Equipment, General Intangibles, Inventory, Negotiable Collateral, Investment
Property, money, deposit accounts, or other tangible or intangible property
resulting from the sale or other disposition of the Collateral, or any portion
thereof or interest therein, and the proceeds thereof.
"Corporate Guarantors" means Leisure Time
Casinos and Resorts, Inc. and Leisure Time Technology, Inc.
"Equipment" means all of Borrower's present
and hereafter acquired machinery, machine tools, motors, equipment, furniture,
furnishings, fixtures, vehicles (including motor vehicles and trailers), tools,
parts, dies, jigs, goods, including, without limitation, all items of equipment
and other personal property located on the Vessels (except for the equipment
listed on Schedule "E-2" attached hereto--which equipment is specifically
excluded herefrom), and any interest in any of the foregoing, and all
attachments, accessories, accessions, replacements, substitutions, additions,
and improvements to any of the foregoing, wherever located. Notwithstanding the
foregoing, "Equipment" shall not include (i) the Vegas Express, or (ii) any
vessels acquired by Borrower after the Closing Date (except to the extent such
after-acquired vessel(s) constitute proceeds of the Leisure Lady).
"Event of Default" has the meaning set
forth in Section 8.
"First Preferred Ship Mortgage" means the
first preferred ship mortgage executed by Borrower in connection with the Term
Loan that encumbers the Leisure Lady and secures the Term Loan.
"Foothill Expenses" means all: reasonable
costs or expenses (including taxes, photocopying, notarization,
telecommunication, and insurance premiums) required to be paid by Borrower
under any of the Loan Documents that are paid or advanced by Foothill;
documentation, filing, recording, publication, appraisal (including periodic
Collateral appraisals), and search fees assessed, paid, or incurred by Foothill
in connection with Foothill's transactions with Borrower; costs and expenses
incurred by Foothill in the disbursement of funds to Borrower (by wire transfer
or otherwise); charges paid or incurred by Foothill resulting from the dishonor
of checks; costs and expenses paid or incurred by Foothill to correct any
default or enforce any provision of the Loan Documents, or in gaining
possession of, maintaining, handling, preserving, removing (including, but not
limited to, all costs and expenses incurred by Foothill with respect to any
obligations of Foothill under a landlord's or mortgagee's waiver and consent
entered into in connection with the Loan Documents), storing, shipping,
selling, preparing for sale, or advertising to sell the Collateral, or any
portion thereof, whether or not a sale is consummated; costs and expenses paid
or incurred by Foothill in examining Borrower's Books; costs and expenses of
third party claims or any other suit paid or incurred by Foothill in enforcing
or defending the Loan Documents;
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and Foothill's reasonable attorneys' fees and expenses incurred in advising,
structuring, drafting, reviewing, administering, amending, terminating,
enforcing (including attorneys' fees and expenses incurred in connection with a
"workout", a "restructuring", or an Insolvency Proceeding concerning Borrower
or any guarantor of the Obligations), defending, or concerning the Loan
Documents, whether or not suit is brought.
"Freights" means all presently existing and
hereafter arising (i) freights, hire and other monies earned and to be earned,
due or to become due, or paid or payable to, or for the account of, Borrower,
of whatsoever nature, arising out of or as a result of the ownership and
operation by Borrower or its agents of the Vessels, (ii) all monies and claims
for moneys due and to become due to Borrower and all claims for damages arising
out of the breach of any and all present and future charter parties, bills of
lading, contracts and other engagements of affreightment or for the carriage or
transportation of cargo, mail and/or passengers, and operations of every kind
whatsoever of the Vessels and in and to any and all claims and causes of action
for money, loss or damages that may accrue or belong to Borrower, its
successors and assigns, arising out of or in any way connected with the present
or future use, operation or management of the Vessels or arising out of or in
any way connected with any and all present and further requisitions, charter
parties, bills of lading, contracts and other engagements of affreightment or
the carriage or transportation of cargo, mail and/or passengers, and other
operations of the Vessels, (iii) all monies and claims for monies due and to
become due to Borrower, and all claims for damages in respect of the actual or
constructive total loss of or requisition of use of or title to the Vessels,
and (iv) any proceeds of the foregoing. Notwithstanding anything to the
contrary herein, and so long as no Event of Default has occurred and is
continuing, any gaming or other revenue generated in the normal and customary
operation of the Vessels may be retained and used by Borrower for general
working capital purposes.
"GAAP" means generally accepted accounting
principles as in effect from time to time in the United States, consistently
applied.
"General Intangibles" means all of
Borrower's present and future general intangibles and other personal property
(including choses or things in action, goodwill, patents, trade names,
trademarks, service marks, copyrights, blueprints, drawings, purchase orders,
customer lists, monies due or recoverable from pension funds, route lists,
monies due under any royalty or licensing agreements, infringement claims,
computer programs, computer discs, computer tapes, literature, reports,
catalogs, deposit accounts, insurance premium rebates, tax refunds, and tax
refund claims) other than goods and Accounts, and Borrower's Books relating to
any of the foregoing; excluding, however, any general intangibles (including,
without limitation, licenses) which by their terms are not transferrable or
assignable (or which attempted transfer or assignment would be void).
"Guarantors" means, collectively, the
Corporate Guarantors and Xxxx Xxxxxxx, individually.
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"Insolvency Proceeding" means any
proceeding commenced by or against any person or entity under any provision of
the United States Bankruptcy Code, as amended, or under any other bankruptcy or
insolvency law, including assignments for the benefit of creditors, formal or
informal moratoria, compositions, extensions generally with its creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.
"Inventory" means all present and future
inventory in which Borrower has any interest, including goods held for sale or
lease or to be furnished under a contract of service and all of Borrower's
present and future raw materials, work in process, finished goods, and packing
and shipping materials, wherever located, and any documents of title
representing any of the above, and Borrower's Books relating to any of the
foregoing.
"Investment Property" means all Borrower's
present and hereafter acquired investment property, securities (certificated
and uncertificated), security entitlements, security accounts, and any interest
in any of the foregoing, and all replacements, substitutions, and additions to
any of the foregoing, wherever located.
"Judicial Officer or Assignee" means any
trustee, receiver, controller, custodian, assignee for the benefit of
creditors, or any other person or entity having powers or duties like or
similar to the powers and duties of a trustee, receiver, controller, custodian,
or assignee for the benefit of creditors.
"Leisure Lady" means the vessel known as
the "Leisure Lady", United States Coast Guard Official No. 671576, more fully
described on Exhibit "A" attached hereto.
"Loan Documents" means, collectively, this
Agreement, the Term Note, the First Preferred Ship Mortgage, and any other
agreement entered into in connection with this Agreement, together with all
alterations, amendments, changes, extensions, modifications, refinancings,
refundings, renewals, replacements, restatements, or supplements, of or to any
of the foregoing.
"Negotiable Collateral" means all of
Borrower's present and future letters of credit, notes, drafts, instruments,
documents, leases, and chattel paper, and Borrower's Books relating to any of
the foregoing.
"Obligations" means all loans, advances,
debts, principal, interest (including any interest that, but for the provisions
of the United States Bankruptcy Code, would have accrued), premiums,
liabilities (including all amounts charged to Borrower's loan account pursuant
to any agreement authorizing Foothill to charge Borrower's loan account),
obligations, fees, lease payments, guaranties, covenants, and duties owing by
Borrower to Foothill of any kind and description (whether pursuant to or
evidenced by the Loan Documents, by any note or other instrument, or by any
other agreement between Foothill and
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Borrower, and whether or not for the payment of money), whether direct or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, and including any debt, liability, or obligation owing from
Borrower to others that Foothill may have obtained by assignment or otherwise,
and further including all interest not paid when due and all Foothill Expenses
that Borrower is required to pay or reimburse by the Loan Documents, by law, or
otherwise. All Obligations shall accrue interest and the Monthly Service
Charges at the rate(s) set forth in the Term Note from the date such
Obligations arise, and such interest and Monthly Service Charges shall in turn
be deemed "Obligations" for all purposes under this Agreement and shall be due
and payable when interest and Monthly Service Charges are due and payable under
the Term Note.
"Pay-Off Letters" means letters, in form
and substance reasonably satisfactory to Foothill, from other lenders, secured
creditors, or lessors respecting the amount necessary to (a) repay in full all
of the obligations of Borrower owing to such lenders, secured creditors, and/or
lessors and (b) obtain (i) terminations/releases of all of the security
interests or liens existing in favor of such lenders, secured creditors, and/or
lessors in and to the properties or assets of Borrower and (ii) good and
marketable title to such properties or assets (in the case of leased property).
"Permitted Liens" means: (a) liens and
security interests held by Foothill; (b) liens for unpaid taxes that are not
yet due and payable; (c) purchase money security interests and liens of lessors
under capital leases, and so long as the security interest or lien only secures
the purchase price of the asset and does not encumber any other assets of the
Borrower; and (d) any liens or encumbrances permitted under the terms and
conditions of the First Preferred Ship Mortgage.
"Permitted Protest" means the right of
Borrower to protest any lien, tax, rental payment, or other charge, other than
any such lien or charge that secures the Obligations, provided (i) a reserve
with respect to such obligation is established on the books of Borrower in an
amount that is reasonably satisfactory to Foothill, (ii) any such protest is
instituted and diligently prosecuted by Borrower in good faith, and (iii)
Foothill is satisfied that, while any such protest is pending, there will be no
impairment of the enforceability, validity, or priority of any of the liens or
security interests of Foothill in and to the property or assets of Borrower.
"Term Loan" means the loan made by Foothill
to Borrower in connection with this Agreement, which loan is further evidenced
by the Term Note.
"Term Note" means that certain Secured
Promissory Note, of even date herewith, by Borrower to the order of Foothill,
in the original principal amount of Three Million Dollars ($3,000,000), and any
extensions, renewals, replacements, or substitutions therefor.
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"Vessels" means the vessels described on
Exhibit E-1 attached hereto and by this reference made a part hereof.
1.2 Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with GAAP. When
used herein, the term "financial statements" shall include the notes and
schedules thereto.
1.3 Code. Any terms used in this Agreement
which are defined in the Code shall be construed and defined as set forth in
the Code unless otherwise defined herein.
1.4 Construction. Unless the context of this
Agreement clearly requires otherwise, references to the plural include the
singular, to the singular include the plural, and the term "including" is not
limiting. The words "hereof," "herein," "hereby," "hereunder," and similar
terms in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement. Section, subsection, clause, and
exhibit references are to this Agreement unless otherwise specified.
1.5 Schedules and Exhibits. All of the
schedules and exhibits attached to this Agreement shall be deemed incorporated
herein by reference.
2. FEES.
Borrower shall pay to Foothill the following fees:
2.1 Closing Fee. A one time closing fee of
Thirty Thousand Dollars ($30,000) which is earned, in full, on the Closing Date
and is due and payable by Borrower to Foothill in connection with this
Agreement on the Closing Date;
2.2 Annual Fee. An annual fee equal to one
percent (1%) of the outstanding principal balance of the Obligations (as of
November 1, 1999, and each anniversary thereafter), which shall be due and
payable by Borrower to Foothill in connection with this Agreement on November
1, 1999, and on each anniversary of such date occurring thereafter; and
2.3 Appraisal and Documentation Fees.
Foothill's customary appraisal fee of Seven Hundred Fifty Dollars ($750) per
day per appraiser, plus out-of-pocket expenses for each appraisal of the
Collateral performed by Foothill or its agents.
3. CONDITIONS TO EFFECTIVENESS: TERM OF AGREEMENT.
3.1 Conditions Precedent. The obligation of
Foothill to make the loan evidenced by the Term Note is subject to the
fulfillment, to the satisfaction of Foothill and its counsel, of each of the
following conditions on or before the Closing Date:
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(a) The Closing Date shall occur on or
before October 30, 1998;
(b) Other than with respect to
Permitted Liens (if any), Borrower's existing lenders, creditors, and lessors
shall have executed and delivered Pay-Off Letters, UCC termination statements,
bills of sale, and other documentation evidencing the termination of their
liens and security interests in the assets of Borrower (and the transfer of
title to such assets to Borrower, in the case of leased property) or a
subordination agreement in form and substance satisfactory to Foothill in its
sole discretion;
(c) Foothill shall have received
copies of Borrower's and each Corporate Guarantor's By-laws and Articles or
Certificates of Incorporation, as amended, modified, or supplemented to the
Closing Date, certified by the Secretaries of Borrower and the Corporate
Guarantors;
(d) Foothill shall have received
certificates of corporate status with respect to Borrower and each Corporate
Guarantor, dated within ten (10) days of the Closing Date, by the
Secretary(ies) of State of the states of incorporation of Borrower and each
Corporate Guarantor, which certificate shall indicate that Borrower and each
Corporate Guarantor is in good standing in such state(s);
(e) Foothill shall have received a
certificate from the Secretaries of Borrower and each Corporate Guarantor
attesting to the resolutions of Borrower's and each Corporate Guarantor's Board
of Directors authorizing their execution and delivery of this Agreement and the
other Loan Documents to which each is a party and authorizing specific officers
of Borrower and each Corporate Guarantor to execute same;
(f) Foothill shall have received
certificates of corporate status with respect to Borrower, each dated within
ten (10) days of the Closing Date, such certificates to be issued by the
Secretary of State of the states in which its failure to be duly qualified or
licensed would have a material adverse effect on the financial condition or
assets of Borrower, which certificates shall indicate that Borrower is in good
standing;
(g) Foothill shall have received the
insurance certificates, certified copies of policies, required by Section 6.8
hereof and as required by the First Preferred Ship Mortgage, along with a
438BFU Lender's Loss Payable Endorsement naming Foothill as sole loss payee,
all in form and substance satisfactory to Foothill and its counsel;
(h) Foothill shall have received each
of the following documents and agreements, in form and substance satisfactory
to Foothill and its counsel, duly executed, and each such document and
agreement shall be in full force and effect:
(1) This Agreement;
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(2) The Term Note;
(3) The First Preferred Ship Mortgage;
(4) Continuing Guaranties from Xxxx
Xxxxxxx, individually, Leisure
Time Casinos & Resorts, Inc., and
Leisure Time Technology, Inc.;
(5) Equipment Security Agreement and
UCC-1 Financing Statements from
Leisure Time Technology, Inc.;
(6) Assignment of Insurances; and
(7) Such other documents and
instruments as Foothill shall deem
necessary or desirable to ensure
that Foothill has a first priority
perfected security interest in and
lien on the Collateral;
(i) Foothill shall have received
searches reflecting the filing of its financing statements and fixture filing;
(j) Foothill shall have received
evidence that the First Preferred Ship Mortgage has been duly filed with and
recorded by the United States Coast Guard, and that all other steps deemed
necessary or desirable by Foothill have been duly completed in order for
Foothill to have obtained a first priority perfected security interest in and
lien on the Leisure Lady;
(k) Foothill shall have received
landlord and mortgagee waivers from the lessors and mortgagees of the locations
where the Equipment is located;
(l) Foothill shall have received a
written opinion of Borrower's legal counsel in form and substance satisfactory
to Foothill with respect to the transactions governed by the Loan Documents;
(m) Foothill shall have received the
Closing Fee referenced in Section 2.1, all of Foothill Expenses incurred as of
the Closing Date, and all other costs and expenses incurred by Foothill in
connection herewith, including without limitation, audit fees, search fees,
appraisal fees, documentation, recording and filing fees, and the fees and
costs of Xxxxxx, Xxxxx and Xxxxxxx LLP, for the negotiation, preparation and
documentation of the Loan Documents;
(n) All representations and warranties
set forth in this
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Agreement and the other Loan Documents are true and correct as of the Closing
Date, no "Event of Default" has occurred under this Agreement or any of the
other Loan Documents, and all of the Loan Documents are in full force and
effect; and
(o) All other documents and legal
matters in connection with the transactions contemplated by this Agreement
shall have been delivered or executed or recorded and shall be in form and
substance satisfactory to Foothill and its counsel.
3.2 Term. This Agreement shall become effective
upon the execution and delivery hereof by Borrower and Foothill, and shall
continue in full force and effect until all Obligations have been indefeasibly
paid in full.
4. CREATION OF SECURITY INTEREST
4.1 Grant of Security Interest. Borrower hereby
grants to Foothill a continuing security interest in all currently existing and
hereafter acquired or arising Collateral in order to secure prompt repayment of
any and all Obligations and in order to secure prompt performance by Borrower
of each of its covenants and duties under the Loan Documents. Foothill's
security interest in the Collateral shall attach to all Collateral without
further act on the part of Foothill or Borrower.
4.2 Delivery of Additional Documentation
Required. Borrower shall execute and deliver to Foothill, prior to or
concurrently with Borrower's execution and delivery of this Agreement and at
any time thereafter at the request of Foothill, all financing statements,
continuation financing statements, fixture filings, security agreements,
chattel mortgages, pledges, assignments, endorsements of certificates of title,
applications for title, affidavits, reports, notices, letters of authority, and
all other documents that Foothill may reasonably request, in form satisfactory
to Foothill, to perfect and continue perfected Foothill's security interests in
the Collateral and in order to fully consummate all of the transactions
contemplated under the Loan Documents.
4.3 Power of Attorney. Borrower hereby
irrevocably makes, constitutes, and appoints Foothill (and any of Foothill's
officers, employees, or agents designated by Foothill) as Borrower's true and
lawful attorney, with power to: (a) sign the name of Borrower on any of the
documents described in Section 4.2 or on any other similar documents to be
executed, recorded, or filed in order to perfect or continue perfected
Foothill's security interest in the Collateral; (b) at any time that an Event
of Default has occurred or Foothill deems itself insecure, endorse Borrower's
name on any checks, notices, acceptances, money orders, drafts, or other item
of payment or security that may come into Foothill's possession; (c) at any
time that an Event of Default has occurred or Foothill deems itself insecure,
make, settle, and adjust all claims under Borrower's policies of insurance in
respect of the Collateral and make all determinations and decisions with
respect to such policies of insurance. The appointment of Foothill as
Borrower's attorney, and each and every
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one of Foothill's rights and powers, being coupled with an interest, is
irrevocable until all of the Obligations have been fully repaid and performed
and Foothill's obligation to provide advances hereunder is terminated.
4.4 Right to Inspect. Foothill (through any of
its officers, employees, or agents) shall have the right, from time to time
hereafter, to inspect Borrower's Books and to check, test, and appraise the
Collateral in order to verify Borrower's financial condition or the amount,
quality, value, condition of, or any other matter relating to, the Collateral.
5. REPRESENTATIONS AND WARRANTIES.
Borrower represents and warrants as follows:
5.1 Prior Encumbrances. Borrower has good and
indefeasible title to the Collateral, free and clear of liens, claims, security
interests, or encumbrances except for Permitted Liens. None of the Collateral
has been purchased by Borrower within the six (6) months period preceding the
Closing Date, except for sales to Borrower in the ordinary course of the
seller's business.
5.2 Location of Equipment. The Equipment is not
now and shall not at any time hereafter be stored with a bailee, warehouseman,
or similar party without Foothill's prior written consent. Borrower shall keep
the Equipment only on the Leisure Lady or at the following locations: (1) 0000
Xxxxxx Xxxx, Xxxx, Xxxx 00000, or (2) 000 Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxx
Xxxxxxxx.
None of the Equipment has been located, during the
six (6) month period prior to the Closing Date, in any jurisdiction other than
the county(ies) and state(s) set forth in this Section.
5.3 Location of Chief Executive Office. The
chief executive office of Borrower is located at the address indicated in the
first paragraph of this Agreement and Borrower covenants and agrees that it
will not, without thirty (30) days prior written notification to Foothill,
relocate such chief executive office.
5.4 Fictitious Business Name(s). Borrower uses
only the following Fictitious Business Names and none other: [none].
5.5 Due Organization and Qualification.
Borrower is and shall at all times hereafter be duly organized and existing and
in good standing under the laws of the state of its incorporation and qualified
and licensed to do business in, and in good standing in, any state in which the
conduct of its business or its ownership of the Collateral requires that it be
so qualified.
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5.6 Due Authorization; No Conflict. The
execution, delivery, and performance of the Loan Documents are within
Borrower's corporate powers, have been duly authorized, and are not in conflict
with nor constitute a breach of any provision contained in Borrower's Articles
or Certificate of Incorporation, or By-laws, nor will they constitute an event
of default under any material agreement to which Borrower is a party.
5.7 Litigation. There are no actions or
proceedings pending by or against Borrower before any court or administrative
agency and Borrower does not have knowledge or belief of any pending,
threatened, or imminent litigation, governmental investigations, or claims,
complaints, actions, or prosecutions involving Borrower or any guarantor of the
Obligations, except for ongoing collection matters in which the Borrower is the
plaintiff.
5.8 No Material Adverse Change in Financial
Condition. All financial statements relating to Borrower or any guarantor of
the Obligations that have been or may hereafter be delivered by Borrower to
Foothill have been prepared in accordance with GAAP and fairly present
Borrower's and such guarantor's financial condition as of the date thereof and
Borrower's and such guarantor's results of operations for the period then
ended. There has not been a material adverse change in the financial condition
of Borrower or any guarantor since the date of the latest financial statements
submitted to Foothill on or before the Closing Date.
5.9 Solvency. Borrower's assets at a fair
valuation exceed the amount of all of its debts at a fair valuation and
Borrower is able to pay all of its debts (including trade debts and contingent
liabilities) as they become due.
5.10 Environmental Condition. None of Borrower's
properties or assets has ever been used by Borrower or, to the best of
Borrower's knowledge, by previous owners or operators in the disposal of, or to
produce, store, handle, treat, release, or transport, any hazardous waste or
hazardous substance in violation of any law, statute, rule, regulation, or
policy of any federal or state governmental agency. None of Borrower's
properties or assets has ever been designated or identified in any manner
pursuant to any environmental protection statute as a hazardous waste or
hazardous substance disposal site, or a candidate for closure pursuant to any
environmental protection statute. No lien arising under any environmental
protection statute has attached to any revenues or to any real or personal
property owned or operated by Borrower. Borrower has not received a summons,
citation, notice, or directive from the Environmental Protection Agency or any
other federal or state governmental agency concerning any action or omission by
Borrower resulting in the releasing or disposing of hazardous waste or
hazardous substances into the environment.
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5.11 Reliance by Foothill; Cumulative. Each
warranty and representation contained in this Agreement shall be conclusively
presumed to have been relied on by Foothill regardless of any investigation
made or information possessed by Foothill. The warranties and representations
set forth herein shall be cumulative and in addition to any and all other
warranties and representations that Borrower shall now or hereinafter give, or
cause to be given, to Foothill.
6. AFFIRMATIVE COVENANTS.
Borrower covenants and agrees that, so long as any
credit hereunder shall be available and until payment in full of the
Obligations, and unless Foothill shall otherwise consent in writing, Borrower
shall do all of the following:
6.1 Financial Statements, Reports,
Certificates. Borrower agrees to deliver to Foothill: (a) as soon as available,
but in any event within thirty (30) days after the end of each month during
each of Borrower's fiscal years, a company prepared balance sheet, income
statement, and cash flow statement covering Borrower's operations during such
period; and (b) as soon as available, but in any event within ninety (90) days
after the end of each of Borrower's fiscal years, financial statements of
Borrower for each such fiscal year, reviewed by independent certified public
accountants acceptable to Foothill and certified, without any qualifications,
by such accountants to have been prepared in accordance with GAAP, together
with a certificate of such accountants addressed to Foothill stating that such
accountants do not have knowledge of the existence of any event or condition
constituting an Event of Default, or that would, with the passage of time or
the giving of notice, constitute an Event of Default. Such reviewed financial
statements shall include a balance sheet, profit and loss statement, and cash
flow statement, and such accountants' letter to management. Borrower shall have
issued written instructions to its independent certified public accountants
authorizing them to communicate with Foothill and to release to Foothill
whatever financial information concerning Borrower that Foothill may request.
If Borrower is a parent company of one or more subsidiaries, or affiliates, or
is a subsidiary or affiliate of another company, then, in addition to the
financial statements referred to above, Borrower agrees to deliver financial
statements prepared on a consolidating basis so as to present Borrower and each
such related entity separately, and on a consolidated basis.
Borrower hereby irrevocably authorizes and directs all
auditors, accountants, or other third parties to deliver to Foothill, at
Borrower's expense, copies of Borrower's financial statements, papers related
thereto, and other accounting records of any nature in their possession, and to
disclose to Foothill any information they may have regarding Borrower's
business affairs and financial conditions.
6.2 Other Reports. Borrower agrees to deliver
to Foothill by no later than the fifteenth (15th) day of each month, an
accounts receivable and accounts payable aging report as of the end of the
prior calendar month. Borrower agrees to deliver to Foothill within
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three (3) business days after Borrower's payroll taxes are due, evidence that
such payroll taxes have been timely and fully paid.
6.3 Tax Returns. Borrower agrees to deliver to
Foothill copies of each of Borrower's future federal income tax returns, and
any amendments thereto, within thirty (30) days of the filing thereof with the
Internal Revenue Service.
6.4 Guarantor Reports. Borrower agrees to cause
any guarantor of any of the Obligations to deliver its annual financial
statements at the time when Borrower provides its reviewed financial statements
to Foothill and copies of all federal income tax returns as soon as the same
are available and in any event no later than thirty (30) days after the same
are required to be filed by law.
6.5 Title to Equipment. Upon Foothill's
request, Borrower shall immediately deliver to Foothill, properly endorsed, any
and all evidences of ownership of, certificates of title, or applications for
title to any items of Equipment.
6.6 Maintenance of Equipment. Borrower shall
keep and maintain the Equipment in good operating condition and repair, and
make all necessary replacements thereto so that the value and operating
efficiency thereof shall at all times be maintained and preserved. Borrower
shall not permit any item of Equipment to become a fixture to real estate or an
accession to other property, and the Equipment is now and shall at all times
remain personal property.
6.7 Taxes. All assessments and taxes, whether
real, personal, or otherwise, due or payable by, or imposed, levied, or
assessed against Borrower or any of its property have been paid, and shall
hereafter be paid in full, before delinquency or before the expiration of any
extension period. Borrower shall make due and timely payment or deposit of all
federal, state, and local taxes, assessments, or contributions required of it
by law, and will execute and deliver to Foothill, on demand, appropriate
certificates attesting to the payment or deposit thereof. Borrower shall make
timely payment or deposit of all tax payments and withholding taxes required of
it by applicable laws, including those laws concerning F.I.C.A., F.U.T.A.,
state disability, and local, state, and federal income taxes, and shall, upon
request, furnish Foothill with proof satisfactory to Foothill indicating that
Borrower has made such payments or deposits.
6.8 Insurance.
(a) Borrower, at its expense, shall
keep the Collateral insured against "all risks" including loss or damage by
fire, theft, explosion, sprinklers, and all other hazards and risks, and in the
full insurable value thereof. Borrower also shall maintain public liability,
product liability, and property damage insurance relating to Borrower's
ownership and use of the Collateral, as well as insurance against larceny,
embezzlement, and criminal misappropriation.
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(b) All such policies of insurance
shall be in such form, with such companies, and in such amounts as may be
satisfactory to Foothill. All such policies of insurance (except those of
public liability and property damage) shall contain a 438BFU lender's loss
payable endorsement, or an equivalent endorsement in a form satisfactory to
Foothill, showing Foothill as loss payee thereof, and shall contain a waiver of
warranties, and shall specify that the insurer must give at least ten (10) days
prior written notice to Foothill before canceling its policy for any reason.
Borrower shall deliver to Foothill certified copies of such policies of
insurance and evidence of the payment of all premiums therefor. All proceeds
payable under any such policy shall be payable to Foothill to be applied on
account of the Obligations.
6.9 Foothill Expenses. Borrower shall
immediately and without demand reimburse Foothill for all sums expended by
Foothill which constitute Foothill Expenses and Borrower hereby authorizes and
approves all advances and payments by Foothill for items constituting Foothill
Expenses. Any Foothill Expenses not paid promptly by Borrower shall constitute
Obligations and shall accrue interest at the rate and in the manner of
Obligations existing under the Term Note.
6.10 No Setoffs or Counterclaims. All payments
hereunder and under the other Loan Documents made by or on behalf of Borrower
shall be made without setoff or counterclaim and free and clear of, and without
deduction or withholding for or on account of, any federal, state or local
taxes.
6.11 Compliance with Laws. Borrower shall comply
with all applicable laws, rules, and regulations. Without limiting the
generality of the foregoing, Borrower shall (i) at all times operate the
Vessels in accordance with all applicable laws, rules and regulations, and (ii)
not be permitted to place any slot machines, similar gaming equipment, or other
gaming equipment on the Leisure Lady unless Foothill determines in Foothill's
discretion that it would not violate any applicable law.
7. NEGATIVE COVENANTS.
Borrower covenants and agrees that, so long as any
credit hereunder shall be available and until payment in full of the
Obligations, Borrower will not do any of the following without Foothill's prior
written consent:
7.1 Liens. Create, incur, assume, or permit to
exist, directly or indirectly, any lien on or with respect to any of the
Collateral, of any kind, whether now owned or hereafter acquired, or any income
or profits therefrom, except for Permitted Liens.
7.2 Restrictions on Fundamental Changes. Enter
into any
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acquisition, merger, consolidation, reorganization, or recapitalization, or
reclassify its capital stock, or liquidate, wind up, or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, assign, lease,
transfer, or otherwise dispose of, in one transaction or a series of
transactions, all or any substantial part of its business, property, or assets,
whether now owned or hereafter acquired, or acquire by purchase or otherwise
all or substantially all the assets, stock, or other evidence of beneficial
ownership of any person or entity.
7.3 Extraordinary Transactions and Disposal of
Collateral. Sell, lease, or otherwise dispose of, move, relocate, or transfer,
whether by sale or otherwise, any of the Collateral. Notwithstanding the
foregoing, Borrower shall maintain ownership of the Vessels at all times,
unless Foothill consents (in Foothill's sole discretion) to a transfer to
another affiliate entity (on terms and conditions satisfactory to Foothill in
Foothill's sole discretion).
7.4 Change Name. Change Borrower's name,
business structure, or identity, or add any new fictitious name.
8. EVENTS OF DEFAULT.
Any one or more of the following events shall
constitute an event of default (each, an "Event of Default") under this
Agreement:
8.1 If Borrower fails to pay when due and
payable or when declared due and payable, any portion of the Obligations
(whether of principal, interest (including any interest which, but for the
provisions of the United States Bankruptcy Code, would have accrued on such
amounts), fees and charges due Foothill, taxes, reimbursement of Foothill
Expenses, or otherwise);
8.2 If Borrower fails or neglects to perform,
keep, or observe any term, provision, condition, covenant, or agreement
contained in this Agreement, in any of the Loan Documents, or in any other
present or future agreement between Borrower and Foothill;
8.3 If there is a material impairment of the
prospect of repayment of any portion of the Obligations owing to Foothill or a
material impairment of the value or priority of Foothill's security interests
in the Collateral;
8.4 Except as (and only to the extent)
expressly permitted in the First Preferred Ship Mortgage with respect to the
Leisure Lady, if any material portion of Borrower's assets is attached, seized,
subjected to a writ or distress warrant, or is levied upon, or comes into the
possession of any Judicial Officer or Assignee;
8.5 If an Insolvency Proceeding is commenced by
Borrower;
8.6 If an Insolvency Proceeding is commenced
against Borrower;
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8.7 If Borrower is enjoined, restrained, or in
any way prevented by court order from continuing to conduct all or any material
part of its business affairs;
8.8 Except as (and only to the extent)
expressly permitted in the First Preferred Ship Mortgage with respect to the
Leisure Lady, if a notice of lien, levy, or assessment is filed of record with
respect to any of Borrower's assets by the United States Government, or any
department, agency, or instrumentality thereof, or by any state, county,
municipal, or governmental agency, or if any taxes or debts owing at any time
hereafter to any one or more of such entities becomes a lien, whether xxxxxx or
otherwise, upon any of Borrower's assets and the same is not paid on the
payment date thereof;
8.9 If a judgment or other claim becomes a lien
or encumbrance upon any material portion of Borrower's assets;
8.10 If there is a default in any material
agreement to which Borrower is a party with third parties resulting in a right
by such third parties, whether or not exercised, to accelerate the maturity of
Borrower's indebtedness thereunder;
8.11 If any misstatement or misrepresentation
exists now or hereafter in any warranty, representation, statement, or report
made to Foothill by Borrower or any officer, employee, agent, or director of
Borrower, or if any such warranty or representation is withdrawn by any officer
or director; or
8.12 If the obligation of any guarantor or other
third party under any Loan Document is limited or terminated by operation of
law or by the guarantor or other third party thereunder, or any such guarantor
or other third party becomes the subject of an Insolvency Proceeding.
9. FOOTHILL'S RIGHTS AND REMEDIES
9.1 Rights and Remedies. Upon the occurrence of
an Event of Default Foothill may, at its election, without notice of its
election and without demand, do any one or more of the following, all of which
are authorized by Borrower:
(a) Declare all Obligations, whether
evidenced by this Agreement, by any of the other Loan Documents, or otherwise,
immediately due and payable;
(b) Terminate this Agreement and any
of the other Loan Documents as to any future liability or obligation of
Foothill, but without affecting Foothill's rights and security interest in the
Collateral and without affecting the Obligations;
(c) Without notice to or demand upon
Borrower or any guarantor, make such payments and do such acts as Foothill
considers necessary or reasonable
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to protect its security interest in the Collateral. Borrower agrees to assemble
the Collateral if Foothill so requires, and to make the Collateral available to
Foothill as Foothill may designate. Borrower authorizes Foothill to enter the
premises where the Collateral is located, to take and maintain possession of
the Collateral, or any part of it, and to pay, purchase, contest, or compromise
any encumbrance, charge, or lien that in Foothill's determination appears to be
prior or superior to its security interest and to pay all expenses incurred in
connection therewith. With respect to any of Borrower's owned premises,
Borrower hereby grants Foothill a license to enter into possession of such
premises and to occupy the same, without charge, for up to one hundred twenty
(120) days in order to exercise any of Foothill's rights or remedies provided
herein, at law, in equity, or otherwise;
(d) Without notice to Borrower (such
notice being expressly waived) set off and apply to the Obligations any and all
(i) balances and deposits of Borrower held by Foothill, or (ii) indebtedness at
any time owing to or for the credit or the account of Borrower held by
Foothill;
(e) Store, maintain, repair, prepare
for sale, advertise for sale, and sell (in the manner provided for herein) the
Collateral. Foothill is hereby granted a license or other right to use, without
charge, Borrower's labels, patents, copyrights, rights of use of any name,
trade secrets, trade names, trademarks, service marks, and advertising matter,
or any property of a similar nature, as it pertains to the Collateral,
advertising for sale and selling any Collateral and Borrower's rights under all
licenses and all franchise agreements shall inure to Foothill's benefit;
(f) Sell the Collateral at either a
public or private sale, or both, by way of one or more contracts or
transactions, for cash or on terms, in such manner and at such places
(including Borrower's premises) as Foothill determines is commercially
reasonable. It is not necessary that the Collateral be present at any such
sale;
(g) Foothill may credit bid and
purchase at any public sale.
Foothill shall give notice of the disposition of the Collateral as follows:
(i) Foothill shall give Borrower
and each holder of a security interest in the Collateral who
has filed with Foothill a written request for notice, a
notice in writing of the time and place of public sale, or,
if the sale is a private sale or some other disposition other
than a public sale is to be made of the Collateral, then the
time on or after which the private sale or other disposition
is to be made;
(ii) The notice shall be
personally delivered or mailed, postage prepaid, to Borrower
as provided in Section 12, at least five (5) calendar days
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before the date fixed for the sale, or at least five (5)
calendar days before the date on or after which the private
sale or other disposition is to be made, unless the
Collateral is perishable or threatens to decline speedily in
value. Notice to persons other than Borrower claiming an
interest in the Collateral shall be sent to such addresses as
they have furnished to Foothill; and
(iii) If the sale is to be a
public sale, Foothill also shall give notice of the time and
place by publishing a notice one time at least five (5)
calendar days before the date of the sale in a newspaper of
general circulation in the county in which the sale is to be
held.
9.2 Deficiency; Excess Proceeds. Any deficiency
that exists after disposition of the Collateral as provided above will be paid
immediately by Borrower. Any excess will be returned, without interest and
subject to the rights of third parties, by Foothill to Borrower.
9.3 Remedies Cumulative. Foothill's rights and
remedies under this Agreement, the Loan Documents, and all other agreements
shall be cumulative. Foothill shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by Foothill of one right or remedy shall be deemed an election, and no
waiver by Foothill of any Event of Default shall be deemed a continuing waiver.
No delay by Foothill shall constitute a waiver, election, or acquiescence by
it.
100 TAXES AND EXPENSES REGARDING THE COLLATERAL
Except with respect to Permitted Protests, if
Borrower fails to pay any monies (whether taxes, rents, assessments, insurance
premiums, or otherwise) due to third persons or entities, or fails to make any
deposits or furnish any required proof of payment or deposit, all as required
under the terms of this Agreement, then, to the extent that Foothill determines
that such failure by Borrower could have a material adverse effect on
Foothill's interests in the Collateral, in its discretion and without prior
notice to Borrower, Foothill may do any or all of the following: (a) make
payment of the same or any part thereof; or (b) obtain and maintain insurance
policies of the type described in Section 6.8, and take any action with respect
to such policies as Foothill deems prudent. Any amounts paid or deposited by
Foothill shall constitute Foothill Expenses, shall be immediately charged to
Borrower and become additional Obligations, shall bear interest at the then
applicable rate set forth in the Term Note, and shall be secured by the
Collateral. Any payments made by Foothill shall not constitute an agreement by
Foothill to make similar payments in the future or a waiver by Foothill of any
Event of Default under this Agreement. Foothill need not inquire as to, or
contest the validity of, any such expense, tax, security interest, encumbrance,
or lien and the receipt of the usual official notice for the payment thereof
shall be conclusive evidence that the same was validly due and owing.
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110 WAIVERS; INDEMNIFICATION
11.1 Demand; Protest; etc. Borrower waives
demand, protest, notice of protest, notice of default or dishonor, notice of
payment and nonpayment, notice of any default, nonpayment at maturity, release,
compromise, settlement, extension, or renewal of accounts, documents,
instruments, chattel paper, and guarantees at any time held by Foothill on
which Borrower may in any way be liable.
11.2 Foothill's Liability for Collateral. So
long as Foothill complies with its obligations, if any, under Section 9207 of
the Code, Foothill shall not in any way or manner be liable or responsible for:
(a) the safekeeping of the Collateral; (b) any loss or damage thereto occurring
or arising in any manner or fashion from any cause; (c) any diminution in the
value thereof; or (d) any act or default of any carrier, warehouseman, bailee,
forwarding agency, or other person. All risk of loss, damage, or destruction of
the Collateral shall be borne by Borrower.
11.3 Indemnification. Borrower agrees to
indemnify Foothill and its officers, employees, and agents and hold Foothill
harmless against: (a) all obligations, demands, claims, and liabilities claimed
or asserted by any other party, and (b) all losses in any way suffered,
incurred, or paid by Foothill as a result of or in any way arising out of,
following, or consequential to transactions with Borrower whether under this
Agreement, or otherwise. This provision shall survive the termination of this
Agreement.
120 NOTICES
Unless otherwise provided in this Agreement, all
notices or demands by any party relating to this Agreement or any other
agreement entered into in connection therewith shall be in writing and (except
for financial statements and other informational documents which may be sent by
first-class mail, postage prepaid) shall be personally delivered or sent by
registered or certified mail, postage prepaid, return receipt requested, or by
prepaid telex, TWX, telefacsimile, or telegram (with messenger delivery
specified) to Borrower or to Foothill, as the case may be, at its addresses set
forth below:
If to Borrower: LEISURE TIME CRUISE CORPORATION
0000 Xxxxxx Xxxx
Xxxx, Xxxx 00000
Attn: Mr. Xxxx Xxxxxxx.
Telecopy No.:
-------------------
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If to Foothill: FOOTHILL CAPITAL CORPORATION
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn.: Small Business Lending Division Manager
Telecopy No.: 000-000-0000
The parties hereto may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the other. All
notices or demands sent in accordance with this Section 12, other than notices
by Foothill in connection with Sections 9504 or 9505 of the Code, shall be
deemed received on the earlier of the date of actual receipt or three (3)
calendar days after the deposit thereof in the mail. Borrower acknowledges and
agrees that notices sent by Foothill in connection with Sections 9504 or 9505
of the Code shall be deemed sent when deposited in the mail or transmitted by
telefacsimile or other similar method set forth above.
130 CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER
THE VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE
DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION
WITH THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL
COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA OR, AT THE
SOLE OPTION OF FOOTHILL, IN ANY OTHER COURT IN WHICH FOOTHILL SHALL INITIATE
LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER
THE MATTER IN CONTROVERSY. EACH OF BORROWER AND FOOTHILL WAIVES, TO THE EXTENT
PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE
OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS
BROUGHT IN ACCORDANCE WITH THIS SECTION 13. BORROWER AND FOOTHILL HEREBY WAIVE
THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. BORROWER AND FOOTHILL
REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE
EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT
TO A TRIAL BY THE COURT.
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140 DESTRUCTION OF BORROWER'S DOCUMENTS
All documents, agings, or other papers delivered to
Foothill may be destroyed or otherwise disposed of by Foothill four (4) months
after they are delivered to or received by Foothill, unless Borrower requests,
in writing, the return of said documents, schedules, or other papers and makes
arrangements, at Borrower's expense, for their return.
150 GENERAL PROVISIONS
15.1 Effectiveness. This Agreement shall be
binding and deemed effective when executed by Borrower and Foothill.
15.2 Successors and Assigns. This Agreement
shall bind and inure to the benefit of the respective successors and assigns of
each of the parties; provided, however, that Borrower may not assign this
Agreement or any rights or duties hereunder without Foothill's prior written
consent and any prohibited assignment shall be absolutely void. No consent to
an assignment by Foothill shall release Borrower from its Obligations. Foothill
may assign this Agreement and its rights and duties hereunder. Foothill
reserves the right to sell, assign, transfer, negotiate, or grant
participations in all or any part of, or any interest in Foothill's rights and
benefits hereunder. In connection therewith, Foothill may disclose all
documents and information which Foothill now or hereafter may have relating to
Borrower or Borrower's business. To the extent that Foothill assigns its rights
and obligations hereunder to a third party, Foothill shall thereafter be
released from such assigned obligations to Borrower and such assignment shall
effect a novation between Borrower and such third party.
15.3 Section Headings. Headings and numbers have
been set forth herein for convenience only. Unless the contrary is compelled by
the context, everything contained in each paragraph applies equally to this
entire Agreement.
15.4 Interpretation. Neither this Agreement nor
any uncertainty or ambiguity herein shall be construed or resolved against
Foothill or Borrower, whether under any rule of construction or otherwise. On
the contrary, this Agreement has been reviewed by all parties and shall be
construed and interpreted according to the ordinary meaning of the words used
so as to fairly accomplish the purposes and intentions of all parties hereto.
15.5 Severability of Provisions. Each provision
of this Agreement shall be severable from every other provision of this
Agreement for the purpose of determining the legal enforceability of any
specific provision.
15.6 Amendments in Writing. This Agreement
cannot be changed or terminated orally. All prior agreements, understandings,
representations, warranties, and
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negotiations, if any, are merged into this Agreement.
15.7 Counterparts. This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one
and the same Agreement.
15.8 Revival and Reinstatement of Obligations.
If the incurrence or payment of the Obligations by Borrower or any guarantor of
the Obligations or the transfer by either or both of such parties to Foothill
of any property of either or both of such parties should for any reason
subsequently be declared to be improper under any state or federal law relating
to creditors' rights, including, without limitation, provisions of the United
States Bankruptcy Code relating to fraudulent conveyances, preferences, and
other voidable or recoverable payments of money or transfers of property
(collectively, a "Voidable Transfer"), and if Foothill is required to repay or
restore, in whole or in part, any such Voidable Transfer, or elects to do so
upon the reasonable advice of its counsel, then, as to any such Voidable
Transfer, or the amount thereof that Foothill is required to repay or restore,
and as to all reasonable costs, expenses and attorneys' fees of Foothill
related thereto, the liability of Borrower or such guarantor shall
automatically be revived, reinstated, and restored and shall exist as though
such Voidable Transfer had never been made.
15.9 Integration. This Agreement, together with
the other Loan Documents, reflects the entire understanding of the parties with
respect to the transactions contemplated hereby and shall not be contradicted,
modified, or qualified by any other agreement, oral or written, whether before
or after the date hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed at Los Angeles, California.
"Borrower"
LEISURE TIME CRUISE CORPORATION,
a Colorado corporation
By: /s/
-----------------------------
Print Name:
Title:
Accepted and effective this ___th day of October, 1998.
"Foothill"
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/
--------------------------
Print Name:
Its:
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SCHEDULE E-1
VESSELS
1. Name: LEISURE LADY
Official No.: 671576
Hailing Port: NEW YORK, NEW YORK
Gross Tons: 88
Net Tons: 88
Built: 1984 (Chesapeake Shipbuilding, Maryland)
Length Overall: 137 feet
Depth: 7.5 feet
2. Name: VEGAS EXPRESS
Official No.: 594643
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SCHEDULE "E-2"
EQUIPMENT EXCLUDED FROM DEFINITION OF COLLATERAL
All equipment located on the Vegas Express as of the Closing Date and any
additional equipment acquired after the Closing Date by Borrower for use on the
Vegas Express (other than the video gaming machines owned by Leisure Time
Technology, Inc. described on Schedule "E-3" attached hereto (which are
currently located in Lorain County, Ohio and Greenville, South Carolina)).
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SCHEDULE "E-3"
SEE ATTACHED LIST OF EQUIPMENT OWNED BY
LEISURE TIME TECHNOLOGY, INC. (IN WHICH FOOTHILL SHALL HAVE A SECURITY INTEREST)
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