ENVIRONMENTAL INDEMNITY
(Riviera Hotel & Casino in Las Vegas, Nevada)
This Environmental Indemnity (as amended, modified or
otherwise supplemented from time to time, this "Indemnity") is made and entered
into as of July __, 2002, by and between RIVIERA HOLDINGS CORPORATION, a Nevada
corporation ("RHC"), as indemnitor ("Indemnitor"), and FOOTHILL CAPITAL
CORPORATION, having an office at 0000 Xxxxxxxx Xxxxxx, Xxxxx 0000 Xxxx (Xxxx:
Structured Finance Group Manager), Xxxxx Xxxxxx, Xxxxxxxxxx 00000, in its
capacity as the Agent under the Loan Agreement referred to below (together with
its successors and assigns, "Agent") for the benefit of the Lender Group
referred to below.
RECITALS
A. RHC is the present owner of the real property located
in Las Vegas, Nevada included in the Collateral and more particularly described
on Exhibit A (the "Trust Property").
B. RHC and the Agent are, contemporaneously with the execution
and delivery of this Indemnity, entering into that certain Loan and Security
Agreement, dated as of substantially even date herewith (as amended, restated,
supplemented, or otherwise modified from time to time, the "Loan Agreement"), by
and among RHC, Riviera Black Hawk, Inc., and Riviera Operating Corporation
(individually and collectively, and jointly and severally, the "Borrower"), the
other Restricted Subsidiaries identified therein as the "Guarantors", the
lenders identified therein as the "Lenders", and Foothill Capital Corporation as
the "Agent". As used herein and in the Loan Agreement, the term "Lender Group"
means, individually and collectively, the Agent and the Lenders.
C. The Loan Agreement and the Obligations are secured, in
part, by RHC's interest in the Trust Property. The Trust Property is secured by
that certain Deed of Trust, Assignment of Rents, Leases, Fixture Filing and
Security Agreement, between RHC and the Agent (for the benefit of the Lender
Group), dated as of the date hereof (as the same may be amended, restated,
supplemented, or otherwise modified from time to time, the "Deed of Trust").
D. The Lender Group has required, as a condition precedent to
entering into the Loan Agreement, that Indemnitor shall have executed and
delivered this Indemnity in favor of the Agent for the benefit of the Lender
Group.
NOW, THEREFORE, the parties hereto agree as follows:
1. Recitals. The Recitals are incorporated herein by this reference.
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2. Definitions. Capitalized terms used herein but not otherwise
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defined shall have the meanings assigned to such terms in the Loan and Security
Agreement. For purposes of this Indemnity, the following terms have the
meanings set forth below.
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"Adjacent Property" means any property so situated as to pose
a risk that a Hazardous Material could spread onto the Trust Property.
"Environmental Laws" collectively means and includes any and
all applicable present and, other than with respect to Section 3, future local,
state and federal law relating to the environment and environmental conditions,
including, without limitation: the Nevada Hazardous Materials Act (NRS Chapter
459); NRS Chapters 444, 445A, 445B and 445C; NRS Chapter 590; NRS ss. 477.045;
NRS ss. 618.750 to 618.850, inclusive; the Uniform Fire Code, as adopted by and
now or hereafter in effect in the State of Nevada; the Resource Conservation and
Recovery Act of 1976 ("RCRA"), 42 U.S.C. ss. 6901 et seq.; the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42
U.S.C. xx.xx. 9601-9657, as amended by the Superfund Amendments and
Reauthorization Act of 1986 ("XXXX"), the Hazardous Materials Transportation
Act, 49 U.S.C. ss. 6901, et seq.; the Federal Water Pollution Control Act, 33
U.S.C. xx.xx. 1251 et seq.; the Clean Air Act, 42 U.S.C. xx.xx. 741 et seq.; the
Clean Water Act, 33 U.S.C. ss. 7401 et seq.; the Toxic Substances Control Act,
15 U.S.C. xx.xx. 2601-2629, the Safe Drinking Water Act, 42 U.S.C. xx.xx.
300f-300j, or any other similar federal, state or local law of similar effect,
each as amended, and any and all regulations, orders, and decrees now or
hereafter promulgated thereunder or any and all common law requirements, rules
and bases of liability regulating, relating to or imposing liability or
standards of conduct concerning pollution or protection of human health or the
environment, as now or may at any time hereafter be in effect.
"Hazardous Materials" means any substance, material or waste
that is or becomes designated or regulated as "toxic", "hazardous", pollutant",
or "contaminant" or a similar designation or regulation under any Environmental
Law or other federal, state or local law (whether under common law, statute,
regulation or otherwise) or judicial or administrative interpretation of such,
including, without limitation, asbestos, petroleum products or by-products
(including, without limitation, crude oil or any fraction thereof), the group of
organic compounds known as polychlorinated biphenyls, radon gas, natural gas,
urea formaldehyde, radioactive materials, toxic, infectious, reactive,
corrosive, ignitable or flammable chemicals and chemicals known to cause cancer
or adverse health effects.
"Premises" means the Trust Property, and all improvements now
or hereafter located thereon, and all rights and interests of RHC therein.
"Remedial Work" means any investigation, site monitoring,
containment, cleanup, removal, restoration or other remedial work of any kind or
nature reasonably necessary under any applicable, local, state or federal law or
regulation, any judicial order, or by any governmental or nongovernmental entity
or person because of, or in connection with, the current or future presence,
suspected presence, release or suspected release of Hazardous Materials in or
into the air, soil, groundwater, surface water or soil vapor at, on, about,
under or within the Premises (or any portion thereof).
3. Representations and Warranties. Except as would not constitute a
Material Adverse Change or except as otherwise set forth on Schedule 1,
Indemnitor represents and warrants that: (1) no Hazardous Material has been
installed, used, generated, manufactured, treated, handled, refined, produced,
processed, stored or disposed of in, on or under the Trust Property, including,
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without limitation, the surface and subsurface waters of the Trust Property,
except in compliance in all material respects with Environmental Laws; (2) no
activity has been undertaken on the Trust Property by Indemnitor, its agents,
employees, contractors, licensees, guests or tenants or to its knowledge any
other Person, which would cause, or has caused, (i) the Trust Property to become
a hazardous waste treatment, storage or disposal facility, as such terms are
defined and classified under any currently effective Environmental Law, (ii) a
release or threatened release of Hazardous Materials on, under, about or from
the Trust Property within the meaning of, or otherwise violate, any currently
effective Environmental Law (except as expressly permitted in writing by a
Governmental Authority), or (iii) the discharge or emission of Hazardous
Materials which would require a permit under any currently effective
Environmental Law that has not been obtained and is in full force and effect;
(3) no conditions caused by Indemnitor, its agents, employees, contractors,
licensees, guests or tenants or, to its knowledge, any other Person, with
respect to the Trust Property cause a violation or support a claim under any
currently effective Environmental Law; (4) to the best of Indemnitor's knowledge
after due inquiry, no underground storage tanks are located on the Trust
Property or have been located on the Trust Property and subsequently removed or
filled; (5) with respect to the Trust Property, Indemnitor has not received any
notice at any time that it (or any of its tenants or guests) is or was claimed
to be in violation of or in non-compliance with the conditions of any currently
effective Environmental Law; and (6) there is not now pending or threatened any
action, judgment, claim, consent decree, judicial or administrative orders or
agreements, or governmental liens with respect to Indemnitor or the Trust
Property relating to any currently effective Environmental Law.
4. Covenants. Indemnitor covenants: (i) that no Hazardous Materials shall
be installed, used, generated, manufactured, treated, handled, refined,
produced, processed, stored or disposed of in, on or under the Trust Property,
except in all material respects in compliance with all applicable rules,
regulations and laws; (ii) that no activity shall be undertaken on the Trust
Property which would cause (A) the Trust Property to become a hazardous waste
treatment, storage or disposal facility, as such terms are defined and
classified under any Environmental Law, (B) a release or threatened release of
Hazardous Materials on, under, about or from the Trust Property within the
meaning of, or otherwise violate, any Environmental Law (except as expressly
permitted in writing by a governmental authority), or (C) the discharge or
emission of Hazardous Materials into any watercourse, body of surface or
subsurface water or wetland, or the discharge into the atmosphere of any
Hazardous Materials, that would require a permit under any Environmental Law and
for which no such permit has been issued; (iii) that no activity shall be
undertaken or permitted to be undertaken by Indemnitor on the Trust Property
which would reasonably be expected to result in a violation under any
Environmental Law; (iv) that soils excavated during construction and groundwater
generated during dewatering activities on the Trust Property shall be handled
and disposed of in compliance with Environmental Laws in all material respects;
(v) that if any Remedial Work is required under any applicable Environmental
Laws because of or in connection with current or future presence, suspected
presence, release or suspected release of a Hazardous Material into the air,
soil, ground water, surface water, or soil vapor on, under or about the Premises
or any portion thereof, Indemnitor shall promptly commence and diligently
prosecute to completion all such Remedial Work; provided that the Remedial Work
shall have been approved by any environmental regulatory agency having
jurisdiction over such work; (vi) all Remedial Work shall be performed by
contractors, and under the supervision of a consulting engineer, each approved
in advance by the Agent and any necessary environmental regulatory agencies and
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all costs and expenses of such Remedial Work and Agent's or its agents' or
representatives' monitoring or review of such Remedial Work (including
reasonable attorneys' fees, charges and disbursements) shall be paid by
Indemnitor; (vii) if Indemnitor does not timely commence and diligently
prosecute to completion the Remedial Work, Agent and its agents and
representatives may (but shall not be obligated to) cause such Remedial Work to
be performed and Indemnitor agrees to bear and shall pay or reimburse Agent (for
the benefit of the Lender Group) on demand for all expenses (including
reasonable attorneys' fees, charges and disbursements) relating to or incurred
by Agent (for the benefit of the Lender Group) and its agents and
representatives in connection with monitoring, reviewing or performing any
Remedial Work; (viii) Indemnitor shall not commence any Remedial Work or enter
into any settlement agreement, consent decree or other compromise relating to
any Hazardous Materials or Environmental Laws which might impair the value of
the Lender Group's security hereunder or under the other Loan Documents, unless
such Remedial Work is required to be performed by an environmental regulatory
agency under applicable law in which case Indemnitor shall use its best efforts
not to impair the value of the Lender Group's security under the Loan Documents;
and (ix) promptly following completion of any remedial actions imposed upon
Indemnitor under any Environmental Law by a governmental agency in response to a
violation of Environmental Laws or any environmental permits, licenses,
approvals or authorizations or a release of Hazardous Materials at or from the
Trust Property, Indemnitor shall obtain and deliver to the Agent (for the
benefit of the Lender Group), either (x) an environmental report in form and
substance reasonably acceptable to the Agent from an environmental consultant
reasonably acceptable to the Agent, stating that all required action has been
taken, and that upon completion of such action, the Trust Property is, to the
knowledge of such professional, then in compliance with applicable Environmental
Laws, or (y) a statement from the governmental agency that required such action
to the effect that all required action has been taken to its satisfaction.
5. Indemnities. Indemnitor hereby agrees to unconditionally indemnify,
defend, and hold Lender Group harmless against: (1) any loss, fines, penalties,
actions, suits, proceedings, liability, damage, expense or claim incurred in
connection with, arising out of, resulting from or incident to the application
of any Environmental Law with respect to the Trust Property; (2) any breach of
any representation or warranty or the inaccuracy of any representation made by
Indemnitor in or pursuant to this Indemnity; (3) any breach of any covenant or
agreement made by Indemnitor in or pursuant to this Indemnity; (4) any liability
or obligation arising out of CERCLA, any equivalent state statute or any other
Environmental Law which may be incurred or asserted against the Lender Group,
directly or indirectly, under Environmental Laws, with respect to the Trust
Property; and (5) any other loss, liability, damage, expense or claim which may
be incurred by or asserted against the Lender Group, directly or indirectly,
resulting from the presence of Hazardous Material on the Trust Property,
including (A) all foreseeable and unforeseeable consequential damages, (B) the
costs of any required or necessary investigation, repair, cleanup, remediation
or detoxification and (C) the costs of the preparation and implementation of any
closure, remedial or other remedial plans. Notwithstanding anything herein to
the contrary, this Indemnity shall not be construed to impose liability on
Indemnitor for Hazardous Materials placed, released or disposed of on the Trust
Property or any obligation or liability under Environmental Law (except to the
extent caused by the acts or omissions of Indemnitor or its agents, employees,
contractors, licensees, guests and tenants) (i) after the date of foreclosure,
assignment (other than an assignment by the Agent to a successor "Agent" under
the Loan Agreement) or sale, (ii) after the acceptance by the Agent (for the
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benefit of the Lender Group) of a deed in lieu of foreclosure, (iii) during any
period during which a receiver appointed upon the request or petition of the
Agent (for the benefit of the Lender Group) is in possession of the Trust
Property or the Agent (for the benefit of the Lender Group) operates the Trust
Property as a mortgagee in possession, or (iv) to the extent such liability
arises from the gross negligence or willful misconduct of the Agent (for the
benefit of the Lender Group) or any indemnitee hereunder.
6. Duration of Indemnity. The duration of Indemnitor's obligations
hereunder shall cease upon (i) payment in full in cash of all Obligations and
the irrevocable termination of all commitments of the Lender Group to extend
credit under the Loan Agreement and/or (ii) the release of the Deed of Trust;
provided, however, that Indemnitor's obligations with respect to Sections 5 and
9 shall not cease until the expiration of the statute of limitations period
applicable to the subject matter of the underlying claim.
7. Notices from Indemnitor. Indemnitor shall, promptly after obtaining
knowledge thereof, advise the Agent (for the benefit of the Lender Group) in
writing of: (i) any governmental or regulatory actions instituted or threatened
in writing under any Environmental Law affecting the Trust Property or this
Indemnity or any requirement by a government or regulatory agency to take
material response action with respect to the presence of Hazardous Materials on
the Trust Property, including, without limitation, any notice of inspection
(other than routine inspections), abatement or noncompliance; (ii) all claims
made or threatened in writing by any third party against Indemnitor or the Trust
Property relating to any Hazardous Material or a violation of an Environmental
Law with respect to the Trust Property; (iii) Indemnitor's discovery of any
occurrence or condition on the Trust Property or any Adjacent Property that
would reasonably be expected to subject Indemnitor or the Trust Property to (A)
a material claim under any Environmental Law or (B) any restriction on
ownership, occupancy, transferability or material change in use of the Trust
Property under any Environmental Law; and (iv) the commencement of any Remedial
Work. Indemnitor shall deliver to the Agent (for the benefit of the Lender
Group) such documentation or records as the Agent may reasonably request and
that are susceptible of being obtained by Indemnitor relating to the Trust
Property in relation to any Environmental Law without undue cost or expense and
without the necessity for initiating legal proceedings to obtain the same.
Agent, for the benefit of the Lender Group, may join and participate in, as a
party if it so determines, any legal or administrative proceeding or action
concerning the Premises under any Environmental Law. Indemnitor agrees to bear
and shall pay or reimburse Agent (for the benefit of the Lender Group) on demand
for all expenses (including reasonable attorneys' fees, charges and
disbursements) relating to or incurred by Agent (for the benefit of the Lender
Group) in connection with any such action or proceeding.
8. Notice of Claims Against Indemnitees. The Agent (for the benefit of
the Lender Group) agrees that it shall provide Indemnitor with written notice of
any claim or demand that the Agent (for the benefit of the Lender Group) has
determined could give rise to a right of indemnification under this Indemnity;
provided that the failure to give any such notice shall not limit Indemnitor's
obligations hereunder. Such notice shall be given a reasonable time after the
Agent (for the benefit of the Lender Group) becomes aware of the relevant facts
and shall specify, to the best of the Agent's knowledge, the facts giving rise
to the alleged claim, and the amount, to the extent determinable, of liability
for which indemnity is asserted. Indemnitor agrees that in any action, suit or
proceeding brought against the Lender Group, the Lender Group may be represented
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by counsel chosen by the Lender Group, without affecting or otherwise impairing
this Indemnity and, to the extent fees and disbursements to such counsel are
reasonably incurred in protecting the Lender Group's interests, to pay such fees
and disbursements. The Agent (for the benefit of the Lender Group) agrees that,
as to any action, suit or proceeding for which Indemnitor has acknowledged in
writing and undertaken its obligation to indemnify, defend and hold the Lender
Group harmless with respect thereto, the Agent (for the benefit of the Lender
Group) will not settle or otherwise compromise any such action, suit or
proceeding without the prior written consent of Indemnitor, which consent shall
not be unreasonably withheld, conditioned, or delayed. If, as to any such
action, suit or proceeding for which Indemnitor has acknowledged in writing and
undertaken its obligation to indemnify, defend and hold the Lender Group
harmless with respect thereto, without obtaining the prior written consent in
writing of Indemnitor, the Agent (for the benefit of the Lender Group)
compromises or otherwise settles such action, suit or proceeding, any such
compromise or settlement without the consent of Indemnitor shall not be binding
upon Indemnitor. Indemnitor agrees that it will not settle or compromise such
action, suit or proceeding without the prior written consent of Agent (for the
benefit of the Lender Group), which consent may be given, conditioned, or
withheld by the Lender Group in its good faith business judgment.
9. Payment of the Agent's Expenses. If after notice of claim under
Section 8 the Agent (for the benefit of the Lender Group) retains counsel for
advice or other representation in connection with (i) any litigation, contest,
dispute, suit or proceeding (whether instituted by the Lender Group, Indemnitor,
or any other party, including any governmental agency charged with enforcement
of any Environmental Law) in any way relating to this Indemnity, or (ii) efforts
initiated in good faith to enforce this Indemnity, then all of the reasonable
attorneys' fees arising from such services and all related expenses and court
costs shall be payable by Indemnitor within thirty (30) days after written
demand.
10. Environmental Inspections. With written notice during regular
business hours (or with such notice and upon such terms as are reasonable in
light of the circumstances), the Agent (and/or its agents, employees and
consultants) may enter the Trust Property to ascertain its environmental
condition and with the reasonable belief that there has been, or could be, a
release or threatened release of Hazardous Materials or a violation of
Environmental Laws, may sample building materials, take soil samples and/or test
borings, and otherwise inspect the Trust Property. The Agent (and/or its agents,
employees and consultants) shall conduct such inspection in a reasonable manner
so as to not unduly disrupt the operation of Indemnitor and its guests and
tenants.
11. Obligations Absolute; Waivers. Except as otherwise provided in
Sections 5, 6, and 8, the obligations of Indemnitor hereunder shall remain in
full force without regard to, and shall not be impaired by the following, any of
which may be taken in such manner, upon such terms and at such times as the
Agent, in accordance with the terms of the Loan Agreement, this Indemnity, any
6
Loan Document, or any other document entered into by Indemnitor in connection
with the foregoing, deems advisable, without the consent of, or notice to,
Indemnitor (except to the extent that it may be entitled to consent or notice,
in its capacity as an Issuer or Subsidiary Guarantor, as applicable), nor shall
any of the following give Indemnitor any recourse or right of action against
Lender Group: (i) any express amendment, modification, renewal, addition,
supplement, extension or acceleration of or to the Obligations or the Loan
Agreement, this Indemnity, any Loan Document, or any other document entered into
by Indemnitor in connection with the foregoing (including, without limitation,
this Indemnity, unless expressly agreed by the parties hereto in writing); (ii)
any exercise or non-exercise by the Lender Group of any right or privilege under
the Loan Agreement, this Indemnity, any Loan Document, or any other document
entered into by Indemnitor in connection with the foregoing; (iii) any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to Indemnitor, or any affiliate of
Indemnitor, or any action taken with respect to this Indemnity by any trustee or
receiver, or by any court, in any such proceeding, whether or not Indemnitor
shall have had notice or knowledge of any of the foregoing; (iv) any release,
waiver or discharge of Indemnitor (other than under this Indemnity) or any
endorser or other guarantor from liability under any of the Loan Agreement, this
Indemnity, any Loan Document, or any other document entered into by Indemnitor
in connection with the foregoing or Indemnitor's grant to the Agent (for the
benefit of the Lender Group) of a security interest, Lien or encumbrance in any
of Indemnitor's property; (v) unless expressly agreed by the parties hereto in
writing, any subordination, compromise, settlement, release (by operation of law
or otherwise), discharge, compound, collection, or liquidation of the Loan
Agreement, this Indemnity (unless expressly agreed to by the parties hereto in
writing), any Loan Document, or any other document entered into by Indemnitor in
connection with the foregoing or any collateral described in the Loan Agreement,
this Indemnity, any Loan Document, or any other document entered into by
Indemnitor in connection with the foregoing or otherwise, or any substitution
with respect thereto; (vi) any assignment or other transfer of the Loan
Agreement, this Indemnity, any other Loan Document, or any other document
entered into by Indemnitor in connection with the foregoing, in whole or in
part; (vii) any acceptance of partial performance of any of the obligations of
Indemnitor under the Loan Agreement, this Indemnity, any other Loan Document, or
any other document entered into by Indemnitor in connection with the foregoing;
(viii) any consent to the transfer of any collateral described in the Loan
Agreement, this Indemnity, any Loan Document, or any other document entered into
by Indemnitor in connection with the foregoing or otherwise; and (ix) any bid or
purchase at any sale of the collateral described in the Loan Agreement, this
Indemnity, any Loan Document, or any other document entered into by Indemnitor
in connection with the foregoing.
Except as otherwise provided in Sections 5, 6, and 8, the Indemnitor
unconditionally waives any defense to the enforcement of this Indemnity,
including, without limitation: (1) all presentments, demands (except as provided
herein and in the Loan Documents), demands for performance, notices of
nonperformance, protests, notices of protest, dishonor, nonpayment, partial
payment or default, notices of acceptance of this Indemnity and all other
notices and formalities to which the Indemnitor may be entitled; (2) any right
to require the Lender Group to proceed against any guarantor or to proceed
against or exhaust any collateral described in the Loan Agreement, this
Indemnity, any Loan Document, or any other document entered into by Indemnitor
in connection with the foregoing or to pursue any other remedy whatsoever; (3)
the defense of any statute of limitations affecting the liability of Indemnitor
hereunder, the liability of Indemnitor or any guarantor under the Loan
Agreement, any Loan Document, or any other document entered into by Indemnitor
in connection with the foregoing, or the enforcement hereof, to the extent
permitted by law; (4) any defense arising by reason of any invalidity or
unenforceability of the Loan Agreement, any Loan Document, or any other document
entered into by Indemnitor in connection with the foregoing or any guarantor or
of the manner in which the Lender Group has exercised its remedies under the
Loan Agreement, this Indemnity, any Loan Document, or any other document entered
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into by Indemnitor in connection with the foregoing; (5) any defense based upon
any election of remedies by the Lender Group, including, without limitation, any
election to proceed by judicial or nonjudicial foreclosure of any security,
whether real property or personal property security, or by deed in lieu thereof,
and whether or not every aspect of any foreclosure sale is commercially
reasonable, or any election of remedies (including, but not limited to, remedies
relating to real property or personal property security) that destroys or
otherwise impairs the rights of Indemnitor to proceed against any other
Indemnitor or any other guarantor for reimbursement, or both; (6) any duty of
the Lender Group to advise Indemnitor of any information known to the Lender
Group regarding the financial condition of any guarantor or of any other
circumstance affecting any guarantor's ability to perform its obligations to the
Lender Group, it being agreed that Indemnitor assumes the responsibility for
being and keeping informed regarding such condition or any such circumstances;
(7) any right of subrogation and any rights to enforce any remedy that the
Lender Group now has or may hereafter have against any guarantor and any benefit
of, and any right to participate in, any security now or hereafter held by the
Lender Group, until all Obligations under the Loan Agreement, this Indemnity,
any Loan Document, or any other document entered into by Indemnitor in
connection with the foregoing have been fully paid and indefeasibly performed;
and (8) to the extent permitted by law, any right to assert against the Lender
Group any legal or equitable defense, counterclaim, set-off or crossclaim that
it may now or at any time or times hereafter have against any other Indemnitor.
12. No Waiver. Indemnitor's obligations hereunder shall in no way be
impaired, reduced or released by reason of the Lender Group's omission or delay
to exercise any right described herein or in connection with any notice (except
for notices required of the Agent (for the benefit of the Lender Group) pursuant
to this Indemnity), demand, warning or claim regarding violations of any
Environmental Laws governing the Trust Property, except as expressly provided in
Section 5 hereof.
13. Recourse.
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(a) Indemnitor agrees that the obligations of Indemnitor
hereunder are separate, independent of and in addition to Indemnitor's
obligations under the Loan Agreement or any other Loan Document.
(b) Indemnitor agrees that a separate action may be brought to
enforce the provisions of this Indemnity, which shall in no way be deemed to be
an action on the Obligations, whether or not the Lender Group would be entitled
to a deficiency judgment following a judicial foreclosure or sale under any Deed
of Trust. Indemnitor waives any right to require that any action be brought by
the Lender Group against Indemnitor or any other Person, or that any other
remedy under the Loan Agreement, this Indemnity, any other Loan Document, or any
other document entered into by Indemnitor in connection with the foregoing be
exercised. The Lender Group may, at its option, proceed against Indemnitor in
the first instance to collect monies when due or to obtain performance under
this Indemnity, without first proceeding against Indemnitor or any other
indemnitor or any other Person and without first resorting to any other
indemnity, the Loan Agreement, this Indemnity, any Loan Document, or any other
document entered into by Indemnitor in connection with the foregoing or any
other remedy under the Loan Agreement, this Indemnity, any Loan Document, or any
8
other document entered into by Indemnitor in connection with the foregoing.
(c) This Indemnity is not given as additional security for the
Obligations and is entirely independent of the Obligations (except as provided
in Section 5), and shall not be measured or affected by any amounts at any time
owing under the other Loan Documents, the sufficiency or insufficiency of any
collateral (including without limitation the Premises) given to the Lender Group
to secure repayment of the Obligations, or the consideration given by the Lender
Group or any other party in order to acquire the Premises or any portion
thereof. None of the obligations of Indemnitor hereunder shall be in any way
secured by the lien of the Deed of Trust or any other Loan Document.
14. Successors and Assigns. Subject to the provisions of Sections 5 and
6, this Indemnity shall be continuing, irrevocable and binding on Indemnitor and
its successors and assigns, and this Indemnity shall be binding upon and shall
inure to the benefit of each member of the Lender Group and its respective
successors and assigns. The death or dissolution of Indemnitor shall not affect
this Indemnity or any of Indemnitor's obligations hereunder. It is agreed by
Indemnitor that its liabilities hereunder are not contingent on the signature of
any other indemnitor under any other indemnity.
15. Notices. All notices, demands and other communications under this
Indemnity shall be given in accordance with Section 12 of the Loan Agreement.
16. Entire Agreement. This Indemnity constitutes the entire agreement
among the parties with respect to the subject matter hereof and supersedes all
prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter contained in this Indemnity.
17. Amendment and Waiver. This Indemnity may not be amended except by
a writing signed by all the parties, nor shall observance of any term of this
may be waived except with the written consent of the Lender Group or the Agent
(for the benefit of the Lender Group).
18. Governing Law. This Indemnity and any claims or disputes relating
thereto shall be governed and construed in accordance with the laws of the State
of CALIFORNIA, without regard to the principles of conflict of laws thereof.
19. Counterparts. This Indemnity may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same agreement.
20. Severability. All provisions contained in this Indemnity are
severable and the invalidity or unenforceability of any provision shall not
affect or impair the validity or enforceability of the remaining provisions of
this Indemnity.
21. Headings. The descriptive headings of the Sections of this
Indemnity are inserted for convenience only and do not constitute a part of this
Indemnity.
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22. Attorney's Fees. If the Lender Group, or someone on its behalf,
retains the services of any attorney in connection with this Agreement,
Indemnitor shall pay the costs and reasonable attorneys' fees thereby incurred.
The Lender Group may employ an attorney of Agent's own choice.
23. Interest. In the event that the Lender Group incurs any
obligations, costs or expenses under this Agreement, Indemnitor shall pay such
costs, obligations and expenses immediately, on demand. If such payment is not
received within twenty (20) days after demand thereof, interest on such amount
shall, after the expiration of such twenty (20) day period, accrue at the rate
of eighteen percent (18%), or the maximum rate permitted by law, whichever is
less, until such amount, plus interest, is paid in full.
24. Jurisdiction and Venue. Agent (for the benefit of the Lender Group)
and Indemnitor irrevocably and unconditionally agrees to submit to the exclusive
jurisdiction of the state courts and United States federal courts sitting in the
County of Los Angeles, State of California for any actions, suits or proceedings
arising out of or relating to this Indemnity. Agent (for the benefit of the
Lender Group) and Indemnitor further irrevocably and unconditionally waive any
objection to the laying of venue of any action, suit or proceeding arising out
of this Indemnity in the state courts and United States federal courts sitting
in the County of Los Angeles, State of California, and hereby further
irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such action, suit or proceeding brought in any such court
has been brought in an inconvenient forum.
25. Waiver of Jury Trial. To the fullest extent permitted by law, Agent
(for the benefit of the Lender Group) and Indemnitor each waives any right to
have a jury participate in resolving any dispute whether sounding in contract,
tort or otherwise arising out of, connected with, related to or incidental to
the relationship established between them in connection with this Indemnity. Any
such disputes shall be resolved in a bench trial without a jury.
[Signature Page Follows]
10
IN WITNESS WHEREOF, this Environmental Indemnity has been executed as
of the date first above written.
AGENT (FOR THE BENEFIT
OF THE LENDER GROUP): FOOTHILL CAPITAL CORPORATION, as Agent
for the Lender Group
By:
----------------------------------------
Name:
Title:
INDEMNITOR: RIVIERA HOLDINGS CORPORATION,
a Nevada corporation
By:
----------------------------------------
Name:
Title:
Signature Page
SCHEDULE 1
Hazardous Materials Disclosure
None.
Schedule 1-1
EXHIBIT A
[Legal Description (Nevada)]
Exhibit A
