EXHIBIT 10.31
Execution Copy
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STOCK PLEDGE AND SECURITY AGREEMENT
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THIS STOCK PLEDGE AND SECURITY AGREEMENT (the "Stock Pledge Agreement"),
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dated as of November 21, 1997, is executed by COAST RESORTS, INC., a Nevada
corporation ("Shareholder"), in favor of FIRSTAR BANK OF MINNESOTA, N.A., as
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trustee ("Trustee") for the holders of those certain $16,800,000 10 7/8% First
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Mortgage Notes due 2001 ("Noteholders"), as security for that certain Guarantee
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(the "Guarantee") set forth in that certain Indenture dated as of November 21,
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1997 (the "Indenture") by and among Trustee, Coast Hotels and Casinos, Inc., a
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Nevada corporation (the "Borrower"), and Shareholder, as guarantor.
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RECITALS
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A. Shareholder owns 100% of the outstanding stock of each of Borrower and
Coast West, Inc., a Nevada corporation ("Coast West").
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B. The Noteholders are willing to purchase $16,800,000 10 7/8% First
Mortgage Notes due 2001 (the "Notes") for the purposes of, among other things,
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providing funds to the Borrower for working capital purposes.
C. Shareholder will derive substantial benefit from the purchase of the
Notes by the Noteholders.
D. It is a condition precedent to purchasing the Notes that (i)
Shareholder pledge 100% of its interest in Coast West to Trustee, and (ii) the
Shareholder agrees to pledge, subject to receipt of required approvals of the
Nevada Gaming Authorities, 100% of its interest in the Borrower for the benefit
of the Noteholders, as security for the Guarantee.
AGREEMENT
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NOW, THEREFORE, in consideration of the above recitals and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Shareholder hereby agrees with Trustee as follows:
1. Definitions and Interpretation. When used in this Stock Pledge
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Agreement, the following terms shall have the following respective
meanings:
"Borrower" means Coast Hotels and Casinos, Inc., a Nevada corporation.
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"Coast West" means Coast West, Inc., a Nevada corporation.
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"Collateral" shall have the meaning given to that term in Section 2
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hereof.
"Obligations" shall mean and include all obligations, howsoever
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arising, owed by Shareholder to the Noteholders of every kind and
description, pursuant to the terms of the Guarantee and the Indenture
(whether or not evidenced by any note or instrument and whether or not
for the payment of money), direct or indirect, absolute or contingent,
due or to become due, now existing or hereafter arising, including
without limitation all interest, fees, charges, expenses, attorneys'
fees and accountants' fees chargeable to Shareholder and payable by
Shareholder hereunder and thereunder.
"Stock" shall mean all shares, options, warrants, interests,
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participations or other equivalents (regardless of how designated) of
or in Borrower and/or Coast West, as applicable, whether voting or
nonvoting, including, without limitation, common stock, preferred
stock, or any other equity ownership interest in Borrower and/or Coast
West, as applicable, subject, however, to the last sentence of Section
2.
"UCC" shall mean the Uniform Commercial Code as the same may, from
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time to time, be in effect in the State of Nevada.
Unless otherwise defined herein, all other capitalized terms used
herein and defined in the Indenture shall have the respective meanings
given to those terms in the Indenture, and all terms defined in the UCC
shall have the respective meanings given to those terms in the UCC. To the
extent the meanings given herein are inconsistent with those given in the
UCC, the meanings given herein shall govern. Shareholder has previously
received a copy of the Indenture.
2. Pledge. Subject to Section 3 hereof, as security for the
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Obligations, Shareholder hereby pledges and assigns to Trustee, for the
equal and ratable benefit of the Noteholders and grants to Trustee, for the
equal and ratable benefit of the Noteholders, a security interest in all
right, title and interests of Shareholder in and to the Stock, whether now
owned or hereafter acquired (collectively, the "Shareholder's Stock"),
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including without limitation the Shareholder's Stock described in Exhibit
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"A" hereto, and all proceeds thereof, including, without limitation,
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dividends and other property received and receivable by Shareholder in
connection with the Shareholder's Stock other than dividends and other
distributions made by Borrower and/or Coast West, as applicable, and
expressly permitted by the Indenture, if any (the Shareholder's Stock and
such proceeds to be referred to herein collectively as the "Collateral").
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Notwithstanding the foregoing, the Collateral, Stock and Shareholder's
Stock shall not include the Stock of Coast West from and at any time after
the date on which the Stock
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is released from the pledge and security interest hereunder pursuant to
Section 10.3 of the Indenture (the "Release Provision").
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3. Condition Precedent. The pledge of the Stock of the Borrower
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provided for in Section 2 hereof shall be of no force and effect until such
time as such pledge shall have been approved by the Nevada Gaming
Authorities. The pledge of the Stock of the Borrower shall become
effective immediately upon the approval of such pledge by the Nevada Gaming
Authorities.
4. Representations and Warranties. Shareholder represents and
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warrants to Trustee, for the benefit of the Noteholders, that: (a) the
execution, delivery and performance by Shareholder of this Stock Pledge
Agreement are within the power of Shareholder and have been duly authorized
by all necessary actions on the part of Shareholder; (b) this Stock Pledge
Agreement has been duly executed and delivered by Shareholder and
constitutes a legal, valid and binding obligation of Shareholder,
enforceable against it in accordance with its terms, except as limited by
bankruptcy, insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and general
principles of equity; (c) the execution, delivery and performance of this
Stock Pledge Agreement do not (i) violate any requirement of law,
regulation or statute, (ii) violate any provision of, or result in the
breach or the acceleration of or entitle any Person to accelerate (whether
after the giving of notice or lapse of time or both) any material
obligation under, any indenture, mortgage, lien, lease, agreement, license,
instrument, guaranty, or other document to which Shareholder is a party or
by which Shareholder or its property is bound, or (iii) result in the
creation or imposition of any lien upon any property, material asset or
revenue of Shareholder (except such liens as may be created in favor of
Trustee, for the benefit of the Noteholders, pursuant to this Stock Pledge
Agreement); (d) no consent, approval, order or authorization of, or
registration, declaration or filing with, any governmental authority or
other Person (including, without limitation, the shareholders of any
Person) is required in connection with the execution, delivery and
performance by the Shareholder of this Stock Pledge Agreement, except such
consents, approvals, orders, authorizations, registrations, declarations
and filings that are so required and which have been obtained and are in
full force and effect; (e) Shareholder is the beneficial and, in the case
of capital stock, record owner of the Collateral (or, in the case of after-
acquired Collateral, at the time Shareholder acquires rights in the
Collateral, will be the beneficial and, in the case of capital stock,
record owner thereof) and no other Person has (or, in the case of after-
acquired Collateral, at the time Shareholder acquires rights therein, will
have) any right, title, claim or interest (by way of lien or otherwise) in,
against or to the Collateral, other than "Permitted Liens" (as such term is
defined in the Indenture); (f) all of the Collateral which are shares of
capital stock are and such future Collateral will be validly issued, fully
paid and nonassessable securities of Borrower and Coast West; (g) the
Collateral includes all of the issued and outstanding shares of capital
stock of Borrower and Coast West; (h) except for the Collateral, there are
no outstanding options, warrants or other rights to
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subscribe for or purchase voting or non-voting capital stock of Borrower or
Coast West, nor any notes, bonds, debentures or other evidences of
indebtedness that (1) are at any time convertible into capital stock of
Borrower or Coast West, or (2) have or at any time would have voting rights
with respect to Borrower or Coast West; (i) upon transfer to Trustee of all
Collateral consisting of securities, Trustee (on behalf of the Noteholders)
will have a first priority perfected security interest in such Collateral,
and (or in the case of all other after-acquired Collateral, at the time
Shareholder acquires rights therein, will have) a first priority perfected
security interest in all other Collateral, other than Permitted Liens; and
(j) Shareholder's principal place of business is 0000 Xxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxxx, Xxxxxx.
5. Covenants. Shareholder hereby agrees: (a) to use its best
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efforts to obtain all required approvals of the Nevada Gaming Authorities
relating to the pledge of the Stock of the Borrower hereunder, and to cause
such pledge to become effective pursuant to Section 3 hereof on or before
May 31, 1998; (b) to provide written notice to the Trustee immediately upon
the receipt of the approvals set forth in clause (a) above, and to furnish
the Trustee with an opinion of counsel in form and substance satisfactory
to the Trustee within 5 days following receipt of such approvals to the
effect that the pledge of stock of the Borrower hereunder complies with the
Gaming Control Act; (c) to perform all acts that may be necessary to
maintain, preserve, protect and perfect the Collateral, the lien granted to
Trustee hereunder and the first priority of such lien, subject only to
Permitted Liens; (d) to promptly deliver to Trustee all originals of
certificates and other documents, instruments and agreements evidencing the
Collateral which are now held or hereafter received by Shareholder,
together with such blank stock powers executed by Shareholder as Trustee
may request or, if required under the 1996 Notes Indenture to be delivered
to the 1996 Notes Trustee, or if in the possession of the 1996 Notes
Trustee, to provide appropriate notice to the 1996 Notes Trustee or take
any such other actions as are required to perfect the Trustee's security
interest in the Collateral; (e) to procure, execute and deliver from time
to time any endorsements, assignments, financing statements and other
documents, instruments and agreements and take other actions deemed
necessary, as Trustee may request, to perfect, maintain and protect its
lien hereunder and the priority thereof; (f) to appear in and defend any
action or proceeding which may affect its title to or Trustee's interest in
the Collateral; (g) to keep the Collateral free of all liens except those
created hereunder and the Permitted Liens; (h) not to vote to enable, or
take any other action to permit, Borrower or Coast West to issue any Stock
except as expressly permitted by the Indenture; (i) to pay, and to save
Trustee and the Noteholders harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamps,
excise, sales or other similar taxes which may be payable or determined to
be payable with respect to any of the Collateral or in connection with any
of the transactions contemplated by this Stock Pledge Agreement; and (j)
not to, without the written consent of the Trustee pursuant to or otherwise
expressly permitted by the Indenture, sell, dispose of or transfer
(directly or indirectly) or covenant to sell, dispose of or transfer
(directly or indirectly) the Collateral.
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6. Dividends and Voting Rights Prior to Default. Until an Event of
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Default (as defined in the Indenture) shall have occurred and be continuing
and Trustee shall have given notice to Shareholder of Trustee's intent to
exercise its rights pursuant to Subparagraph 7(b) below, Shareholder shall
be permitted (a) to receive all dividends paid on Shareholder's Stock
(other than dividends paid in additional Stock unless such additional Stock
is pledged to Trustee, for the benefit of the Noteholders, pursuant to this
Stock Pledge Agreement which are expressly permitted by the Indenture and
(b) to exercise all voting and corporate rights with respect to the Stock;
provided, however, that no vote shall be cast or corporate right exercised
or other action taken which would be reasonably likely to impair the
Collateral or be inconsistent with or result in any violation of any
provision of the Indenture.
7. Default and Remedies.
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(a) Event of Default. The occurrence (whether as a result of
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acts or omissions by Borrower, Coast West or any other Person) of an
Event of Default under the Indenture (subject to such cure rights as
may be expressly set forth in such Indenture), whatever the reason for
such Event of Default and whether it shall be voluntary or involuntary
or be effected by operation of law or pursuant to any judgment, decree
or order of any court or any order, rule or regulation of any
administrative or governmental body, shall constitute an "Event of
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Default" hereunder.
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(b) Dividends and Voting Rights. Upon the occurrence and
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during the continuance of any Event of Default hereunder, Trustee may,
upon notice to Shareholder and subject to the terms of the 1996 Notes
Intercreditor Agreement and subject to any approval of the Nevada
Gaming Authorities as may be required, (i) notify Borrower and Coast
West to pay all dividends on Shareholder's Stock to Trustee, for the
benefit of the Noteholders, receive and collect all such dividends and
make application thereof to the obligations in such order as Trustee
may determine, and (ii) register all of Shareholder's Stock in the
name of Trustee or its nominee, for the benefit of the Noteholders,
and Trustee or its nominee may thereafter exercise (A) all voting,
corporate and other rights pertaining to Shareholder's Stock at any
meeting of shareholders of Borrower or Coast West or otherwise and (B)
any and all rights of conversion, exchange, subscription and any other
rights, privileges or options pertaining to Shareholder's Stock as if
it were the absolute owner thereof (including, without limitation,
after Trustee has commenced to exercise remedies (or such remedies are
deemed commenced) under the Indenture, the right to exchange at its
discretion any and all of Shareholder's Stock upon the merger,
consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of Borrower or Coast West, or upon
the exercise by Shareholder or Trustee of any right, privilege or
option pertaining to Shareholder's Stock, and
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in connection therewith, the right to deposit and deliver any and all
of Shareholder's Stock with any committee, depositary, transfer agent,
registrar or other designated agency upon such terms and conditions as
it may determine), all without liability except to account for
property actually received by it, but Trustee shall have no duty to
Shareholder to exercise any such right, privilege or option and shall
not be responsible for any failure to do so or delay in so doing.
Promptly after the waiver or cure of the Event of Default giving rise
to Trustee's election under this Paragraph 7(b), Trustee shall notify
Shareholder, Borrower and Coast West of such waiver or cure and for so
long as no subsequent continuing Event of Default exists, Shareholder
shall have all rights as a shareholder it had prior to the occurrence
of such Event of Default, the Shareholder's Stock shall again be
registered in the name of Shareholder and Borrower and Coast West
shall again make all payments and distributions with respect to
Shareholder's Stock to Shareholder.
(c) Additional Remedies. Subject to the terms of the
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Indenture, upon the occurrence and during the continuance of an Event
of Default, Trustee may exercise, in addition to all other rights and
remedies granted in this Stock Pledge Agreement and in any other
instrument or agreement securing, evidencing or relating to the
Obligations, any and all rights and remedies at law, including,
without limitation, all rights and remedies of a secured party under
the UCC. Without limiting the generality of the foregoing, Trustee
may, subject to the terms of the 1996 Notes Intercreditor Agreement,
without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind to or upon Shareholder, Borrower,
Coast West or any other Person (except notice of time and place of
sale and any other notice required by law and any notice referred to
below or in the Indenture) forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith
sell, assign, give option or options to purchase or otherwise dispose
of and deliver the Collateral or any part thereof (or contract to do
any of the foregoing), in one or more parcels at public or private
sale or sales, in the over-the-counter market, at any exchange,
broker's board or office of Trustee or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem
commercially reasonable, for cash or on credit or for future delivery
without assumption of any credit risk. Trustee shall have the right
upon any such public sale or sales, and, to the extent permitted by
law, upon any such private sale or sales, to purchase the whole or any
part of the Collateral so sold, free of any right or equity of
redemption in Shareholder, which right or equity is hereby waived and
released. Trustee shall apply any proceeds from time to time held by
it and the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or
incidental to the care or safekeeping of any of the Collateral or in
any way relating to the Collateral or the rights of Trustee hereunder,
including, without
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limitation, reasonable attorneys' fees and disbursements of counsel to
Trustee, to the payment in whole or in part of the Obligations, in
such order as specified by the Indenture, and only after such
application and after the payment by Trustee of any other amount
required by any provision of law, need Trustee account for the
surplus, if any, to Shareholder. To the extent permitted by applicable
law, Shareholder waives all claims, damages and demands it may acquire
against Trustee arising out of the exercise by it of any rights
hereunder except as may arise solely from Trustee's gross negligence
or willful misconduct. If any notice of a proposed sale or other
disposition of Collateral shall be required by law, such notice shall
be deemed reasonable and proper if given at least 5 business days
before such sale or other disposition. Shareholder further waives and
agrees not to assert any rights or privileges which it may acquire
under paragraphs (a) through (e) of Section 9112 of the UCC.
(d) No Consents Required. The Trustee may take any action or
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exercise any rights with respect to the Collateral pursuant to clauses
(b) or (c) of this Section 7, and each of the Shareholder, the
Borrower and Coast West agrees that it will comply with instructions
originated by the Trustee with respect to the taking of such action or
exercise of such rights without further consent by the Shareholder,
the Borrower or Coast West.
8. Authorized Actions. Shareholder acknowledges that the
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Obligations hereunder may be supplemented, augmented and otherwise
increased as a result of changes in the underlying obligations of Borrower
guaranteed pursuant to the Guarantee. In that regard, Shareholder
authorizes Trustee, in its discretion, without notice to Shareholder,
irrespective of any change in the financial condition of Borrower, Coast
West or Shareholder since the date hereof, and without affecting or
impairing in any way the liability of Shareholder hereunder, from time to
time to (a) create new Obligations, and, either before or after receipt of
notice of revocation, renew, compromise, extend, accelerate or otherwise
change the time for payment or performance of, or otherwise change the
terms of the Obligations or any part thereof, including increase or
decrease of the rate of interest thereon; (b) take and hold additional
security for the payment or performance of the Obligations and exchange,
enforce, waive or release any such additional security; (c) apply such
additional security and direct the order or manner of sale thereof; (d)
purchase such additional security at public or private sale; (e) upon the
occurrence and during the continuance of an Event of Default, make any
payments and do any other acts Trustee shall deem necessary to protect the
Noteholders' security interest in the Collateral, including, without
limitation, pay, purchase, contest or compromise any encumbrance, charge or
lien (other than a Permitted Lien) which in the judgment of Trustee appears
to be prior to or superior to the security interest granted hereunder, and
appear in and defend any action or proceeding purporting to affect its
security interest in and/or the value of the Collateral, and in exercising
any such powers or authority, pay all expenses incurred in connection
therewith, including reasonable attorneys' fees, and Shareholder hereby
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agrees it shall be bound by any such payment made or act taken by Trustee
hereunder and shall reimburse Trustee for all reasonable payments made and
expenses incurred, which amounts shall be secured under this Stock Pledge
Agreement; provided, however, that Trustee shall have no obligation to make
any of the foregoing payments or perform any of the foregoing acts; (f)
otherwise exercise any right or remedy it may have against Borrower, Coast
West, Shareholder or any security, including, without limitation, the right
to foreclose upon any such security by judicial or nonjudicial sale; (g)
settle, compromise with, release or substitute any one or more makers,
endorsers or guarantors of the Obligations or underlying obligations of
Borrower; and (h) assign the Obligations, the underlying Obligations of
Borrower or this Stock Pledge Agreement in whole or in part (subject to the
terms and conditions of the Indenture).
9. Waivers. Shareholder waives (a) any right to require Trustee or
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the Noteholders to (i) proceed against Borrower or Coast West, (ii) proceed
against or exhaust any security received from Borrower or Coast West or
(iii) pursue any other remedy in Trustee's power whatsoever; (b) any
defense resulting from the absence, impairment or loss of any right of
reimbursement or subrogation or other right or remedy of Shareholder
against Borrower or Coast West, or any security, whether resulting from an
election by Trustee to foreclose upon security by nonjudicial sale, or
otherwise; (c) any set off or counterclaim of Borrower or Coast West or any
defense which results from any disability or other defense of Borrower or
Coast West or the cessation or stay of enforcement from any cause
whatsoever of the liability of Borrower or Coast West; (d) any right to
exoneration of sureties which would otherwise be applicable; (e) except to
the extent prohibited by NRS 40.495, any right of subrogation or
reimbursement and any right of contribution, and right to enforce any
remedy which Trustee now has or may hereafter have against Borrower or
Coast West, and any benefit of, and any right to participate in, any
security now or hereafter received by Trustee until the Obligations and the
underlying obligations of Borrower have been paid in full; (f) all
presentments, demands for performance, notices of nonperformance, protests,
notice of dishonor, and notices of acceptance of the Stock Pledge Agreement
and of the existence, creation or incurrence of new or additional
Obligations; (g) the benefit of any statute of limitations (to the extent
permitted by law) and (h) any right to be informed by Trustee of the
financial condition of Borrower or Coast West or any change therein or any
other circumstances bearing upon the risk of nonpayment or nonperformance
of the Obligations or the underlying obligations of Borrower. Shareholder
has the ability and assumes the responsibility for keeping informed of the
financial condition of Borrower and Coast West and of other circumstances
affecting such nonpayment and nonperformance risks.
10. Limitation on Duties Regarding Collateral. Trustee's sole duty
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with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the UCC or otherwise,
shall be to deal with it in the same manner as Trustee deals with similar
securities and property for its own account and as would be dealt by a
prudent person in the reasonable administration of its
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affairs. Neither Trustee nor any of its directors, officers, employees or
agents shall be liable for failure to demand, collect or realize upon any
of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request
of Shareholder or otherwise.
11. Nevada Gaming Law. This agreement will be governed by the
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Gaming Control Act. Without limiting the generality of the foregoing, the
parties agree that:
(a) Notwithstanding approval by the Nevada Gaming Authorities
pursuant to paragraph 5, other approvals of the Gaming Authorities
may, and in some cases will, be required before certain transactions
relating to this Agreement may occur, including but not limited to the
following:
(i) any re-registration or action similar to re-
registration of the Stock (or any distribution in respect of, in
addition to, in substitution of, or in exchange for, the Stock or
any part thereof);
(ii) any foreclosure, sale, transfer or other disposition
of the Stock; and
(iii) pursuant to Regulation 8.050 of the Nevada Gaming
Commission, the payment or receipt of any money or other thing of
value constituting any part of the consideration for the transfer
or acquisition of the Stock, except that such consideration may
be placed in escrow pending the necessary approvals; and
(b) In the event that the Trustee takes possession of the Stock
of Borrower or Coast West, the Trustee shall retain all evidence of
ownership in the Stock of Borrower and if required, Coast West, or any
distribution of additional securities in respect of, in addition to,
in substitution of, or in exchange for, such Stock of Borrower and, if
required, Coast West, or any part thereof, in the State of Nevada
through its agent, Bank of America Nevada, N.A., or such substitute
agent as it may select in its reasonable discretion that is located in
and authorized to do business in the State of Nevada.
12. Termination. This Stock Pledge Agreement shall terminate upon
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the satisfaction of all Obligations and underlying obligations of Borrower,
and Trustee shall promptly thereafter deliver the Stock certificates held
by it hereunder to Shareholder and, at Shareholder's expense, execute and
deliver to Shareholder such documents as Shareholder shall reasonably
request to evidence such termination. Upon any release of the Stock of
Coast West from the pledge and security interest hereunder pursuant to the
Release Provision, the Trustee shall promptly deliver to Shareholder all
certificates representing such Stock and, at Shareholder's expense, execute
and deliver to Shareholder such documents as Shareholder shall reasonably
request to evidence such
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release.
13. Power of Attorney. Shareholder hereby appoints and constitutes
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Trustee as Shareholder's attorney-in-fact for purposes of, at any time
while an Event of Default exists, (a) collecting any Collateral, (b)
conveying any item of Collateral to any purchaser thereof, and (c) making
any payments or taking any acts under Section 6 hereof. Trustee's
authority hereunder shall include, without limitation, upon the occurrence
and during the continuance of an Event of Default, the authority to endorse
and negotiate, for Trustee's own account, any checks or instruments in the
name of Trustee, to execute or receipt for any document, to transfer title
to any item of Collateral, and to take any other actions necessary or
incident to the powers granted to Trustee in this Stock Pledge Agreement.
This power of attorney is coupled with an interest and is irrevocable by
Shareholder.
14. Miscellaneous.
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(a) Notices. Except as otherwise provided herein, all notices,
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requests, demands of other communications to or upon the parties
hereto shall be addressed to the parties at the respective addresses
indicated below or at such other address as either party hereto may
designate by written notice to the other party, and shall be deemed to
have been given (i) in the case of notice by letter, three (3) days
after deposited in the mails registered and return receipt requested,
or (ii) in the case of notice given by telecommunication, when sent:
Trustee: Firstar Bank of Minnesota, N.A.
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000 Xxxx 0xx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attn: Xxxxx Xxxxxx, III
FAX: 000-000-0000
With a copy to:
National Trust and Savings Association
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxx Xxxxxx
Shareholder: Coast Resorts, Inc.
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0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxxxxx Xxxxxxx
Ph: (000) 000-0000
Fax: (000) 000-0000
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With a copy to:
Xxxxx Xxxxxxxxx, Esq.
General Counsel
Coast Resorts, Inc.
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Ph: (702) 365-7111
Fax: (000) 000-0000
Borrower: Coast Hotels and Casinos, Inc.
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0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxxxxx Xxxxxxx
Ph: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
Xxxxx Xxxxxxxxx, Esq.
General Counsel
Coast Hotels and Casinos, Inc.
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Ph: (702) 365-7111
Fax: (000) 000-0000
Coast West: Coast West, Inc.
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0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxxxxx Xxxxxxx
Ph: (000) 000-0000
FAX: (000) 000-0000
With a copy to:
Xxxxx Xxxxxxxxx, Esq.
General Counsel
Coast Resorts, Inc.
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Ph: (702) 365-7111
Fax: (000) 000-0000
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(b) Nonwaiver. No failure or delay on Trustee's part in
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exercising any right hereunder shall operate as a waiver thereof or of
any other right nor shall any single or partial exercise of any such
right preclude any other further exercise thereof or of any other
right.
(c) Amendments and Waivers. This Stock Pledge Agreement may
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not be amended or modified, nor may any of its terms be waived, except
by written instruments signed by the party or parties against which
enforcement thereof is sought. Each waiver or consent under any
provision hereof shall be effective only in the specific instances for
the purpose for which given.
(d) Assignment. This Stock Pledge Agreement shall be binding
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upon inure to the benefit of Trustee, the Noteholders and Shareholder
and their respective successors and assigns; provided, however, that
Shareholder may not assign its rights or delegate its duties hereunder
without the prior written consent of Trustee. Trustee may assign or
otherwise transfer all or any part of its interest under this Stock
Pledge Agreement, upon notice to Shareholder. Trustee may disclose
this Stock Pledge Agreement and any financial or other information
relating to Shareholder to any potential assignee or participant.
(e) Cumulative Rights, etc. The rights, powers and remedies of
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Trustee under this Stock Pledge Agreement shall be in addition to all
rights, powers and remedies given to Trustee by virtue of the
Indenture, any applicable governmental rule or regulation or any other
agreement, all of which rights, powers, and remedies shall be
cumulative and may be exercised successively or concurrently without
impairing Trustee's lien in the Collateral. Shareholder waives any
right to require Trustee to proceed against any Person or to exhaust
any Collateral or to pursue any remedy in Trustee's power.
(f) Governing Law. This Stock Pledge Agreement shall be
-------------
governed by and construed in accordance with the laws of the State of
New York, except (i) as the Nevada Gaming Control Act may apply, (ii)
as required by mandatory provisions of Nevada law and (iii) to the
extent that the validity or perfection of the lien and security
interest hereunder, or remedies hereunder, in respect of any
particular Collateral are governed by the laws of the State of Nevada.
(g) Intercreditor Agreement. Notwithstanding anything herein
-----------------------
to the contrary, all rights and remedies of the Trustee under this
Agreement are expressly subject to the terms and conditions of the
1996 Notes Intercreditor Agreement.
12
IN WITNESS WHEREOF, Shareholder has caused this Stock Pledge and
Security Agreement to be executed in favor of Trustee as of the day and
year first above written.
SHAREHOLDER:
COAST RESORTS, INC., a Nevada corporation
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President & COO
ACKNOWLEDGMENT AND
CONSENT OF BORROWER AND COAST WEST
----------------------------------
Each of Coast Hotels and Casinos, Inc., a Nevada corporation ("Borrower"),
and Coast West, Inc. ("Coast West") hereby acknowledges receipt of a copy of the
above Stock Pledge and Security Agreement, agrees to be bound by and comply with
the terms thereof, including, without limitation, Section 6 thereof and agrees
to perform all covenants and obligations therein which, by their express or
implied terms are to be performed by Borrower and/or Coast West.
COAST HOTELS AND CASINOS, INC.,
a Nevada corporation
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President & COO
COAST WEST, INC.,
a Nevada corporation
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President & COO
EXHIBIT "A"
-----------
DESCRIPTION OF SHAREHOLDER'S STOCK
----------------------------------
Percentage of
Stock Outstanding
Issuer Class of Stock Certificate No. No. of Shares Shares
------------------- -------------- --------------- ------------- --------------
Coast Hotels and Common No. 1 1,000 100%
Casinos, Inc.
Coast West, Inc. Common No. 1 10 1%
Coast West, Inc. Common No. 2 1,000 99%
