EXHIBIT 10.1
AGREEMENT
This Agreement (the "Agreement"), dated as of October 10, 2000, is entered
into by and among President Casinos, Inc., PRC Holdings Corporation, PRC
Management, Inc., PRCX, Inc., President Riverboat Casino-Philadelphia, Inc.,
P.R.C. Louisiana, Inc., Vegas Vegas, Inc., President Riverboat Casino-New
York, Inc., President Mississippi Charter Corp., President Riverboat Casino-
Missouri, Inc., President Riverboat Casino-Mississippi, Inc., Xxxxxxxxxx
Hotel, Inc., President Riverboat Casino-Iowa, Inc., TCG Blackhawk, Inc.,
President Casino New Yorker, Inc., The Xxxxxxxx Group, L.P., and President
Xxxxxxxxxx Hotel, LLC, (the "Company"), and each of the undersigned holders
(each, a "Consenting Noteholder") of the US $100,000,000 13% Senior Notes, due
September 15, 2001 issued pursuant to that certain indenture dated as of
August 26, 1994 by and between the Company and United States Trust Company of
New York, as trustee (the "13% Notes Indenture" and the "13% Notes Trustee"),
of which US $75,000,000 in principal amount is outstanding (the "13% Notes"),
and holders of the US $25,000,000 12% Notes, due September 15, 2001 issued
pursuant to that certain indenture dated as of December 3, 1998 (the "12%
Indenture" and together with the 13% Notes Indenture, the "Indentures"), by
and between the Company and U.S. Trust Company of Texas, N.A., as trustee
(together with the 13% Notes Trustee, the "Indenture Trustees"), (the "12%
Notes"), (the 13% Notes and the 12% Notes are collectively referred to as the
"Notes").
RECITALS
WHEREAS the Company is in default on the Notes as a result of, among other
things, its failure to make payments due thereunder on March 15, 2000.
WHEREAS the Company and an unofficial committee comprised of certain of the
holders of the Notes (the "Committee") have engaged in good faith negotiations
and reached a mutually acceptable agreement concerning the restructuring of
the Notes (the "Restructuring") on the terms set forth in the term sheet
attached hereto as Exhibit A (the "Term Sheet") and incorporated into this
Agreement as if fully set forth herein.
WHEREAS the Restructuring contemplates a partial payment and restructuring, as
described in the Term Sheet, and is premised upon a sale of the Company's
Xxxxxxxxx Boat at a minimum price (the "Davenport Sale") with certain of the
proceeds to be used to pay interest payments due on the Notes and to purchase
certain of the Notes at par.
WHEREAS the Company and the Consenting Noteholders now desire to implement the
Restructuring and to expedite and ensure implementation of the Restructuring,
the Consenting Noteholders are prepared to commit, on the terms and subject to
the conditions of this Agreement and applicable law, to consent to amendments
to the Indentures and to tender their Notes when solicited to do so, and to
perform their other obligations hereunder.
NOW THEREFORE, in consideration of the foregoing recitals, terms and
conditions set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, each of the
undersigned agrees as follows:
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1. Means for Effecting the Restructuring of the Notes. The Company and the
Consenting Noteholders agree that the Restructuring of the Notes shall occur
by the sale of the Xxxxxxxxx Boat and the deposit of the net proceeds, as
defined in the Term sheet ("Net Proceeds"), in an escrow account until the
closing of the Repurchase (as defined below) or November 30, 2000. The escrow
account shall be pledged as collateral for the Notes and the Net Proceed
applied to the Notes at the earlier of closing of the Repurchase (as defined
below) or November 30, 2000. The Company shall also commence a joint consent
solicitation and tender offer (or redemption without premium, if any) to the
Noteholders to waive certain defaults, to amend the Indentures, to pay missed
interest payments and to purchase Notes, as set forth in the Term Sheet (the
"Repurchase"). The receipt of consents and waivers by holders of at least 98%
in aggregate principal amount of the 13% Notes will be a condition precedent
to the consummation of the Repurchase.
2. Preparation of Restructuring Documents. Promptly upon execution of this
Agreement, the Company shall instruct its counsel to prepare for the review
and approval of the parties hereto all documents needed to effectuate the
Restructuring as contemplated in this Agreement (collectively, the
"Restructuring Documents"). The Company and the Committee shall coordinate
with one another in the preparation of the Restructuring Documents and in the
negotiation and documentation of the Xxxxxxxxx Sale. In addition, the
restructuring of the Company's indebtedness with Xxxxxx Brothers Holdings,
Inc., shall be in form and substance acceptable to the Consenting Noteholders.
The parties shall abide by the time restrictions set forth in the Term Sheet
and in paragraph 3.
3. Timetable. The solicitation of the Repurchase shall commence before the
close of the Xxxxxxxxx Sale. Within 5 business days of the regulatory
approval of the Xxxxxxxxx Sale, the Xxxxxxxxx Sale shall close, and the
Repurchase shall close as soon as reasonably practicable thereafter; provided,
however, that the Xxxxxxxxx Sale and the Repurchase close prior to November
30, 2000. As set forth in the Term Sheet, the Company shall sell the New
Yorker prior to December 31, 2000 and promptly apply any net proceeds to
repurchase the 12% Notes at par. If (i) the Repurchase does not close by
November 30, 2000, (ii) the Company receives the requisite votes to consummate
the Restructuring under a chapter 11 plan of reorganization, (iii) the
Noteholders have received the Net Proceeds, and (iv) this Agreement is not
otherwise terminated, the Company shall have until May 30, 2001 to cause the
Restructuring to close and become effective pursuant to a final order, of a
bankruptcy court with competent jurisdiction over the Company and its assets,
confirming a chapter 11 plan of reorganization that reflects the Term Sheet
for the Company, provided, from and after November 30, 2000, the Company is
taking all reasonable action, determined by the Noteholders in their sole
discretion, to obtain confirmation of a chapter 11 plan of reorganization,
that reflects the Term Sheet and implements the Restructuring by May 30, 2001.
The timetable dates in this paragraph and in the Term Sheet may be extended by
Consenting Noteholders holding two thirds in aggregate principal amount of the
Notes held by all Consenting Noteholders.
4. Support of the Restructuring. Subject to the provisions of Paragraph 6
below, the Consenting Noteholders shall consent to waivers and amendments to
the Indentures, tender their Notes and approve any other action or document
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necessary to implement the Restructuring. Subject to the provisions of
Paragraph 6 below, the Company and each of the Consenting Noteholders shall
not: (a) object to the Restructuring or otherwise commence any proceeding to
oppose the Restructuring or any of the Restructuring Documents so long as the
Company and the Consenting Noteholders have agreed on the form of the
Restructuring and the Restructuring Documents contain terms and conditions
consistent with those contained in this Agreement; (b) vote for, consent to,
support or participate in the formulation of any other out-of-court
restructuring, or a plan of reorganization or liquidation under applicable
bankruptcy or insolvency laws, in respect of the Company; (c) directly or
indirectly seek, solicit, support or encourage any other out-of-court
restructuring, plan, proposal or offer of dissolution, winding up,
liquidation, reorganization, merger or restructuring of the Company (other
than one agreed to in writing by the Company and the Consenting Noteholders)
that is inconsistent with this Agreement; (d) take any other action, including
but not limited to initiating any legal proceedings that is inconsistent with,
or that would delay consummation of the Restructuring.
5. Acknowledgment. This Agreement and the terms of the Restructuring are the
product of negotiations between the Company and the Committee. This Agreement
is not and shall not be deemed to be a solicitation for consents to waivers
and amendments to the Indentures or a solicitation to tender the Notes.
Acceptance of the Restructuring will not be solicited from any holder of the
Notes until it has received the disclosures required under applicable law.
Notwithstanding anything contained herein, the Consenting Noteholders shall be
under no requirement to consent to waivers and amendments to the Indentures or
to tender their Notes, if the Restructuring Documents presented to the
Consenting Noteholders provide for any terms that are materially inconsistent
with this Agreement.
6. Termination of the Consenting Noteholders' Obligations. Each of the
Consenting Noteholders may terminate its obligations hereunder and rescind its
acceptance of the Restructuring by giving written notice thereof to the other
Consenting Noteholders and the Company, if any of the following occur (each, a
"Noteholders Termination Event"): (a) the Restructuring Documents provide or
are modified to provide for any terms that are adverse to or materially
inconsistent with any of the terms or conditions of this Agreement; (b) the
Xxxxxxxxx Sale, the sale of the New Yorker, the Restructuring and other
related transactions or events are not completed, closed, fully executed or
approved in accordance with the time restrictions in the Term Sheet and this
Agreement, including but not limited to Paragraphs 1 and 3 of this Agreement;
or (c) the Company materially breaches this Agreement or fails to satisfy any
of the terms or conditions of the Term Sheet. If the Restructuring is not
completed on or before May 30, 2001, this Agreement and the Term Sheet, shall
without notice or other act, automatically terminate.
7. Termination of the Company's Obligations. The Company shall have the
right to terminate this Agreement, by the giving of written notice thereof to
each of the Consenting Noteholders, only in the event of a material breach of
this Agreement by the Consenting Noteholders (a "Company Termination Event").
8. Effects of Termination. Subject to Paragraph 23 hereof, upon the
occurrence of a Noteholders Termination Event or a Company Termination Event,
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in each case resulting in the termination of the Consenting Noteholders'
obligations or the Company's obligations (as the case may be) under the terms
of Paragraph 6 or Paragraph 7 above, this Agreement shall terminate and no
party hereto shall have any continuing liability or obligation to pay any
other party thereunder; provided, however, that no such termination shall
relieve any party from liability for its breach or non-performance of its
obligations hereunder prior to the date of such termination.
9. Forbearance; Restrictions on Transfers. So long as obligations of the
Consenting Noteholders have not been terminated: (a) the Consenting
Noteholders will (i) not file a notice of default or sale or take any other
action to collect on the Notes or foreclose on any collateral therefor,
including, without limitation, instructing the Indenture Trustees on how to
proceed in the exercise of any and all remedies, or (ii) give instructions to
the Indenture Trustees, if and when reasonably appropriate, to desist from
taking action that is inconsistent with this Agreement or the Restructuring;
and (b) each of the Consenting Noteholders will not, directly or indirectly,
sell, assign, transfer, hypothecate or otherwise dispose of (i) any Notes
beneficially owned by it or as to which it has investment authority or
discretion (including Notes acquired after the date hereof), (ii) any claim
(as that term is defined in section 101(5) of the Bankruptcy Code) arising
from, based on or related to the Notes, or (iii) any option, interest in, or
right to acquire any Notes or claim referred to in clauses (i) and (ii) above,
unless the transferee is (x) an "accredited investor" within the meaning of
Rule 501 under the Securities Act of 1933, as amended, and (y) agrees in
writing to be bound by the terms of this Agreement.
10. The Company's Undertakings. So long as this Agreement is in effect,
absent the prior written consent of the Consenting Noteholders, the Company
shall not take any action materially inconsistent with the Agreement. If
required, the Company shall take all reasonable steps necessary and desirable
to obtain approval for the Repurchase expeditiously as possible under
applicable law, and use reasonable best efforts to obtain any and all
requisite regulatory and/or third party approvals for the Xxxxxxxxx Sale and
the Restructuring.
11. Fees and Expenses. Upon the execution of this Agreement by the
Consenting Noteholders, the Company shall, notwithstanding any agreement to
the contrary, pay in full the fees and costs of the professionals of the
Committee, and shall timely pay in the ordinary course of business any
additional bills submitted to the Company by such professionals through
consummation of the Restructuring. In addition, if any party brings an action
against any other party based upon a breach by such other party of its
obligations hereunder, the prevailing party shall be entitled to all
reasonable expenses incurred, including reasonable attorneys', accountants'
and financial advisors' fees in connection with such action.
12. Notices. Notices given under this Agreement shall be to:
For the Committee:
Xxxx X. Xxxxxxx, Esq.
Xxxxxxx X. XxXxxxxx, Esq.
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Milbank, Tweed, Xxxxxx & XxXxxx LLP
000 Xxxxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxx X. Xxxxxxx
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Xxxxxx Xxxxx
MacKay, Xxxxxxx
0 Xxxx 00xx Xxxxxx, 00xxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
For the Company:
Xxxx X. Xxxxxxxxx
President Casinos, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxxx Xxxxxx, Esq.
Xxxxxx X. Xxxxxxx, Xx., Esq.
Xxxxxxxx Xxxxxx LLP
Xxx Xxxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000 or 7067
For the Consenting Noteholders:
At the addresses and telephone numbers set forth on the signature pages.
13. Reservation of Rights. This Agreement and the Restructuring are part of
a proposed settlement of a dispute among the parties hereto. Except as
expressly provided in this Agreement, nothing herein is intended to, or does,
in any manner waive, limit, impair or restrict the ability of each Consenting
Noteholder and each of the Indenture Trustees to protect and preserve its
rights, remedies and interests, including without limitation, its claims
against the Company. Nothing herein shall be deemed an admission of any kind
by the Noteholders. Nothing contained herein effects a modification of the
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Consenting Noteholders' or the Indenture Trustees' rights under the
Indentures, the Notes or other documents and agreements unless and until the
Restructuring becomes effective. If the transactions contemplated herein are
not consummated, or if this Agreement is terminated for any reason, the
parties hereto fully reserve any and all of their rights. Pursuant to Federal
Rule of Evidence 408, any applicable state rules of evidence and any other
applicable law, this Agreement and all negotiations relating thereto shall not
be admissible into evidence in any proceeding other than a proceeding to
enforce its terms.
14. Good Faith Negotiations of Restructuring Documents. The Company and each
of the Consenting Noteholders hereby further covenant and agree to negotiate
the definitive documents relating to the Restructuring, including, without
limitation, the Restructuring Documents, in good faith.
15. Effectiveness; Amendments. This Agreement shall not become effective and
binding on the parties hereto unless and until counterpart signature pages
hereto shall have been executed and delivered by the Company and the
Consenting Noteholders. This Agreement may be executed by one of more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts when taken together shall constitute
one and the same instrument. Except as expressly provided for herein, no
modification, amendment or waiver of any provision of this Agreement or the
Term Sheet shall be effective unless such modification, amendment or waiver is
in writing and signed by each of the parties hereto. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that nothing contained
in this Paragraph shall be deemed to permit sales, assignments or transfers of
the Notes other than in accordance with Paragraph 9.
16. Representations and Warranties. Each Consenting Noteholder represents
and warrants to the Company and each other that it is an accredited investor
and owns the Notes that represent a beneficial interest in the total principal
amount (of record and/or beneficially) set forth next to its name on the
signature pages hereof, or as to which such holder or its Affiliates (as that
term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as
amended, and over whom the Consenting Noteholder exercises sufficient control
to insure enforcement of the provisions of this Agreement) has investment
authority or discretion. Each party hereunder represents and warrants that
the following statements are true, correct and complete as of the date hereof.
(a) Power, Authority and Authorization. Execution, delivery and
performance of this Agreement by such party has been duly authorized by all
necessary corporate action on the part of such party, and the person executing
this Agreement on behalf of such party is duly authorized to do so;
(b) No Conflicts. The execution, delivery and performance of this
Agreement by such party does not and shall not (i) violate any provision of
law, rule or regulation applicable to it or any of its subsidiaries or its
organizational documents or those of any of its subsidiaries or (ii) except to
the extent previously disclosed in writing to the Committee, conflict with,
result in a breach of or constitute (with due notice or lapse of time or both)
a default under any material contractual obligations to which it or any of its
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subsidiaries is a party or under its organizational documents;
(c) Governmental Consents. The execution, delivery and performance by it
of this Agreement do not and shall not require any registration or filing with
consent or approval of, or notice to, or other action to, with or by, any
federal, state or other governmental authority or regulatory body, except such
filing as may be necessary and/or required for disclosure by the Securities
and Exchange Commission; and
(d) Binding Obligation. This Agreement is the legally valid and binding
obligation of each of the undersigned, enforceable against it in accordance
with its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws, both foreign and
domestic, relating to or limiting creditors' rights generally or by equitable
principles relating to enforceability.
17. Disclosure of Individual Holdings. Unless required by applicable law or
regulation, the Company shall not disclose (i) the amount of a Consenting
Noteholder's holdings of Notes, or (ii) the terms of this Agreement, without
the prior written consent of such Consenting Noteholder; and if such
announcement or disclosure is so required by law or regulation, the Company
shall afford the Consenting Noteholders a reasonable opportunity to review and
comment upon any such announcement or disclosure prior to such announcement or
disclosure by the Company. The foregoing shall not prohibit the Company from
disclosing the approximate aggregate holdings of Notes by the Consenting
Noteholders as a group.
18. Entire Agreement. This Agreement, including the Term Sheet and the
Restructuring Documents, constitutes the entire agreement among the parties
pertaining to the subject matter hereof and supersedes all prior agreements
and understandings of the parties in connection therewith.
19. Representation by Counsel. Each party hereto acknowledges that it has
been represented by counsel in connection with this Agreement and the
transactions contemplated by this Agreement. Accordingly any rule of law or
any legal decision that would provide any party hereto with a defense to the
enforcement of the terms of this Agreement against such party shall have no
application and is expressly waived. The provisions of this Agreement shall
be interpreted in a reasonable manner to effect the intent of the parties
hereto.
20. Consideration. Each party hereto acknowledges the receipt and
sufficiency of good and valuable consideration in exchange for its agreement
to undertake its duties and obligations under this Agreement.
21. Governing Law; Jurisdiction. This Agreement is governed by and construed
in accordance with the internal laws of the State of New York, without regard
to any conflicts of law provision that would require the application of the
law of any other jurisdiction. By its execution and delivery of this
Agreement, each of the parties hereto hereby irrevocably and unconditionally
agrees for itself that any legal action, suit or proceeding against it with
respect to any matter under or arising out of or in connection with this
Agreement or for recognition or enforcement of any judgment rendered in any
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such action, suit or proceeding, shall be brought in a federal court of
competent jurisdiction in the Southern District of New York. By execution and
delivery of this Agreement, each of the parties hereto hereby irrevocably
accepts and submits to the nonexclusive jurisdiction of such court, generally
and unconditionally, with respect to any such action, suit or proceeding.
22. Specific Performance. It is understood and agreed by each of the parties
hereto that money damages would not be a sufficient remedy for any breach of
this Agreement by any party (other than a breach by the Company of Paragraph
11 hereof) and each non-breaching party shall be entitled to specific
performance and injunctive or other equitable relief as a remedy of any such
breach.
23. Survival. Notwithstanding the sale of the Notes in accordance with
Paragraph 9 hereof or the termination of the Consenting Noteholders'
obligations hereunder in accordance with Paragraph 6 hereto, the Company's
obligations and agreements set forth in Paragraphs 11 (with respect to
expenses incurred through the date of such termination) and 17 (with respect
to disclosure of certain information) hereof shall survive such termination
and shall continue in full force and effect for the benefit of the Consenting
Noteholders in accordance with the terms hereof.
24. Successors and Assigns. This Agreement is intended to bind and inure to
the benefit of the parties and their respective successors, assigns, heirs,
executors, administrators and representatives. The agreements,
representations and obligations of the Consenting Noteholders under this
Agreement are, in all respects, several and not joint.
25. No Third Party Beneficiaries. Unless expressly stated herein, this
Agreement shall be solely for the benefit of the parties hereto and no other
person or entity.
26. Headings. The headings of the sections, paragraphs and subsections of
this Agreement are inserted for convenience only and shall not affect the
interpretation thereof.
IN WITNESS WHEREOF, each of the parties below have executed a counterpart of
this Agreement, the terms of which shall be effective upon execution by the
Company and the Consenting Noteholders.
Dated: October 10, 2000 PRESIDENT CASINOS, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRC HOLDINGS CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
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Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRC MANAGEMENT, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRCX, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT RIVERBOAT CASINO-
PHILADELPHIA, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
P.R.C. LOUISIANA, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
VEGAS VEGAS, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT RIVERBOAT CASINO-NEW YORK, INC.
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By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT MISSISSIPPI CHARTER CORP.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT RIVERBOAT CASINO-MISSOURI, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT RIVERBOAT CASINO-
MISSISSIPPI, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
XXXXXXXXXX HOTEL, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT RIVERBOAT CASINO-IOWA, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
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TCG BLACKHAWK, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT CASINO NEW YORKER, INC.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
THE XXXXXXXX GROUP, L.P.
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
PRESIDENT XXXXXXXXXX HOTEL, LLC
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
------------------------------------
Title: President and COO
------------------------------------
Dated: October 10, 2000 SUNAMERICA INC.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $7,440,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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Tel: (000) 000-0000
Fax: (000) 000-0000
SUNAMERICA LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $2,100,000
Principal amount of 12% Notes: $13,150,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
ANCHOR NATIONAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $1,000,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
FIRST SUNAMERICA LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $150,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
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000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
SUNAMERICA CBO
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $16,220,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
BANKERS TRUST, TRUSTEE UNDER TRUST
AGREEMENT DATED, 3/31/97, BY AND AMONG
SUNAMERICA LIFE INSURANCE COMPANY AS
GRANTOR, XXXX XXXXX LIFE INSURANCE COMPANY
AS BENEFICIARY, AND BANKERS TRUST COMPANY
AS TRUSTEE
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
Principal amount of 13% Notes: $2,000,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
AIG GLOBAL INVESTMENT CORPORATION
CBO-3 LTD
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Authorized Agent
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Principal amount of 13% Notes: $1,000,000
Notice Contact:
Xxxx X. Xxxxxxx
Director, High Yield Investments
AIG
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Dated: October 10, 2000 THE XXXXX & XXXXXXXXXX MASTER
RETIREMENT TRUST
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
Principal amount of 13% Notes: $403,000
Principal amount of 12% Notes: $202,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
POLICE OFFICERS PENSION OF THE CITY
OF HOUSTON
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
Principal amount of 13% Notes: $335,000
Principal amount of 12% Notes: $179,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
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Fax: (000) 000-0000
THE MAINSTAY FUNDS, ON BEHALF OF ITS HIGH
YIELD CORPORATE BOND FUND SERIES
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
Principal amount of 13% Notes: $21,698,000
Principal amount of 12% Notes: $10,097,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
THE MAINSTAY FUNDS, ON BEHALF OF ITS
STRATEGIC INCOME FUND SERIES
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
Principal amount of 13% Notes: $94,000
Principal amount of 12% Notes: $47,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
MAINSTAY VP SERIES FUND, INC., ON BEHALF
OF ITS HIGH YIELD CORPORATE BOND PORTFOLIO
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
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Principal amount of 13% Notes: $2,348,000
Principal amount of 12% Notes: $1,180,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
VULCAN MATERIALS COMPANY HIGH
YIELD ACCOUNT
By: MACKAY XXXXXXX LLC
Title: Investment Advisor
By: /s/ Xxxxxx X. Nisi
------------------------------
Name: Xxxxxx X. Nisi
Title: General Counsel
Principal amount of 13% Notes: $54,000
Principal amount of 12% Notes: $27,000
Notice Contact:
Xxxxxx Xxxxx
MacKay Xxxxxxx LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
[EXHIBIT Al]
TERM SHEET
Term Sheet
for the restructuring of President Casinos, Inc.'s
13% Senior Notes due September 15, 2001 (the 13% Notes), and
President Casinos, Inc.'s 12% Notes due September 15, 2001
(the 13% Notes and the 12% Notes, collectively, the "Notes")
October 10, 2000
The unofficial noteholders' committee comprised of certain holders of the 13%
Notes and the 12% Notes (the "Committee") would support a restructuring of the
Notes that incorporates, among other things, the terms herein.
This document does not create and is not intended to create a binding and
enforceable contract or commitment, and may not be relied upon by either party
as the basis for a contract by estoppel or otherwise. This term sheet is part
of a proposed settlement of a dispute. Nothing herein is intended to, or
does, in any manner waive, limit, impair or restrict the ability of each
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holder of the Notes (a "Noteholder") and each Trustee under the respective
Indentures governing the Notes, to protect and preserve its rights, remedies
and interests, including without limitation, its claims against President
Casinos, Inc., and its subsidiaries (the "Company"). Nothing herein shall be
deemed an admission of any kind. Nothing contained herein effects a
modification of the Noteholders' or the Trustee's rights under the Indenture,
the Notes or other documents and agreements. Pursuant to Federal Rule of
Evidence 408 and any applicable state rules of evidence, this Agreement and
all negotiations relating thereto shall not be admissible into evidence in any
proceeding other than a proceeding to enforce its terms.
PARTIAL PAYMENT & RESTRUCTURING: The Company sells the President Riverboat in
Davenport, IA (the "Xxxxxxxxx Boat"), and such sale must equal a gross sale
price excluding cash of at least $58.2 million. The net proceeds received by
the Company per the closing statement shall be applied first to pay the two
interest payments due Noteholders on March 15, 2000 and September 15, 2000, an
amount of approximately $2.0 million will be withheld to pay off the remaining
balance on the Biloxi Casino Barge, working capital will be made available to
the Company in an amount not to exceed $2 million and $4.9 million will be
placed in an escrow account (and pledged as collateral for the Notes) to be
applied to the interest payment due Noteholders on March 15, 2001 (the
"Interest Reserve"). The remainder shall be applied to purchase the Notes at
par, on a pro rata basis within the two issuances, as follows: 75% to the
holders of the 13% Notes and 25% to the holders of the 12% Notes. If the sale
of the New Yorker does not close by December 31, 2000 (as provided below), the
funds in the Interest Reserve shall be immediately applied to pay down the
principal on both Notes on a pro rata basis.
Net proceeds is defined as gross sale price (excluding cash) minus the
following:
* All selling expenses
* Investment banker commissions
* Payment to minority 5% partner
* Payoff of Firstar note
*Any net working capital adjustment related to the current assets (excluding
cash) and current liabilities which pertain directly to the Xxxxxxxxx
operations as of the closing date. The Noteholders are entitled to inspect
and review the books of the Company to verify the amount of the net working
capital adjustment. If the buyer does not assume the current liabilities of
the Xxxxxxxxx operations it purchases, the Company shall retain an amount from
the proceeds necessary to pay such current liabilities.
12% NOTES RESTRUCTURING: Noteholders' will extend the maturity of the 12%
Notes to September 15, 2003, if the Company meets an interest coverage ratio
of 1.3 for the 12% and 13% Notes during the first calendar half of 2001 after
accounting for fixed charges as identified on Schedule A hereto.
Noteholders' will agree to extend the September 2000 interest payment to the
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latter of the close of the sale of the Xxxxxxxxx Boat or September 15, 2000.
The Company shall sell the New Yorker by December 31, 2000. The holders of
12% Notes will cause their Trustee to release the lien on the New Yorker to
facilitate the sale. Any net proceeds obtained will be used to repurchase the
12% Notes at par.
All escrow accounts shall also be pledged as collateral for the Notes.
All other terms shall remain the same.
13% NOTES RESTRUCTURING: The 13% Notes Indenture shall be amended to provide
for a sinking fund payment of $15 million due July 31, 2001, in lieu of the
$25,000,000 redemption scheduled for September 15, 2000, assuming the Admiral
is relocated and open and the new slot product is operational by November 30,
2000. For any delay due to river conditions or legislative changes that
delays the relocation or the slot product improvements, July 31, 2001 will be
extended to be 30 days from the month-end of the month that the relocation and
slot improvements actually occur up to and no later than January 31st at the
latest. The sinking fund payment shall be excused if the St. Louis operations
meet a performance test based on EBITDA (earnings before interest, taxes,
depreciation and amortization) for the calendar quarter ending in June 2001
and each quarter thereafter on a rolling basis as set forth in Schedule B
hereto (the "Performance Test"). If at any time the St. Louis operations fail
to meet the Performance Test, the sinking fund payment shall be due and
payable within 30 days of the close of such quarter.
The maturity date on the 13% Notes shall be extended to September 15, 2003, if
the Company meets an interest coverage ratio of 1.3 for the 12% and 13% Notes
during the first calendar half of 2001 after accounting for fixed charges as
identified on Schedule A hereto.
Noteholders' will agree to extend the September 2000 interest payment to the
latter of the close of the sale of the Xxxxxxxxx Boat or September 15, 2000.
To secure the 13% Notes, the Company, including its subsidiaries, shall: (a)
grant a security interest second in priority to the 12% Notes in all assets
securing the 12% Notes; (b) grant a security interest in the Biloxi Casino
Barge of the highest seniority available and prior to any security interest
granted to Xxxxxx but limited to secure a maximum of $4 million; (c) use best
efforts to grant a security interest behind Xxxxxx in the Xxxxxxxxxx Property
in Biloxi, MS; (d) create and perfect a pledge of all Class A interests and
use its best efforts to obtain and perfect a pledge of all Class B interests
in President Xxxxxxxxxx Hotel, LLC; (e) reaffirm or deliver all pledges and
security documents that should have already been pledged or delivered to the
Trustees pursuant to the Indentures and their related security documents; and
(f) use its best efforts to grant a perfected security interest of the highest
seniority available in all of its remaining assets, except for gaming
equipment which would require approvals from the applicable gaming
commissions. In addition all escrow accounts shall be pledged as collateral
for the Notes.
All other terms shall remain the same.
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WARRANTS: The restructuring of the Notes shall include the issuance by the
Company to the Noteholders, on a pro rata basis, warrants to purchase 10% of
the fully diluted, common stock of the Company as of the date of the signing
of this agreement at an exercise price of $2.625 per share.
The warrants will expire on the fifth anniversary of their issuance.
Registration rights will be given to the holders of the warrants to the extent
necessary to confirm free transferability of the common stock after exercise.
The Company shall pay all expenses associated with any registrations.
The stock in which the warrants are exercisable into shall have the same
shareholder rights as all other common stock currently outstanding.
THIRD PARTY DEFAULTS: There shall not exist any pending or existing defaults,
and the Noteholders shall be reasonably satisfied that there will not be
defaults in the future, on any other debt obligation of the Company, including
its subsidiaries.
DUE DILIGENCE: The restructuring is conditioned upon the results of a
financial and legal due diligence review by the Noteholders.
MATERIAL ADVERSE CHANGE: There shall be no material adverse change to the
assets, liabilities or business prospects of the Company or in the ability of
the Company to perform its obligations hereunder.
RESTRUCTURING EXPENSES: The Company will pay all the expenses, including
professional fees and expenses, of the Committee in connection with the
restructuring.
DOCUMENTATION: All the documents necessary or appropriate to facilitate the
restructuring of the Notes and the Company shall be in form and substance
satisfactory to the Committee and its counsel.
SCHEDULE A
The following fixed charges shall be deducted from the funds available to meet
the interest coverage ratio for the Notes:
* corporate overhead, including without limitation legal, professional and
administrative expenses excluding legal fees of Milbank, Long Xxxxxxxx and
Xxxxxxxx Xxxxxx LLP related to the restructuring of the noteholders and the
Xxxxxx debt
* lease payments for the Xxxxxxxxxx Property in Biloxi, MS
* maintenance capital expenditures (excluding capex to move and upgrade the
Admiral)
* net cost after income for the New Yorker boat until sold
* financing payments for the Biloxi Casino Barge if not paid off pursuant to
Xxxxxxxxx sale
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SCHEDULE B
The Performance Test shall be determined as follows:
EBITDA for the St. Louis operations must show at least a 75% rolling
improvement in 2001 over the same period in 2000. For example, for the July
31, 2001 sinking fund payment to be excused, EBITDA for the St. Louis
operations must be at least 75% greater for the period from January 1, 2001 to
June 30, 2001 as compared to the period from January 1, 2000 to June 30, 2000.
The St. Louis operations must continue to improve by at least 75% for the
period from January 1, 2001 to September 30, 2001 as compared to January 1,
2000 to September 30, 2000 and likewise improve 75% in 2001 from the
corresponding periods in 2000, otherwise the sinking fund payment will be due
30 days after the close of the period in which the 75% minimum increase does
not occur. For the 3 month and 6 month periods in calendar 2002, EBITDA for
the St. Louis operations must not decline from the corresponding periods in
2001, otherwise the sinking fund payment will be due 30 days after the period
in which the EBITDA declines.
