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CASINO MAGIC OF LOUISIANA, CORP.
ISSUER
$115,000,000
13% FIRST MORTGAGE NOTES DUE 2003
WITH CONTINGENT INTEREST
JEFFERSON CASINO CORPORATION
GUARANTOR
_________________
INDENTURE
Dated as of August 22, 1996
_________________
FIRST UNION BANK OF CONNECTICUT
TRUSTEE
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CROSS-REFERENCE TABLE*
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
310 (a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 7.10
(b) 7.10
(c) N.A.
311 (a) 7.11
(b) 7.11
(c) N.A.
312 (a) 2.05
(b) 11.03
(c) 11.03
313 (a) 7.06
(b)(1) 10.03
(b)(2) 7.07
(c) 7.06;11.02
(d) 7.06
314 (a) 4.03;11.02
(b) 10.02
(c)(1) 11.04
(c)(2) 11.04
(c)(3) N.A.
(d) 10.03,10.04,10.05
(e) 11.05
(f) N.A.
315 (a) 7.01
(b) 7.05,11.02
(c) 7.01
(d) 7.01
(e) 6.11
316 (a)(last sentence) 2.09
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) N.A.
(b) 6.07
(c) 2.12
317 (a)(1) 6.08
(a)(2) 6.09
(b) 2.04
318 (a) 11.01
(b) N.A.
(c) 11.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions 1
Section 1.02. Other Definitions 20
Section 1.03. Incorporation by Reference of Trust Indenture
Act 21
Section 1.04. Rules of Construction 22
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating 22
Section 2.02. Execution and Authentication 23
Section 2.03. Registrar and Paying Agent 23
Section 2.04. Paying Agent to Hold Money in Trust 24
Section 2.05. Holder Lists 24
Section 2.06. Transfer and Exchange 24
Section 2.07. Replacement Notes 32
Section 2.08. Outstanding Notes 32
Section 2.09. Treasury Notes 33
Section 2.10. Temporary Notes 33
Section 2.11. Cancellation 33
Section 2.12. Defaulted Interest 33
Section 2.13. Exchange Registration 34
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee 34
Section 3.02. Selection of Notes to Be Redeemed 34
Section 3.03. Notice of Redemption 35
Section 3.04. Effect of Notice of Redemption 35
Section 3.05. Deposit of Redemption Price 35
Section 3.06. Notes Redeemed in Part 36
Section 3.07. Optional Redemption 36
Section 3.08. Redemption Pursuant to Gaming Law 37
Section 3.09. Mandatory Redemption 37
Section 3.10. Offer to Purchase by Application of Excess
Proceeds 38
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes 40
Section 4.02. Maintenance of Office or Agency 41
Section 4.03. Reports 41
Section 4.04. Compliance Certificate 42
Section 4.05. Taxes 43
Section 4.06. Stay, Extension and Usury Laws 43
Section 4.07. Restricted Payments 44
Section 4.08. Dividend and Other Payment Restrictions
Affecting Subsidiaries 47
Section 4.09. Incurrence of Indebtedness and Issuance of
Preferred Stock 47
Section 4.10. Asset Sales 49
Section 4.11 Event of Loss 51
Section 4.12. Transactions with Affiliates 52
Section 4.13. Liens 53
Section 4.14. Line of Business 53
Section 4.15. Corporate Existence 53
Section 4.16. Offer to Repurchase Upon Change of Control 53
Section 4.17. Limitation on Issuances and Sales of Capital
Stock of Wholly Owned Subsidiaries 55
Section 4.18. Subsidiary Guarantees. 55
Section 4.19. Maintenance of Insurance 55
Section 4.20. Limitation on Status as Investment Company 57
Section 4.21. Further Assurances 57
Section 4.22. Construction 57
Section 4.23. Limitations on Use of Proceeds 57
Section 4.24. Sale and Leaseback Transactions 58
Section 4.25. Restrictions on Preferred Stock of Subsidiaries 58
Section 4.26. Payments for Consent 58
Section 4.27. Advances to Subsidiaries 58
Section 4.28. Collateral Documents 59
Section 4.29. Restriction on Payment of Management Fees 59
Section 4.30. Limitation on Activities of Jefferson 60
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets 60
Section 5.02. Successor Corporation Substituted 61
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default 62
Section 6.02. Acceleration 65
Section 6.03. Other Remedies 66
Section 6.04. Waiver of Past Defaults 66
Section 6.05. Control by Majority 66
Section 6.06. Limitation on Suits 66
Section 6.07. Rights of Holders of Notes to Receive Payment 67
Section 6.08. Collection Suit by Trustee 67
Section 6.09. Trustee May File Proofs of Claim 67
Section 6.10. Priorities 68
Section 6.11. Undertaking for Costs 69
Section 6.12. Management of Casinos 69
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee 69
Section 7.02. Rights of Trustee 71
Section 7.03. Individual Rights of Trustee 71
Section 7.04. Trustee's Disclaimer 72
Section 7.05. Notice of Defaults 72
Section 7.06. Reports by Trustee to Holders of the Notes 72
Section 7.07. Compensation and Indemnity 73
Section 7.08. Replacement of Trustee 74
Section 7.09. Successor Trustee by Merger, etc 76
Section 7.10. Eligibility; Disqualification 76
Section 7.11. Preferential Collection of Claims Against
Company 76
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or
Covenant Defeasance 76
Section 8.02. Legal Defeasance and Discharge 76
Section 8.03. Covenant Defeasance 77
Section 8.04. Conditions to Legal or Covenant Defeasance 78
Section 8.05. Deposited Money and Government Securities to
be Held in Trust; Other Miscellaneous
Provisions 79
Section 8.06. Repayment to Company 80
Section 8.07. Reinstatement 80
Section 8.08. Note Collateral 81
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes 81
Section 9.02. With Consent of Holders of Notes 82
Section 9.03. Compliance with Trust Indenture Act 84
Section 9.04. Revocation and Effect of Consents 84
Section 9.05. Notation on or Exchange of Notes 84
Section 9.06. Trustee to Sign Amendments, etc 85
ARTICLE 10
COLLATERAL AND SECURITY
Section 10.01. Security 85
Section 10.02. Recording and Opinions 86
Section 10.03. Release of Note Collateral 88
Section 10.04. Protection of the Trust Estate 89
Section 10.05. Certificates of the Company 90
Section 10.06. Certificates of the Trustee 90
Section 10.07. Authorization of Actions to Be Taken by the
Trustee Under the Collateral Documents 90
Section 10.08. Authorization of Receipt of Funds by the
Trustee Under the Collateral Documents 91
Section 10.09. Termination of Security Interest 91
Section 10.10. Cooperation of Trustee 92
Section 10.11. Collateral Agent 92
ARTICLE 11
GUARANTEES
Section 11.01. Guarantees 92
Section 11.02. Execution and Delivery of Guarantees 94
Section 11.03. Limitation of Guarantors' Liability 95
Section 11.04. Guarantors May Consolidate, etc., on Certain
Terms 95
Section 11.05. Releases of Guarantees 96
Section 11.06. "Trustee" to Include Paying Agent 97
ARTICLE 12
SATISFACTION AND DISCHARGE
Section 12.01. Satisfaction and Discharge 97
Section 12.02. Application of Trust Money 98
ARTICLE 13
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls 98
Section 13.02. Notices 99
Section 13.03. Communication by Holders of Notes with Other
Holders of Notes 100
Section 13.04. Certificate and Opinion as to Conditions
Precedent 100
Section 13.05. Statements Required in Certificate or Opinion 100
Section 13.06. Rules by Trustee and Agents 101
Section 13.07. No Personal Liability of Directors,
Officers, Employees and Stockholders 101
Section 13.08. Governing Law 101
Section 13.09. No Adverse Interpretation of Other Agreements 102
Section 13.10. Successors 102
Section 13.11. Severability 102
Section 13.12. Counterpart Originals 102
Section 13.13. Acts of Holders 102
Section 13.14. Legal Holidays 104
Section 13.14. Table of Contents, Headings, etc 104
EXHIBITS
EXHIBIT A Form of Note
EXHIBIT B Form of Guarantee
EXHIBIT C Certificate to be Delivered Upon Exchange or Registration of
Transfer of Notes
EXHIBIT D Form of Supplemental Indenture
EXHIBIT E Form of Subordinated Intercompany Note
EXHIBIT F Mortgage
EXHIBIT G Bossier Riverboat Mortgage
EXHIBIT H Crescent City Riverboat Mortgage
EXHIBIT I Cash Collateral and Disbursement Agreement
EXHIBIT J CM-Louisiana Security Agreement
EXHIBIT K Jefferson Security Agreement
EXHIBIT L Jefferson Stock Pledge and Security Agreement
EXHIBIT M Accounts Pledge Agreement
EXHIBIT N Collateral Assignment
EXHIBIT O Reciprocal Easement Agreement
INDENTURE dated as of August 22, 1996 among Casino Magic of Louisiana,
Corp., a Louisiana corporation (the "Company"), Jefferson Casino Corporation,
a Louisiana corporation ("Jefferson Corp.") as a Guarantor (as defined below),
and First Union Bank of Connecticut, a Connecticut banking corporation as
trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 13% Series A First Mortgage Notes due 2003 With Contingent Interest (the
"Series A Notes") and the 13% Series B First Mortgage Notes due 2003 With
Contingent Interest (the "Series B Notes" and, together with the Series A
Notes, the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01. DEFINITIONS.
"ACCOUNTS PLEDGE AGREEMENT" means that certain Accounts Pledge
Agreement dated as of August 22, 1996 by and among the Company, the
Disbursement Agent and the Trustee as amended or supplemented from time to
time in accordance with the terms of this Indenture and the Collateral.
"ACCRUAL PERIOD" shall have the meaning set forth in paragraph 1 of
the Notes.
"ACQUIRED DEBT" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"ADJUSTED CONSOLIDATED CASH FLOW" means, with respect to the Company
for any period, the Consolidated Cash Flow of the Company for such period plus
an amount equal to the aggregate Management Fees paid or accrued by the
Company for such period, to the extent such Management Fees were deducted in
computing Consolidated Net Income for purposes of computing such Consolidated
Cash Flow.
"ADJUSTED FIXED CHARGE COVERAGE RATIO" means with respect to any
Person for any period, the ratio of the Adjusted Consolidated Cash Flow of
such Person and its Subsidiaries for such period to the Fixed Charges of such
Person and its Subsidiaries for such period (calculated in the same manner as
the Fixed Charge Coverage Ratio is calculated); PROVIDED that the amount of
Contingent Interest on a pro forma basis shall equal the Contingent Interest
accrued and reflected in the financial statements for the last two Semiannual
Periods with respect to which Contingent Interest was accruable or payable or,
if two such Semiannual Periods have not occurred, then the amount accrued and
reflected in the financial statements with respect to the most recently
completed Reference Period beginning after the Commencement Date.
"AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or otherwise;
PROVIDED that beneficial ownership of 10% or more of the voting securities of
a Person shall be deemed to be control.
"AGENT" means any Registrar, Paying Agent or co-registrar.
"ASSET SALE" means, for any Person, (i) the sale, transfer, lease,
conveyance or other disposition (or series thereof) (including, without
limitation, by merger or consolidation or by exchange of assets whether by
operation of law or otherwise or by way of a sale and leaseback) of any assets
of such Person, including, without limitation, assets consisting of Capital
Stock held by such Person) other than a disposition of inventory in the
ordinary course of business; PROVIDED that the sale, lease, conveyance or
other disposition of all or substantially all of the assets of the Company and
its Subsidiaries taken as a whole will be governed by Section 4.16 and/or
Section 5.01 and not by Section 4.10, (ii) the issue or sale by the Company or
any of its Subsidiaries of Equity Interests of any of the Company's
Subsidiaries, in the case of clauses (i) or (ii), for net proceeds of, or with
a fair market value in excess of $250,000 with respect to each disposition or
series of related dispositions and (iii) an Event of Loss with respect to any
assets of the Company or any of its Subsidiaries other than Note Collateral
existing on the date that Casino Magic-Bossier City becomes Operating.
Notwithstanding the foregoing, (i) a transfer of assets by the Company to a
Substantially Owned Subsidiary of the Company or by a Substantially Owned
Subsidiary of the Company to the Company or to another Substantially Owned
Subsidiary of the Company, (ii) an issuance of Equity Interests by a
Substantially Owned Subsidiary of the Company to the Company or to another
Substantially Owned Subsidiary of the Company, (iii) a Restricted Payment that
is permitted by Section 4.07, (iv) the sale of a Restricted Investment and (v)
any Event of Loss with respect to Note Collateral comprising Casino
Magic-Bossier City on the date that it becomes Operating, in each case, will
not be deemed to be an Asset Sale.
"ATTRIBUTABLE DEBT" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP)
of the obligation of the lessee for net rental payments during the remaining
term of the lease included in such sale and leaseback transaction (including
any period for which such lease has been extended or may, at the option of the
lessor, be extended).
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"BOARD OF DIRECTORS" means, as to any Person, the board of directors
of such Person, or any authorized committee thereof or other equivalent
governing body of such Person.
"BOSSIER RIVERBOAT" means that certain riverboat gaming vessel
"Mary's Prize" Official No. 1028011 purchased by the Company pursuant to the
Vessel Purchase Agreement.
"BOSSIER RIVERBOAT MORTGAGE" means that certain First Preferred Ship
Mortgage on the Whole of the Mary's Prize (Bossier Riverboat), dated as of
August 22, 1996, executed by the Company in favor of the Trustee as amended or
supplemented from time to time in accordance with the terms of this Indenture
and the Collateral Documents.
"BUSINESS DAY" means any day other than a Legal Holiday.
"CAPITAL LEASE OBLIGATION" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized on a balance sheet
in accordance with GAAP.
"CAPITAL STOCK" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership,
partnership interests (whether general or limited) and (iv) any other interest
or participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"CASH COLLATERAL ACCOUNTS" means, collectively, the Construction
Disbursement Account, the Completion Reserve Account, the Interest Reserve
Account, the Operating Reserve Account and the Escrow Account.
"CASH COLLATERAL AND DISBURSEMENT AGREEMENT" means the Cash
Collateral and Disbursement Agreement dated as of August 22, 1996 among the
Company, the Trustee and the Disbursement Agent, in connection with Casino
Magic-Bossier City in substantially the form attached hereto as Exhibit I as
amended or supplemented from time to time in accordance with the terms of this
Indenture and the Collateral Documents.
"CASH EQUIVALENTS" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than six months from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of six months or less
from the date of acquisition, bankers' acceptances with maturities not
exceeding six months and overnight bank deposits, in each case with any
domestic commercial bank having capital and surplus in excess of $500 million
and a Xxxxx Bank Watch Rating of "B" or better, (iv) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clauses (ii) and (iii) above entered into with any financial
institution meeting the qualifications specified in clause (iii) above, (v)
commercial paper having one of the two highest ratings obtainable from Xxxxx'x
Investors Service, Inc. or Standard & Poor's Ratings Group and in each case
maturing within six months after the date of acquisition, and (vi) investment
funds investing solely in securities of the types described in clauses (ii),
(iii), (iv) or (v) above.
"CASINO MAGIC" means Casino Magic Corp., a Minnesota corporation.
"CASINO MAGIC-BOSSIER CITY" means the pending project to develop,
construct, equip and open the Casino Magic-Bossier City dockside riverboat
casino, substantially as described in the Offering Memorandum of the Company
dated August 16, 1996, relating to the Series A Notes, which will be located
on an approximately 23-acre site along the Red River in Bossier City,
Louisiana, and which will consist of, among other things, (i) a recently
constructed riverboat which measures 254 feet long and 78 feet wide, and
contains approximately 58,000 square feet of interior space, including 30,000
square feet of gaming space with approximately 1,000 slot machines and 50
table games, (ii) a 37,000 square foot entertainment pavilion, and related
amenities (including a 350-seat buffet restaurant, a gift shop, a bar and
lounge area and a stage area designed to showcase live entertainment,
including dance productions, bands and individual performers with an open
seating area that will accommodate up to 300 people) and (iii) covered parking
for 1,550 cars, and any future developments or improvements in connection
therewith. For purposes of this definition, the phrase "substantially as
described" with respect to any of the numbers herein shall be deemed to have
been satisfied if the actual number is at least 85% of the respective number
listed herein, in each case, with the same overall qualities and amenities as
provided in the Construction Budget and Plans.
"CASINO MAGIC-BOSSIER CITY HOTEL" means the planned future hotel
with at least 325 rooms and related amenities adjacent to Casino Magic-Bossier
City, including without limitation, the real property on which such hotel is
located.
"CHANGE OF CONTROL" means the occurrence of any of the following
events: (a) any "Person" or "group" (as such terms are used in Sections 13(d)
and 14(d) under the Exchange Act) is or becomes the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person
will be deemed to have "beneficial ownership" of all securities that such
Person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time) directly or indirectly of more than 30% of
the total combined voting power of the outstanding Voting Stock of Casino
Magic, if the Permitted Holders (i) beneficially own a lower percentage of the
combined voting power of the outstanding Voting Stock of Casino Magic than
such other Person or group on such date and (ii) do not have the then
effective right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the Board of Directors of Casino Magic;
(b) Casino Magic consolidates with, or merges with or into, another Person or
sells, assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of the assets of Casino Magic and its Subsidiaries taken as
a whole to any Person, or any Person consolidates with, or merges with or
into, Casino Magic, pursuant to a transaction in which the outstanding Voting
Stock of Casino Magic is converted into or exchanged for cash, securities
(other than Voting Stock of Casino Magic) or other property; (c) during any
consecutive two-year period, individuals who at the beginning of such period
constituted the Boards of Directors of Casino Magic and the Company (together
with any new directors whose election by such Board of Directors or whose
nomination for election by the stockholders of Casino Magic or the Company, as
the case may be, was approved by a vote of 66K% of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of Casino Magic or
the Company, as the case may be, then in office; (d) any order, judgment or
decree shall be entered against Casino Magic or the Company decreeing the
dissolution or split up of Casino Magic and such order shall remain
undischarged or unstayed for a period in excess of 60 days; (e) the sale,
assignment, conveyance, transfer, lease or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions,
of all or substantially all of the assets of the Company and its Subsidiaries
taken as a whole to any Person other than Casino Magic or a Wholly Owned
Subsidiary of Casino Magic; or (f) at any time the Company or Jefferson Corp.
ceases to be a Wholly Owned Subsidiary of Jefferson Corp. or Casino Magic,
respectively.
"COLLATERAL ASSIGNMENT" means that certain Collateral Assignment by
and between the Company and the Trustee as amended or supplemented from time
to time in accordance with the terms of this Indenture and the Collateral
Documents.
"COLLATERAL DOCUMENTS" means, collectively, the Mortgage, Bossier
Riverboat Mortgage, the Crescent City Riverboat Mortgage, the Cash Collateral
and Disbursement Agreement, the CM-Louisiana Security Agreement, the Jefferson
Security Agreement, the Jefferson Stock Pledge and Security Agreement, the
Accounts Pledge Agreement, the Collateral Assignment (in each case in the form
attached hereto as Exhibits F, G, H, I, J, K, L, M and N, respectively and as
each may be amended or supplemented from time to time in accordance with the
provisions of this Indenture), Uniform Commercial Code financing statements,
or any other agreements, instruments, documents or filings that evidence, set
forth or limit the Lien of the Trustee in the Note Collateral.
"COMMENCEMENT DATE" means the first day on which Casino
Magic-Bossier City becomes Operating.
"COMPANY" means Casino Magic of Louisiana, Corp., a Louisiana
corporation or any successor to such corporation pursuant to the applicable
provisions of this Indenture.
"COMPLETION RESERVE ACCOUNT" means that certain account to be
maintained by the Disbursement Agent pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $5.0 million
of the proceeds from the sale of the Notes will be deposited.
"CONSOLIDATED CASH FLOW" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus (i) an
amount equal to any extraordinary loss plus any net loss realized in
connection with an Asset Sale (to the extent such losses were deducted in
computing such Consolidated Net Income), plus (ii) provision for taxes based
on income or profits of such Person for such period, to the extent that such
provision for taxes was included in computing such Consolidated Net Income,
plus (iii) Consolidated Interest Expense of such Person for such period, to
the extent that any such expense was deducted in computing such Consolidated
Net Income, plus (iv) depreciation and amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period) of such Person for such period to
the extent that such depreciation or amortization was deducted in computing
such Consolidated Net Income, in each case, on a consolidated basis and
determined in accordance with GAAP, plus (v) preopening expenses, if any,
related to Casino Magic-Bossier City, to the extent that such preopening
expenses were included in computing such Consolidated Net Income.
Notwithstanding the foregoing, the provision for taxes on the income or
profits of, and the depreciation and amortization of, a Subsidiary of the
referent Person shall be added to Consolidated Net Income to compute
Consolidated Cash Flow only to the extent (and in the same proportion) that
the Net Income of such Subsidiary was included in calculating the Consolidated
Net Income of such Person and only if a corresponding amount would be
permitted at the date of determination to be dividended to such Person by such
Subsidiary without prior governmental approval (that has not been obtained),
and without direct or indirect restriction pursuant to the terms of its
charter and all agreements, instruments, judgments, decrees, orders, statutes,
rules and governmental regulations applicable to that Subsidiary or its
stockholders.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person
for any period, without duplication, (i) the consolidated interest expense of
such Person and its Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of
letter of credit or bankers' acceptance financings, and net payments (if any)
pursuant to Hedging Obligations) and (ii) the consolidated interest expense of
such Person and its Subsidiaries that was capitalized during such period, and
(iii) any interest expense on Indebtedness of another Person that is
Guaranteed by such Person or one of its Subsidiaries or secured by a Lien on
assets of such Person or one of its Subsidiaries (whether or not such
Guarantee or Lien is called upon), and (iv) to the extent not included above,
Contingent Interest, whether paid or accrued, to the extent such expense was
deducted in computing Consolidated Net Income.
"CONSOLIDATED NET INCOME" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
PROVIDED that (i) the Net Income (but not loss) of any Person that is not a
Subsidiary or that is accounted for by the equity method of accounting shall
be included only to the extent of the amount of dividends or distributions
paid in cash to the referent Person or a Wholly Owned Subsidiary thereof that
is a Guarantor, (ii) the Net Income of any Subsidiary shall be excluded to the
extent that the declaration or payment of dividends or similar distributions
by that Subsidiary of that Net Income is not at the date of determination
permitted without any prior governmental approval (that has not been obtained)
or, directly or indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary or its stockholders, (iii) the Net
Income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded, and (iv) the
cumulative effect of a change in accounting principles shall be excluded.
"CONSOLIDATED NET WORTH" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common stockholders of
such Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date
with respect to any series of preferred stock (other than Disqualified Stock)
that by its terms is not entitled to the payment of dividends unless such
dividends may be declared and paid only out of net earnings in respect of the
year of such declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock, less (x) all
write-ups (other than write-ups resulting from foreign currency translations
and write-ups of tangible assets of a going concern business made within 12
months after the acquisition of such business) subsequent to the date of this
Indenture in the book value of any asset owned by such Person or a
consolidated Subsidiary of such Person, (y) all investments as of such date in
unconsolidated Subsidiaries and in Persons that are not Subsidiaries (except,
in each case, Permitted Investments), and (z) all unamortized debt discount
and expense and unamortized deferred charges as of such date, all of the
foregoing determined in accordance with GAAP.
"CONSTRUCTION BUDGET" means itemized schedules setting forth on line
item basis all of the costs (including financing costs) estimated to be
incurred in connection with the financing, design, development, construction,
equipping and opening of Casino Magic-Bossier City, as such schedules are
delivered to the Disbursement Agent on the Issue Date and as amended from time
to time in accordance with the terms of the Cash Collateral and Disbursement
Agreement.
"CONSTRUCTION DISBURSEMENT ACCOUNT" means that certain account, to
be maintained by the Disbursement Agent pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $31.7 million
of the proceeds from the sale of the Notes will be deposited.
"CONTINGENT INTEREST" means with respect to any principal amount of
Notes as of any date after the Commencement Date, an amount equal to the
product of (i) 5% of the Company's Adjusted Consolidated Cash Flow for the
Accrual Period last completed times (ii) a fraction, the numerator of which is
the amount of such principal and the denominator of which is $115.0 million.
"CONTINGENT INTEREST ACCRUAL AMOUNT" means, at any time, the total
amount of Contingent Interest accrued and unpaid through and as of such time.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the address of
the Trustee specified in Section 13.02 hereof or such other address as to
which the Trustee may give notice to the Company.
"CRESCENT CITY RIVERBOAT" means the riverboat gaming vessel
"Crescent City Queen," Official Number 1028319, measuring approximately 430
feet by 100 feet with a total area of approximately 88,000 square feet spread
across three decks, owned by the Company on the Issue Date.
"CRESCENT CITY RIVERBOAT MORTGAGE" means that certain First
Preferred Ship Mortgage on the Whole of the Crescent City Queen (Crescent City
Riverboat), dated as of August 22, 1996, executed by the Company in favor of
the Trustee as amended or supplemented from time to time in accordance with
the terms of this Indenture and the Collateral Documents.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"DEFAULT" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"DEFINITIVE NOTES" means Notes that are in the form of the Notes
attached hereto as Exhibit A, that do not include the information called for
by footnote 1 thereof.
"DEPOSITARY" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof
as the Depositary with respect to the Notes, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"DISBURSEMENT AGENT" means First National Bank of Commerce.
"DISQUALIFIED STOCK" means any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable
at the option of the Holder thereof, in whole or in part, on or prior to the
date that is 91 days after the date on which the Notes mature.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"ESCROW ACCOUNT" means that certain account to be maintained by the
Disbursement Agent pursuant to the terms of the Cash Collateral and
Disbursement Agreement into which the proceeds of a sale of the Crescent City
Riverboat, if any, will be deposited if required by the terms of the Cash
Collateral and Disbursement Agreement.
"EVENT OF LOSS" means, with respect to any property or asset
(tangible or intangible, real or personal), any of the following: (i) any
loss, destruction or damage of such property or asset; (ii) any actual
condemnation, seizure or taking by exercise of the power of eminent domain or
otherwise of such property or asset, or confiscation of such property or asset
or the requisition of the use of such property or asset; or (iii) any
settlement in lieu of clause (ii) above or with respect to the institution of
any proceedings for any such condemnation, seizure, taking, confiscation or
requisition.
"EXCESS CASH FLOW" means, with respect to the Company for any
Reference Period, the Consolidated Cash Flow of the Company and its
Subsidiaries for such Reference Period, minus (i) provision for taxes based on
income or profits of the Company and its Subsidiaries for such Reference
Period, to the extent that such provision for taxes was included in computing
such Consolidated Cash Flow, minus (ii) consolidated interest expense of the
Company and its Subsidiaries for such Reference Period, whether paid or
accrued and whether or not capitalized (including, without limitation,
amortization of original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed interest
with respect to Attributable Debt, commissions, discounts and other fees and
charges incurred in respect of letter of credit or bankers acceptance
financings, and net payments (if any) pursuant to Hedging Obligations), to the
extent that any such expense was deducted in computing such Consolidated Cash
Flow, minus (iii) up to $1.5 million in combined capital expenditures of the
Company and its Subsidiaries that are actually made during such Reference
Period (excluding any capital expenditures made with the proceeds from the
sale of the Notes), minus (iv) principal payments on Indebtedness permitted to
be incurred pursuant to Section 4.09, minus (v) non-interest payments in
respect of Capital Lease Obligations, in each case, on a consolidated basis
and determined in accordance with GAAP.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXCHANGE OFFER" means the offer that may be made by the Company
pursuant to the Registration Rights Agreement to exchange Series B Notes for
Series A Notes.
"FIXED CHARGE COVERAGE RATIO" means with respect to any Person for
any period, the ratio of the Consolidated Cash Flow of such Person and its
Subsidiaries for such period to the Fixed Charges of such Person and its
Subsidiaries for such period. In the event that the Company or any of its
Subsidiaries incurs, assumes, guarantees or redeems any Indebtedness (other
than revolving credit borrowings) or issues preferred stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but prior to the date on which the event for which the calculation
of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the
Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to
such incurrence, assumption, guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at the
beginning of the applicable Reference Period. In addition, for purposes of
making the computation referred to above, (i) acquisitions that have been made
by the Company or any of its Subsidiaries, including through mergers or
consolidations and including any related financing transactions, during the
Reference Period or subsequent to such Reference Period and on or prior to the
Calculation Date shall be deemed to have occurred on the first day of the
Reference Period and Consolidated Cash Flow for such Reference Period shall be
calculated without giving effect to clause (iii) of the proviso set forth in
the definition of Consolidated Net Income, and (ii) the Consolidated Cash Flow
attributable to discontinued operations, as determined in accordance with
GAAP, and operations or businesses disposed of prior to the Calculation Date,
shall be excluded, and (iii) the Fixed Charges attributable to discontinued
operations, as determined in accordance with GAAP, and operations or
businesses disposed of prior to the Calculation Date, shall be excluded, but
only to the extent that the obligations giving rise to such Fixed Charges will
not be obligations of the referent Person or any of its Subsidiaries following
the Calculation Date.
"FIXED CHARGES" means, with respect to any Person for any period,
without duplication, the sum of (i) the Consolidated Interest Expense of such
Person and (ii) the product of (a) all cash dividend payments (and non-cash
dividend payments in the case of a Person that is a Subsidiary) on any series
of preferred stock or Disqualified Stock of such Person, times (b) a fraction,
the numerator of which is one and the denominator of which is one minus the
then current combined federal, state and local statutory tax rate of such
Person, expressed as a decimal, in each case, on a consolidated basis and in
accordance with GAAP.
"FIXED INTEREST" shall have the meaning provided in paragraph 1 of
the Notes.
"FF&E" means furniture, fixtures or equipment used in the ordinary
course of the business of the Company and its Subsidiaries.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"GAMING AUTHORITY" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States of America or foreign government, any state, province or any
city or other political subdivision, whether now or hereafter existing, or any
officer or official thereof, including without limitation, the Louisiana
Gaming Control Board and any other agency with authority to regulate any
gaming operation (or proposed gaming operation) owned, managed or operated by
the Company or any of its Subsidiaries.
"GAMING FACILITY" means any tangible vessel, building or other
structure used or expected to be used to enclose space in which gaming
business is conducted and (i) wholly or partially owned, directly or
indirectly, by the Company or any of its Subsidiaries or (ii) any portion or
aspect of which is managed or used, or expected to be managed or used, by the
Company or any of its Subsidiaries.
"GAMING LAW" means the gaming laws of any jurisdiction or
jurisdictions to which the Company, any of its Subsidiaries or any of the
Guarantors is, or may at any time after the date of this Indenture, be
subject.
"GAMING LICENSE" means every license, franchise or other
authorization required to own, lease, operate or otherwise conduct gaming
activities of the Company or any of its Subsidiaries, including without
limitation, all such licenses granted under the Louisiana Riverboat Economic
Development and Gaming Control Act and regulated under the Louisiana Gaming
Control Law, the regulations promulgated pursuant to each such law, and other
applicable federal, state, foreign or local laws.
"GENERAL CONTRACTOR" means X.X. Xxxxxxx Corporation.
"GLOBAL NOTE" means a Note that contains the paragraph referred to
in footnote 1 and the additional schedule referred to in footnote 3 to the
form of the Note attached hereto as Exhibit A.
"GOVERNMENT SECURITIES" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States is pledged.
"GUARANTEE" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"GUARANTEES" means any guarantee given by any Guarantor pursuant to
the terms of this Indenture.
"GUARANTORS" means Jefferson Corp. and any Subsidiary of the Company
which has executed or hereafter executes a Guaranty in accordance with Section
4.18 hereof, and their successors and assigns.
"HEDGING OBLIGATIONS" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against
fluctuations in interest rates.
"HOLDER" means a Person in whose name a Note is registered.
"INDEBTEDNESS" means, with respect to any Person, any indebtedness
of such Person, whether or not contingent, in respect of borrowed money
(including accrued and unpaid Contingent Interest) or evidenced by bonds,
notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the balance deferred and unpaid of
the purchase price of any property or representing any Hedging Obligations,
except any such balance that constitutes an accrued expense or trade payable,
if and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP, as well as all
indebtedness of others secured by a Lien on any asset of such Person (whether
or not such indebtedness is assumed by such Person) and, to the extent not
otherwise included, the guarantee by such Person of any indebtedness of any
other Person.
"INDENTURE" means this Indenture, as amended or supplemented from
time to time.
"INDEPENDENT CONSTRUCTION CONSULTANT" means the independent
construction consultant to be retained by the Company pursuant to the Cash
Collateral and Disbursement Agreement in connection with the construction of
Casino Magic-Bossier City.
"INTEREST" when used with respect to any Note includes Fixed
Interest and Contingent Interest.
"INTEREST RESERVE ACCOUNT" means that certain account, to be
maintained by the Disbursement Agent pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $7.3 million
of the proceeds from the sale of the Notes will be deposited and used to
purchase the Pledged Securities.
"INVESTMENTS" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates), including, without
limitation, in the forms of direct or indirect loans (including guarantees of
Indebtedness or other obligations), advances or capital contributions (other
than advances to vendors and customers in the ordinary course of business that
are recorded as accounts receivable in accordance with GAAP and excluding
commission, travel and similar advances to officers and employees made in the
ordinary course of business and prepaid expenses and deposits in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a balance sheet prepared in
accordance with GAAP; PROVIDED that an acquisition of assets, Equity Interests
or other securities by the Company for consideration consisting of common
equity securities of the Company shall not be deemed to be an Investment. If
the Company or any Subsidiary of the Company sells or otherwise disposes of
any Equity Interests of any direct or indirect Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer a Subsidiary of the Company, the Company shall be deemed to have made
an Investment on the date of any such sale or disposition equal to the fair
market value of the Equity Interests of such Subsidiary not sold or disposed
of.
"ISSUE DATE" means August 23, 1996, the closing date for the sale
and delivery of the Notes.
"JEFFERSON CORP." means Jefferson Casino Corporation, a Louisiana
corporation.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, New York or the City of Hartford,
Connecticut or at a place of payment are authorized by law, regulation or
executive order to remain closed. If a payment date is a Legal Holi-day at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the interven-ing
period.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"LIQUIDATED DAMAGES" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement.
"LOUISIANA REFERENDUM" means the local option elections scheduled to
be held on November 5, 1996 on a parish-by-parish basis in the State of
Louisiana to determine whether to continue to permit existing forms of gaming
authorized by law to be conducted in each such parish.
"MANAGEMENT AGREEMENT" means that certain Management Agreement among
Casino Magic, the Manager and the Company relating to the license of the
Casino Magic name and the management of Casino Magic-Bossier City, as in
effect on the date of this Indenture or as may be amended in accordance with
Section 4.29 hereof.
"MANAGEMENT FEES" means any management fees payable to a subsidiary
of Casino Magic for services rendered pursuant to the Management Agreement.
"MANAGER" means Casino Magic Management Services, Inc., a wholly
owned subsidiary of Casino Magic.
"MINIMUM FACILITIES" means, with respect to Casino Magic-Bossier
City, a riverboat casino with at least 810 operating slot machines and 40
operating table games (but in no event less than 1,050 total gaming
positions), a 35,000 square foot entertainment pavilion, related amenities
(including a buffet restaurant, a gift shop, a bar and lounge area, and a
stage area with an open seating area) and covered parking for at least 1,255
cars.
"MORTGAGE" means that certain mortgage on the real property and
improvements constituting Casino Magic-Bossier City as amended or supplemented
from time to time in accordance with the terms of this Indenture and the
Collateral Documents.
"NET INCOME" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i) any
gain (but not loss), together with any related provision for taxes on such
gain (but not loss), realized in connection with (a) any Asset Sale
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) or (b) the disposition of any securities by such Person or any
of its Subsidiaries or the extinguishment of any Indebtedness of such Person
or any of its Subsidiaries and (ii) any extraordinary or nonrecurring gain
(but not loss), together with any related provision for taxes on such
extraordinary or nonrecurring gain (but not loss).
"NET LOSS PROCEEDS" means the aggregate cash proceeds received by
the Company or any of its Subsidiaries in respect of any Event of Loss,
including, without limitation, insurance proceeds from condemnation awards or
damages awarded by any judgment, net of the direct costs in recovery of such
Net Loss Proceeds (including, without limitation, legal, accounting, appraisal
and insurance adjuster fees and any relocation expenses incurred as a result
thereof), amounts required to be applied to the repayment of Indebtedness (to
the extent, in the case of revolving credit Indebtedness, such Indebtedness is
permanently reduced) secured by a Lien on the asset or assets that were the
subject of such Event of Loss, and any taxes paid or payable as a result
thereof.
"NET PROCEEDS" means the aggregate cash proceeds received by the
Company or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of
any non-cash consideration received in any Asset Sale), net of the direct
costs relating to such Asset Sale (including, without limitation, legal,
accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), amounts required to be applied
to the repayment of Indebtedness (to the extent, in the case of revolving
credit Indebtedness, such Indebtedness is permanently reduced) secured by a
Lien on the asset or assets that were the subject of such Asset Sale and any
reserve for adjustment in respect of the sale price of such asset or assets
established in accordance with GAAP.
"NOTE COLLATERAL" means all assets, now owned or hereafter acquired,
of the Company or any Guarantor pledged, collaterally assigned or with respect
to which a security interest has been granted to the Trustee in the Collateral
Documents, which will initially include all real estate, improvements and all
personal property owned by the Company, all accounts held by or for the
benefit of the Company, in each case with certain exceptions, and the Capital
Stock of the Company.
"NOTE CUSTODIAN" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"OFFICER" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Controller, the Secretary or any Vice President of such Person.
"OFFICERS' CERTIFICATE" means a certificate signed on behalf of the
Company or a Guarantor, as the case may be, by two Officers of the Company or
a Guarantor, as the case may be, one of whom must be the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company or a Guarantor, as the case may be, that
meets the requirements set forth in Section 13.05 hereof.
"OPERATING" means, with respect to Casino Magic-Bossier City, the
time that (i) all Gaming Licenses have been granted and have not been revoked
or suspended, (ii) all Liens (other than the Liens created by the Collateral
Documents or Permitted Liens) related to the construction of Casino
Magic-Bossier City have been paid or, if payment is not yet due or if such
payment is contested in good faith by the Company, sufficient funds remain in
the Construction Disbursement Account to discharge such Liens or such Liens
have been bonded with bonds in form and substance sufficient to satisfy such
Liens, (iii) the General Contractor, the project architect and the Independent
Construction Consultant of Casino Magic-Bossier City shall have delivered a
certificate to the Trustee certifying that Casino Magic-Bossier City is
complete in accordance with the Plans therefor and all applicable building
laws, ordinances and regulations, (iv) Casino Magic-Bossier City is in a
condition (including installation of furnishings, fixtures and equipment) to
receive guests in the ordinary course of business, (v) gaming and other
operations in accordance with applicable law are open to the general public
and are being conducted at Casino Magic-Bossier City, (vi) a permanent or
temporary certificate of occupancy has been issued for Casino Magic-Bossier
City by the parish in Louisiana in which Casino Magic-Bossier City will
operate, (vii) a notice of completion of Casino Magic-Bossier City has been
duly recorded and (viii) the Bossier Riverboat has been documented by the U.S.
Coast Guard in the name of the Company and the U.S. Coast Guard has issued a
final Certificate of Inspection for the Bossier Riverboat.
"OPERATING DEADLINE" means April 30, 1997.
"OPERATING HOTEL" means with respect to the Casino Magic-Bossier
City Hotel, the time that (i) all Liens (other than Permitted Liens) related
to the construction of the Casino Magic-Bossier City Hotel have been paid or,
if payment is not yet due or if such payment is contested in good faith,
sufficient funds have been escrowed to discharge such Liens or such Liens have
been bonded with bonds in form and substance sufficient to satisfy such Liens,
(ii) the project manager and the project architect shall have delivered a
certificate to the Trustee certifying that the Casino Magic-Bossier City Hotel
is complete in accordance with the plans therefor and applicable buildings
laws, ordinances and regulations, (iii) the Casino Magic-Bossier City Hotel is
in a condition (including installation of furnishings, fixtures and equipment)
to receive guests in the ordinary course of business and (iv) hotel operations
are open to the general public and are being conducted at the Casino
Magic-Bossier City Hotel.
"OPERATING RESERVE ACCOUNT" means that certain account, to be
maintained by the Disbursement Agent pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $3.2 million
of the proceeds from the sale of the Notes will be deposited.
"OPERATING YEAR" means (i) the period beginning on the date that
gaming operations commence at the Casino Magic-Bossier City casino through
December 31, 1997 and (ii) thereafter, each succeeding full fiscal year of the
Company.
"OPINION OF COUNSEL" means an opinion (which may contain customary
assumptions, qualifications and exceptions) from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
13.05 hereof, which legal counsel may be an employee of or counsel to the
Company, any Subsidiary of the Company, any Guarantor or the Trustee.
"PERMITTED HOLDERS" means (i) Xx. Xxxxxx X. Xxxxxxxx, Xx. Xxxxx X.
Xxxxxxx and Xx. Xxxxx X. Xxxx, (ii) any lineal descendants of any Person
described in the preceding clause (i), (iii) the spouse of any Person
described in the preceding clauses (i) or (ii), (iv) any controlled Affiliate
of any Person described in the preceding clauses (i), (ii) or (iii) and (v)
any trust solely for the benefit of any Person described in clauses (i) , (ii)
or (iii) of this definition.
"PERMITTED INVESTMENTS" means (a) any Investment in the Company or
in any Substantially Owned Subsidiary of the Company that is evidenced by
Capital Stock or Subsidiary Intercompany Notes that are pledged to the Trustee
as Note Collateral; (b) any Investment in Cash Equivalents; (c) any Investment
by the Company or any Subsidiary of the Company in a Person that is evidenced
by Capital Stock or Subsidiary Intercompany Notes that are pledged to the
Trustee as Note Collateral, if as a result of such Investment (i) such Person
becomes a Substantially Owned Subsidiary of the Company and a Guarantor that
is engaged in the same or a similar line of business as the Company and its
Subsidiaries were engaged in on the date of this Indenture or (ii) such Person
is merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or a
Substantially Owned Subsidiary of the Company that is a Guarantor and that is
engaged in the same or a similar line of business as the Company and its
Subsidiaries were engaged in on the date of this Indenture; (d) any Investment
made as a result of the receipt of non-cash consideration from an Asset Sale
that was made pursuant to and in compliance with Section 4.10 hereof; and (e)
deposits and accounts with, and certificates of deposit issued by, domestic
banks of recognized standing and having capital, surplus and undivided profits
of at least $25 million (which are not affiliated with the Company) doing
business in the jurisdictions in which the Company or any Subsidiary does
business.
"PERMITTED LIENS" means (i) Liens in favor of the Company; PROVIDED,
that if such Liens are on any Note Collateral, such Liens are either
collaterally assigned to the Trustee or subordinate to the Lien in favor of
the Trustee securing the Notes or any Guarantee; (ii) Liens on property of a
Person existing at the time such Person is merged into or consolidated with
the Company or any Subsidiary of the Company; PROVIDED that such Liens were in
existence prior to the contemplation of such merger or consolidation and do
not extend to any assets other than those of the Person merged into or
consolidated with the Company or such Subsidiary; (iii) Liens on property
existing at the time of acquisition thereof by the Company or any Subsidiary
of the Company, PROVIDED that such Liens were in existence prior to the
contemplation of such acquisition and do not extend to any assets other than
those of the Subsidiary so acquired; (iv) Liens to secure the performance of
statutory obligations, surety or appeal bonds, performance bonds or other
obligations of a like nature incurred in the ordinary course of business; (v)
Liens existing on the Issue Date; (vi) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded, PROVIDED that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor;
(vii) statutory Liens of landlords and carriers, warehousemen, mechanics,
suppliers, materialmen, repairmen or other like Liens arising in the ordinary
course of business and with respect to amounts not yet delinquent or being
contested in good faith by an appropriate process of law, and for which a
reserve or other appropriate provision, if any, as shall be required by GAAP
shall have been made, and, with respect to such Liens arising in connection
with Casino Magic-Bossier City, for which the Company has obtained the title
insurance endorsements required under the Cash Collateral and Disbursement
Agreement; (viii) Liens on FF&E to secure Indebtedness permitted by clause
(vi) of the second paragraph of Section 4.09; (ix) Liens on assets comprising
the Casino Magic-Bossier City Hotel to secure secured Indebtedness permitted
by clause (vii) of the second paragraph of Section 4.09; PROVIDED, that the
holder of such lien enters into a Reciprocal Easement Agreement in the form
attached as Exhibit O to this Indenture; (x) Liens securing obligations in
respect of this Indenture, the Notes or Guarantees; (xi) pledges or deposits
in the ordinary course of business to secure lease obligations or
nondelinquent obligations under workers' compensation, unemployment insurance
or similar legislation; (xii) easements, rights-of-way, restrictions, minor
defects or irregularities in title and other similar charges or encumbrances
not interfering in any material respect with the business of the Company or
any Subsidiary incurred in the ordinary course of business; (xiii) Liens
arising from filing UCC financing statements for precautionary purpose in
connection with true leases of personal property that are otherwise permitted
under this Indenture and under which the Company or any Subsidiary is lessee;
(xiv) Liens in favor of the Trustee, for the benefit of the Holders, granted
pursuant to this Indenture and the Collateral Documents; and (xv) any
replacement, renewals or extensions of those Liens permitted under subsections
(viii) and (ix) hereof.
"PERMITTED REFINANCING DEBT" means any Indebtedness of the Company
or any of its Subsidiaries issued in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Company or any of its Subsidiaries; PROVIDED that: (i)
the principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount (or accreted
value, if applicable) of the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of related prepayment
penalties, fees and reasonable expenses incurred in connection therewith);
(ii) such Permitted Refinancing Indebtedness has a final maturity date later
than the final maturity date of, and has a Weighted Average Life to Maturity
equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; (iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the
Notes, such Permitted Refinancing Indebtedness has a final maturity date later
than the final maturity date of, and is subordinated in right of payment to,
the Notes on terms at least as favorable to the Holders of Notes as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and (iv) such
Indebtedness is incurred by the Company.
"PERMITTED SECURITIES" means, with respect to an Asset Sale of the
Crescent City Riverboat, (i) notes or other obligations issued by the
transferee to the Company that (A) mature no later than the date that the
Notes mature, (B) bear interest at a rate no lower than the rate per annum
equal to 350 basis points over the average rate for United States Treasury
Securities of comparable maturity, (C) are secured by a first priority ship
mortgage in favor of the Company and (D) are issued by an issuer whose Fixed
Charge Coverage Ratio for its most recently ended four full fiscal quarters
for which internal financial statements are available immediately preceding
the date of such issuance is not less than 1.75 to 1.0 and (ii) voting equity
securities that are (A) issued by an issuer that (1) has a class of equity
securities that is traded on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq Stock Market, (2) has equity market value as of the
date of the consummation of such Asset Sale of $100,000,000 or more, PROVIDED,
that such voting equity securities constitute no more than 3% of the total
outstanding voting equity securities of such issuer, and (3) has senior
unsecured debt securities rated in a ratings category equal to or higher than
the Notes, as rated by both of Xxxxx'x Investors Service and Standard & Poor's
Ratings Group and (B) registered and freely tradeable by the Company under
applicable state and federal securities laws and listed for trading on a
national securities exchange or the Nasdaq Stock Market.
"PERSON" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"PLANS" means the plans and specifications for Casino Magic-Bossier
City, as delivered to the Company by the architect for the Casino
Magic-Bossier City on or before the Issue Date, including without limitation,
preliminary plans so delivered, and as finalized, amended, supplemented or
otherwise modified from time to time as approved by the independent
construction consultant in accordance with the terms of the Cash Collateral
and Disbursement Agreement.
"PLEDGED SECURITIES" means the securities purchased by the Company
with a portion of the proceeds from the sale of the Notes, which shall consist
of Government Securities, to be deposited in the Interest Reserve Account.
"PROJECT COSTS" means, with respect to the development, construction
and opening of the Casino Magic-Bossier City Hotel, the aggregate costs
required to complete such development, construction and opening in accordance
with the budget and the plans therefor and applicable legal requirements, as
set forth in an Officers' Certificate submitted to the Trustee, setting forth
in reasonable detail all amounts theretofore expended in connection with such
development, construction and opening, including direct costs related thereto
such as construction management, architectural, engineering and interior
design fees, site work, utility installations and hook-up fees, construction
permits, certificates and bonds, land acquisition costs, costs of furniture,
fixtures, furnishings, machinery and equipment, non-construction supplies and
pre-opening payroll, but excluding principal or interest payments on any
Indebtedness (other than interest which is required to be capitalized in
accordance with GAAP, which shall be included in determining Project Costs).
"REFERENCE PERIOD" means, with respect to any Person, the four full
fiscal quarters (or, with respect to the Company, such lesser number of full
fiscal quarters as have ended after the commencement of gaming operations at
Casino Magic-Bossier City) ended immediately prior to any date upon which any
determination is to be made.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of the date of this Indenture, by and among the Company
and the other parties named on the signature pages thereof, as such agreement
may be amended, modified or supplemented from time to time.
"RESPONSIBLE OFFICER" means with respect to the Trustee, any officer
within the Corporate Trust Administration of the Trustee (or any successor
group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"RESTRICTED INVESTMENT" means an Investment other than a Permitted
Investment.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SEMIANNUAL PERIOD" means each period that begins on July 1 and ends
on the next succeeding December 31 or each period that begins on January 1 and
ends on the next succeeding June 30.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"SUBSIDIARY" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person (or a combination thereof) and (ii) any partnership (a) the sole
general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (b) the only general partners of which are such
Person or one or more Subsidiaries of such Person (or any combination
thereof).
"SUBSIDIARY INTERCOMPANY NOTES" means the intercompany notes senior
to any subordinated indebtedness of, and pari passu with, all existing
unsubordinated indebtedness of the issuing Subsidiary, issued by Subsidiaries
of the Company in favor of the Company to evidence advances by the Company, in
each case, in the form attached as Exhibit E to this Indenture.
"SUBSTANTIALLY OWNED SUBSIDIARY" of any Person means a Subsidiary of
such Person at least 80% of the outstanding Capital Stock or other ownership
interests of which (other than directors' qualifying shares) shall at the time
be owned by such Person or by one or more Wholly Owned Subsidiaries of such
Person or by such Person and one or more Wholly Owned Subsidiaries of such
Person.
"TAX SHARING AGREEMENT" means the Tax Allocation Agreement, dated as
of October 14, 1993, as in effect on the Issue Date except for the
contemplated addition of Subsidiaries, among Casino Magic Finance Corp.,
Casino Magic, Biloxi Casino Corp., Mardi Gras Casino Corp. and each of the
other existing or future direct or indirect domestic Subsidiaries of Casino
Magic.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"TRANSFER RESTRICTED SECURITIES" means securities that bear or are
required to bear the legend set forth in Section 2.06 hereof.
"TRUSTEE" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"VESSEL PURCHASE AGREEMENT" means that certain Buy-Sell Agreement
dated August 2, 1996 between the Company and Xxxx Gaming Corporation, pursuant
to which the Company agreed to purchase the Bossier Riverboat.
"VOTING STOCK" means any class or classes of Capital Stock pursuant
to which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the Board of Directors, managers
or trustees of any Person (irrespective of whether or not, at the time, stock
of any other class or classes will have, or might have, voting power by reason
of the happening of any contingency).
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment, by (ii) the then outstanding
principal amount of such Indebtedness.
"WHOLLY OWNED SUBSIDIARY" of any Person means a Subsidiary of such
Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more Wholly Owned Subsidiaries of such Person.
SECTION 1.02. OTHER DEFINITIONS.
Term Defined in Section
"Affiliate Transaction" 4.12
"Asset Sale" 4.10
"Asset Sale Offer" 3.10
"Change of Control Offer" 4.16
"Change of Control Payment" 4.16
"Change of Control Payment Date" 4.16
"Covenant Defeasance" 8.03
"Disqualified Holder" 3.08
"DTC" 2.03
"Event of Default" 6.01
"Event of Loss Offer" 3.10
"Excess Cash Flow Redemption" 3.09
"Excess Cash Flow Redemption Amount" 3.09
"Excess Proceeds" 4.10
"Excess Proceeds Offer" 3.10
"incur" 4.09
"Legal Defeasance" 8.02
"Offer Amount" 3.10
"Offer Period" 3.10
"Paying Agent" 2.03
"Purchase Date" 3.10
"Registrar" 2.03
"Restricted Payments" 4.07
"Series A Notes" Recitals
"Series B Notes" Recitals
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"INDENTURE SECURITIES" means the Notes and the Guarantees;
"INDENTURE SECURITY HOLDER" means a Holder of a Note-;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee;
"OBLIGOR" on the Notes means the Company, the Guarantors and any
successor obligor upon the Notes or any Guarantee, as the case may be.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the mean-ings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
SECTION 2.01. FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Guarantee shall be
substantially in the form of Exhibit B. The Notes may have notations, legends
or endorsements required by law, stock exchange rule or usage. Each Note
shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute,
and are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
Notes issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the text referred to in footnotes 1 and 2
thereto). Notes issued in definitive form shall be substantially in the form
of Exhibit A attached hereto (but without including the text referred to in
footnote 1 thereto). Each Global Note shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that it shall
represent the aggregate amount of outstanding Notes from time to time endorsed
thereon and that the aggregate amount of outstanding Notes represented thereby
may from time to time be reduced or increased, as appropriate, to reflect
exchanges and redemptions. Any endorsement of a Global Note to reflect the
amount of any increase or decrease in the amount of outstanding Notes
represented thereby shall be made by the Trustee or the Note Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers, authenticate Notes for original issue up to the aggregate principal
amount stated in paragraph 4 of the Notes. The aggregate principal amount of
Notes outstanding at any time may not exceed such amount except as provided in
Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company
or an Affiliate of the Company.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("REGISTRAR") and an
office or agency where Notes may be presented for payment ("PAYING AGENT").
The Registrar shall keep a register of the Notes and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and
the term "Paying Agent" includes any additional paying agent. The Company may
change any Paying Agent or Registrar without notice to any Holder. The
Company shall notify the Trustee in writing of the name and address of any
Agent not a party to this Indenture. If the Company fails to appoint or
maintain another entity as Registrar or Paying Agent, the Trustee shall act as
such. The Company or any of its Subsidiaries may act as Paying Agent or
Registrar.
The Company initially appoints The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar
and Paying Agent and to act as Note Custodian with respect to the Global
Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent will hold in trust for the benefit
of Holders or the Trustee all money held by the Paying Agent for the payment
of principal, premium or Liquidated Damages, if any, or interest on the Notes,
and shall notify the Trustee of any default by the Company or any Guarantor in
making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The
Company at any time may require a Paying Agent to pay all money held by it to
the Trustee. Upon payment over to the Trustee, the Paying Agent (if other
than the Company or a Subsidiary) shall have no further liability for the
money. If the Company or a Subsidiary acts as Paying Agent, it shall
segregate and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company or any Guarantor, the Trustee shall serve
as Paying Agent for the Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA 312(a). If the Trustee is
not the Registrar, the Company or the Guarantors shall furnish to the Trustee
at least seven Business Days before each interest payment date and at such
other times as the Trustee may request in writing, a list in such form and as
of such date as the Trustee may reasonably require of the names and addresses
of the Holders of Notes and the Company and the Guarantors shall otherwise
comply with TIA 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES. When Definitive
Notes are presented by a Holder to the Registrar with a request:
(x) to register the transfer of the Definitive Notes; or
(y) to exchange such Definitive Notes for an equal
principal amount of Definitive Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; PROVIDED, HOWEVER, that the
Definitive Notes presented or surrendered for register of transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by his attorney, duly authorized in writing; and
(ii) in the case of a Definitive Note that is a
Transfer Restricted Security, such request shall be accompanied by the
following additional information and documents, as applicable:
(A) such Transfer Restricted Security is being
delivered to the Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification to that effect from such Holder (in
substantially the form of Exhibit C hereto); or
(B) if such Transfer Restricted Security is being
transferred to a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act) in accordance with Rule 144A under the Securities
Act or pursuant to an exemption from registration in accordance with Rule 144
or Rule 904 under the Securities Act or pursuant to an effective registration
statement under the Securities Act, a certification to that effect from such
Holder (in substantially the form of Exhibit C hereto); or
(C) if such Transfer Restricted Security is being
transferred in reliance on another exemption from the registration
requirements of the Securities Act, a certification to that effect from such
Holder (in substantially the form of Exhibit C hereto) and an Opinion of
Counsel from such Holder or the transferee reasonably acceptable to the
Company and to the Registrar to the effect that such transfer is in compliance
with the Securities Act.
(b) TRANSFER OF A DEFINITIVE NOTE FOR A BENEFICIAL INTEREST IN A
GLOBAL NOTE. A Definitive Note may not be exchanged for a beneficial interest
in a Global Note except upon satisfaction of the requirements set forth below.
Upon receipt by the Trustee of a Definitive Note, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory to
the Trustee, together with:
(i) if such Definitive Note is a Transfer Restricted Security,
and
(A) such Definitive Note is being exchanged for a
beneficial interest in the name of such Holder, without transfer, a
certification to that effect from such Holder (in substantially the form of
Exhibit C hereto);
(B) such Definitive Note is being transferred by such
Holder to a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act or
pursuant to an exemption from registration in accordance with Rule 144 or Rule
904 under the Securities Act or pursuant to an effective registration
statement under the Securities Act, a certification from the Holder thereof
(in substantially the form of Exhibit C hereto) to that effect; or
(C) such Definitive Security is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act, a certification to that effect from such Holder (in
substantially the form of Exhibit C hereto) and an Opinion of Counsel from
such Holder or the transferee reasonably acceptable to the Company and to the
Registrar to the effect that such transfer is in compliance with the
Securities Act; and
(ii) whether or not such Definitive Note is a Transfer
Restricted Security, written instructions from the Holder thereof directing
the Trustee to make, or to direct the Note Custodian to make, an endorsement
on the Global Note to reflect an increase in the aggregate principal amount of
the Notes represented by the Global Note,
in which case the Trustee shall cancel such Definitive Note in accordance with
Section 2.11 hereof and cause, or direct the Note Custodian to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Note Custodian, the aggregate principal amount of Notes
represented by the Global Note to be increased accordingly. If no Global
Notes are then outstanding, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.11 hereof, the Trustee shall
authenticate a new Global Note in the appropriate principal amount.
(c) TRANSFER AND EXCHANGE OF GLOBAL NOTES. The transfer and exchange
of Global Notes or beneficial interests therein shall be effected through the
Depositary, in accordance with this Indenture and the procedures of the
Depositary therefor, which shall include restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
(d) TRANSFER OF A BENEFICIAL INTEREST IN A GLOBAL NOTE FOR A
DEFINITIVE NOTE.
(i) Any Person having a beneficial interest in a Global Note may
upon request exchange such beneficial interest for a Definitive Note. Upon
receipt by the Trustee of written instructions or such other form of
instructions as is customary for the Depositary, from the Depositary or its
nominee on behalf of any Person having a beneficial interest in a Global Note,
and, in the case of a Transfer Restricted Security, the following additional
information and documents (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred to the
Person designated by the Depositary as being the beneficial owner, a
certification to that effect from such Person (in substantially the form of
Exhibit C hereto); or
(B) if such beneficial interest is being transferred to a
"qualified institutional buyer" (as defined in Rule 144A under the Securities
Act) in accordance with Rule 144A under the Securities Act or pursuant to an
exemption from registration in accordance with Rule 144 or Rule 904 under the
Securities Act or pursuant to an effective registration statement under the
Securities Act, a certification to that effect from the transferor (in
substantially the form of Exhibit C hereto); or
(C) if such beneficial interest is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act, a certification to that effect from the transferor (in
substantially the form of Exhibit C hereto) and an Opinion of Counsel from the
transferee or transferor reasonably acceptable to the Company and to the
Registrar to the effect that such transfer is in compliance with the
Securities Act,
in which case the Trustee or the Note Custodian, at the direction of the
Trustee, shall, in accordance with the standing instructions and procedures
existing between the Depositary and the Note Custodian, cause the aggregate
principal amount of Global Notes to be reduced accordingly and, following such
reduction, the Company shall execute and, the Trustee shall authenticate and
deliver to the transferee a Definitive Note in the appropriate principal
amount.
(ii) Definitive Notes issued in exchange for a beneficial
interest in a Global Note pursuant to this Section 2.06(d) shall be registered
in such names and in such authorized denominations as the Depositary, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered.
(e) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL NOTES.
Notwithstanding any other provision of this Indenture (other than the
provisions set forth in subsection (f) of this Section 2.06), a Global Note
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(f) AUTHENTICATION OF DEFINITIVE NOTES IN ABSENCE OF DEPOSITARY. If
at any time:
(i) the Depositary for the Notes notifies the Company that the
Depositary is unwilling or unable to continue as Depositary for the Global
Notes and a successor Depositary for the Global Notes is not appointed by the
Company within 90 days after delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Trustee
in writing that it elects to cause the issuance of Definitive Notes under this
Indenture,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, Definitive Notes in an aggregate principal amount equal to the
principal amount of the Global Notes in exchange for such Global Notes.
(g) LEGENDS.
(i) Except as permitted by the following paragraphs (ii)
and (iii), each Note certificate evidencing Global Notes and Definitive Notes
(and all Notes issued in exchange therefor or substitution thereof) shall bear
legends in substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX
XXX XXXXXX XXXXXX SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THE
SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON WHO
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF
THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."
PURSUANT TO PROVISIONS OF THE INTERNAL REVENUE CODE OF
1986 RELATING TO ORIGINAL ISSUE DISCOUNT AND TREASURY REGULATIONS PUBLISHED
THEREUNDER, THE FOLLOWING INFORMATION IS PROVIDED: (1) THIS SECURITY IS BEING
ISSUED WITH ORIGINAL ISSUE DISCOUNT IN THE AMOUNT OF $1018.76 PER $1000 OF
PRINCIPAL AMOUNT DUE AT MATURITY; (2) THE ISSUE PRICE OF THIS SECURITY IS
$1000 PER $1000 OF PRINCIPAL AMOUNT DUE AT MATURITY; (3) THE ISSUE DATE OF
THIS SECURITY IS AUGUST 22, 1996; (4) THE "COMPARABLE YIELD" TO MATURITY OF
THIS SECURITY (WITHIN THE MEANING OF TREASURY REGULATION 1.1275-4) IS 14.51%,
AND (5) THE "PROJECTED PAYMENT SCHEDULE" (WITHIN THE MEANING OF TREASURY
REGULATION SECTION 1.1275-4) IS AS FOLLOWS:
DATE AMOUNT PER $1000
2/15/97 $66.38
8/15/97 $73.26
2/15/98 $73.26
8/15/98 $73.26
2/15/99 $73.26
8/15/99 $73.26
2/15/00 $73.26
8/15/00 $73.26
2/15/01 $73.26
8/15/01 $73.26
2/15/02 $73.26
8/15/02 $73.26
2/15/03 $73.26
8/15/03 $73.26
HOLDERS SHOULD REFER TO THE DISCUSSION OF CERTAIN FEDERAL
INCOME TAX CONSIDERATIONS SET FORTH IN THE OFFERING MATERIALS RELATING TO THE
NOTES. CONTACT THE COMPANY AT 0000 XXX XXXXXX XXXX, XXXXXXX XXXX, XXXXXXXXX
00000, ATTENTION: CORPORATE SECRETARY FOR MORE DETAILED INFORMATION CONCERNING
THE COMPUTATION OF ORIGINAL ISSUE DISCOUNT SET FORTH HEREIN.
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a Global
Note) pursuant to Rule 144 under the Securities Act or pursuant to an
effective registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Security
that is a Definitive Note, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a Definitive Note that does not
bear the first legend set forth in (i) above and rescind any restriction on
the transfer of such Transfer Restricted Security; and
(B) in the case of any Transfer Restricted Security
represented by a Global Note, such Transfer Restricted Security shall not be
required to bear the first legend set forth in (i) above, but shall continue
to be subject to the provisions of Section 2.06(c) hereof; PROVIDED, HOWEVER,
that with respect to any request for an exchange of a Transfer Restricted
Security that is represented by a Global Note for a Definitive Note that does
not bear the legend set forth in (i) above, which request is made in reliance
upon Rule 144, the Holder thereof shall certify in writing to the Registrar
that such request is being made pursuant to Rule 144 (such certification to be
substantially in the form of Exhibit C hereto).
(iii) Notwithstanding the foregoing, upon consummation of
the Exchange Offer, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.02 hereof, the Trustee shall
authenticate Series B Notes in exchange for Series A Notes accepted for
exchange in the Exchange Offer, which Series B Notes shall not bear the first
legend set forth in (i) above, and the Registrar shall rescind any restriction
on the transfer of such Notes, in each case unless the Holder of such Series A
Notes is either (A) a broker-dealer, (B) a Person participating in the
distribution of the Series A Notes or (C) a Person who is an affiliate (as
defined in Rule 144A) of the Company.
(h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such
time as all beneficial interests in Global Notes have been exchanged for
Definitive Notes, redeemed, repurchased or cancelled, all Global Notes shall
be returned to or retained and cancelled by the Trustee in accordance with
Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for Definitive Notes,
redeemed, repurchased or cancelled, the principal amount of Notes represented
by such Global Note shall be reduced accordingly and an endorsement shall be
made on such Global Note, by the Trustee or the Note Custodian, at the
direction of the Trustee, to reflect such reduction.
(i) GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES.
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate
Definitive Notes and Global Notes at the Registrar's request.
(ii) No service charge shall be made to a Holder for
any registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections
3.07, 3.09, 3.10, 4.10, 4.11, 4.16 and 9.05 hereto).
(iii) The Registrar shall not be required to register
the transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Definitive Notes and Global Notes issued upon
any registration of transfer or exchange of Definitive Notes or Global Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Definitive Notes or
Global Notes surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required:
(A) to issue, to register the transfer of or to
exchange Notes during a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption under Section 3.02
hereof and ending at the close of business on the day of selection; or
(B) to register the transfer of or to exchange
any Note so selected for redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part; or
(C) to register the transfer of or to exchange a
Note between a record date and the next succeeding interest payment date.
(vi) Prior to due presentment for the registration of
a transfer of any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and interest on
such Notes, and neither the Trustee, any Agent nor the Company shall be
affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive Notes
and Global Notes in accordance with the provisions of Section 2.02 hereof.
SECTION 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee, or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee, upon the
written order of the Company signed by two Officers of the Company, shall
authenticate a replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Company, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Company
to protect the Company, the Trustee, any Agent and any authenticating agent
from any loss that any of them may suffer if a Note is replaced. The Company
may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company
and shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by
the Trustee in accordance with the provisions hereof, and those described in
this Section as not outstanding. Except as set forth in Section 2.09 hereof,
a Note does not cease to be outstanding because the Company or an Affiliate of
the Company holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by
the Company, any Guarantor or by any Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company
or any Guarantor, shall be considered as though not outstanding, except that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes that a Trustee
knows are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes upon a written
order of the Company signed by two Officers of the Company. Temporary Notes
shall be substantially in the form of definitive Notes but may have variations
that the Company considers appropriate for temporary Notes and as shall be
reasonably acceptable to the Trustee. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Notes in exchange
for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of this
Indenture.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee and no one else shall cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy cancelled Notes (subject to the record retention requirement of
the Exchange Act). Certification of the destruction of all cancelled Notes
shall be delivered to the Company. The Company may not issue new Notes to
replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each
Note and the date of the proposed payment. The Company shall fix or cause to
be fixed each such special record date and payment date, PROVIDED that no such
special record date shall be less than 10 days prior to the related payment
date for such defaulted interest. At least 15 days before the special record
date, the Company (or, upon the written request of the Company, the Trustee in
the name and at the expense of the Company) shall mail or cause to be mailed
to Holders a notice that states the special record date, the related payment
date and the amount of such interest to be paid.
SECTION 2.13. EXCHANGE REGISTRATION.
In the event that the Company delivers to the Trustee a copy of an
order of effectiveness or a certification of the Company with respect to such
effectiveness with respect to the Exchange Offer, the Trustee shall, at the
Company's expense, notify the Holders of the receipt of such order of
effectiveness or certification and upon the request of any Holder shall
exchange such Holder's Series A Notes for Series B Notes upon the terms set
forth in the Exchange Offer.
ARTICLE 3
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursu-ant to the optional
redemption provisions of Section 3.07 hereof or is otherwise required to
redeem Notes pursuant to any other provision of this Indenture, it shall
furnish to the Trustee at least 30 days but not more than 60 days before a
redemption date (or such lesser period as may be acceptable to the Trustee),
an Officers' Certificate setting forth (i) the clause of this Indenture
pursuant to which the redemption shall occur, (ii) the redemption date, (iii)
the principal amount of Notes to be redeemed and (iv) the redemption price.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select the Notes- to be redeemed among the Holders of the Notes
in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed or, if the Notes are not so
listed, on a PRO RATA basis, by lot or in accordance with any other method the
Trustee considers fair and appropriate (and in such manner as complies with
applicable legal requirements). In the event of partial redemption by lot,
the particular Notes to be redeemed shall be selected, unless otherwise
provided herein, not less than 30 nor more than 60 days prior to the
redemption date by the Trustee from the outstanding Notes not previously
called for redemption.
The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of $1,000 or whole multiples of
$1,000; except that if all of the Notes- of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not a multiple
of $1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
Subject to the provisions of Sections 3.08 and 3.10 hereof, at least
30 days but not more than 60 days before a redemption date, the Company shall
mail or cause to be mailed, by first class mail, a notice of redemption to
each Holder whose Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued upon cancellation of the
original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemp-tion price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemp-tion ceases to accrue on and
after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; PROVIDED, HOWEVER, that
the Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date (or such lesser period as may be acceptable to the Trustee),
an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemp-tion date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 a.m. on the redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay the
redemption price of and accrued interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly return to the Company
any money deposited with the Trustee or the Paying Agent by the Company in
excess of the amounts necessary to pay the redemption price of, and accrued
interest on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is
redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest shall be paid to
the Person in whose name such Note was registered at the close of business on
such record date. If any Note called for redemption shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall be paid on the unpaid principal, from
the redemption date until such principal is paid, and to the extent lawful on
any interest not paid on such unpaid principal, in each case at the rate
provided in the Notes and in Section 4.01 hereof.
SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authen-ticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) The Company shall not have the option to redeem the Notes
pursuant to this Section 3.07 prior to August 15, 2000. Thereafter, the
Company shall have the option to redeem the Notes, in whole or in part, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the applicable redemption date, if redeemed during the twelve-month period
beginning on August 15 of the years indicated below:
YEAR PERCENTAGE
2000 106.500%
2001 104.332%
2002 102.166%
(b) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof.
SECTION 3.08. REDEMPTION PURSUANT TO GAMING LAW.
(a) Notwithstanding any other provision of this Indenture, if
any Gaming Authority requires that a Holder or beneficial owner of the Notes
must be licensed, qualified or found suitable under any applicable Gaming Law
in order to maintain any or obtain any applied-for Gaming License or franchise
of the Company or any of its Subsidiaries under any applicable Gaming Law, and
such Holder or beneficial owner fails to apply for a license, qualification or
finding of suitability within 30 days after being requested to do so by such
Gaming Authority (or such lesser period that may be required by such Gaming
Authority or Gaming Law) or if such Holder or beneficial owner is not so
licensed, qualified or found suitable by such Gaming Authority (a
"Disqualified Holder"), the Company shall have the right, at its option, (i)
to require such Disqualified Holder or beneficial owner to dispose of such
Disqualified Holder's or beneficial owner's Notes within 30 days of notice of
such finding by the applicable Gaming Authority that such Holder or beneficial
owner will not be licensed, qualified or found suitable as directed by such
Gaming Authority (or such earlier date as may be required by the applicable
Gaming Authority or Gaming Law) or (ii) to call for redemption of the Notes of
such Disqualified Holder or beneficial owner at a redemption price equal to
the lesser of 100% of the principal amount thereof or the price at which such
Holder or beneficial owner acquired such Notes together with, in either case,
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
earlier of the date of redemption or the date of the finding of unsuitability
by such Gaming Authority, which may be less than 30 days following the notice
of redemption if so ordered by such Gaming Authority. Immediately upon a
determination of unsuitability, the Disqualified Holder shall have no further
rights whatsoever with respect to the Notes (i) to exercise, directly or
indirectly, through any trustee, nominee or any other Person or entity, any
right conferred by the Notes or (ii) to receive any interest or any other
distribution or payment with respect to the Notes, or any remuneration in any
form from the Company for services rendered or otherwise, except the
redemption price of the Notes. The Company shall not be required to pay or
reimburse any Holder or beneficial owner of Notes who is required to apply for
such license, qualification or finding of suitability for the costs of such
application including investigatory costs.
(b) Any redemption pursuant to this Section 3.08 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof (except to the
extent otherwise required by a Gaming Authority or Gaming Law).
SECTION 3.09. MANDATORY REDEMPTION.
(a) In addition to any payments required by Sections 3.08, 4.10,
4.11 or 4.16 hereof, in the event that the voters in the Louisiana Referendum
disapprove the continuation of riverboat gaming in either Bossier Parish or
Caddo Parish, Louisiana, then within 90 days after the end of each Operating
Year, the Company shall redeem (the "Excess Cash Flow Redemption") the maximum
principal amount of Notes that is an integral multiple of $1,000, that may be
redeemed with 100% of the Company's Excess Cash Flow (the "Excess Cash Flow
Redemption Amount") with respect to such Operating Year, at a redemption price
in cash equal to 100% of the principal amount of Notes to be redeemed, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
date of redemption; PROVIDED, HOWEVER, that the Excess Cash Flow Redemption
Amount shall be reduced by the minimum amount necessary to allow the balance
of Cash Equivalents held by the Company to exceed $5.0 million; PROVIDED,
FURTHER, HOWEVER, that if (i) the voters in the Louisiana Referendum
disapprove the continuation of riverboat gaming in one but not the other of
Bossier Parish or Caddo Parish, Louisiana and (ii) the Company, prior to the
end of its first Operating Year, has obtained a final, non-appealable
determination or decision by (i) all Gaming Authorities and other applicable
governmental regulatory authorities having jurisdiction over the operations of
the Company including without limitation, gaming operations of the Company, or
(ii) a court of competent jurisdiction considering such matter or matters, in
each case the effect of which is that the Company is permitted to conduct
riverboat gaming operations at Casino Magic-Bossier City, the Company's
obligations to make Excess Cash Flow Redemptions shall terminate.
(b) Any redemption pursuant to this Section 3.09 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof (except to the
extent otherwise required by a Gaming Authority).
SECTION 3.10. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 or 4.11 hereof, the
Company shall be required to commence an offer to all Holders to purchase
Notes (an "ASSET SALE OFFER" or an "EVENT OF LOSS OFFER," respectively, and
either one an "EXCESS PROCEEDS OFFER"), it shall follow the procedures
specified below.
The Excess Proceeds Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "OFFER PERIOD"). No
later than five Business Days after the termination of the Offer Period (the
"PURCHASE DATE"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 or 4.11 hereof, as the case
may be (the "OFFER AMOUNT"), or, if less than the Offer Amount has been
tendered, all Notes tendered in response to the Excess Proceeds Offer.
Payment for any Notes so purchased shall be made in the same manner as
interest payments are made.
If the Purchase Date is on or after an interest record date and on
or before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Excess Proceeds Offer.
Upon the commencement of an Excess Proceeds Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders,
with a copy to the Trustee. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Notes pursuant to the
Excess Proceeds Offer. The Excess Proceeds Offer shall be made to all
Holders. The notice, which shall govern the terms of the Excess Proceeds
Offer, shall state:
(a) that the Excess Proceeds Offer is being made pursuant
to this Section 3.10 and Section 4.10 or 4.11 hereof, as the case may be, and
the length of time the Excess Proceeds Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase
Date;
(c) that any Note not tendered or accepted for payment
shall continue to accrue interest;
(d) that, unless the Company defaults in making such
payment, any Note accepted for payment pursuant to the Excess Proceeds Offer
shall cease to accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant
to an Excess Proceeds Offer may only elect to have all of such Note purchased
and may not elect to have only a portion of such Note purchased;
(f) that Holders electing to have a Note purchased pursuant
to any Excess Proceeds Offer shall be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a depositary,
if appointed by the Company, or a Paying Agent at the address specified in the
notice prior to the close of business on the third Business Day preceding the
Purchase Date;
(g) that Holders shall be entitled to withdraw their
election if the Company, the depositary or the Paying Agent, as the case may
be, receives, not later than the expiration of the Offer Period, a telegram,
telex, facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note
purchased;
(h) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, the Trustee shall select the
Notes- to be redeemed among the Holders of the Notes in compliance with the
requirements of the principal national securities exchange, if any, on which
the Notes are listed or, if the Notes are not so listed, on a PRO RATA basis,
by lot or in accordance with any other method the Trustee considers fair and
appropriate (and in such manner as complies with applicable legal
requirements) (with such adjustments as may be deemed appropriate by the
Trustee so that only Notes in denominations of $1,000, or integral multiples
thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part
shall be issued new Notes equal in principal amount to the unpurchased portion
of the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a PRO RATA basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Excess
Proceeds Offer, or if less than the Offer Amount has been tendered, all Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating
that such Notes or portions thereof were accepted for payment by the Company
in accordance with the terms of this Section 3.10. The Company, the
depositary or the Paying Agent, as the case may be, shall promptly (but in any
case not later than five days after the Purchase Date) mail or deliver to each
tendering Holder an amount equal to the purchase price of the Notes tendered
by such Holder and accepted by the Company for purchase, and the Company shall
promptly issue a new Note, and the Trustee, upon written request from the
Company shall authenticate and mail or deliver such new Note to such Holder,
in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered
by the Company to the Holder thereof. The Company shall publicly announce the
results of the Excess Proceeds Offer on the Purchase Date. The Company shall
comply with the requirements of Rule 14e-1 under the Exchange Act and any
other securities laws and regulations thereunder to the extent that such laws
and regulations are applicable in connection with any Excess Proceeds Offer.
Other than as specifically provided in this Sec-tion 3.10, any
purchase pursuant to this Section 3.10 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
The Company shall pay or cause to be paid the principal of, premium,
if any, and interest on the Notes on the dates and in the manner provided in
the Notes. Principal, premium, if any, and interest shall be considered paid
on the date due if the Paying Agent, if other than the Company or a Subsidiary
thereof, holds as of 10:00 a.m. Eastern Time on the due date money deposited
by the Company in immediately available funds and desig-nated for and
sufficient to pay all principal, premium, if any, and interest then due as set
forth in an Officers' Certificate delivered to the Trustee, which Officers'
Certificate shall set forth, in reasonable detail, a calculation of the
amounts then due and the amount of any deferral of Contingent Interest in
accordance with the terms of the Notes. The Company shall pay all Liquidated
Damages, if any, in the same manner on the dates and in the amounts set forth
in the Registration Rights Agreement.
The Company shall pay interest (including post--petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments
of interest and Liquidated Damages (without regard to any applicable grace
period) at the same increased rate to the extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company or the Guarantors in respect of the Notes and
this Indenture may be served. The Company shall give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations;
PROVIDED, HOWEVER, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or
agency.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
SECTION 4.03. REPORTS.
(a) Whether or not required by the rules and regulations of the
SEC, (and within 15 days of the date that is or would be prescribed thereby),
so long as any Notes are outstanding, the Company shall furnish to the Trustee
and to all Holders (i) all quarterly and annual financial information that
would be required to be contained in a filing with the SEC on Forms 10-Q and
10-K (without exhibits) if the Company were required to file such forms,
including a "Management's Discussion and Analysis of Financial Condition and
Results of Operations" that describes the financial condition and results of
operations of the Company and its Subsidiaries and, with respect to the annual
information only, a report thereon by the Company's certified independent
accountants and (ii) all current reports that would be required to be filed
with the SEC on Form 8-K if the Company were required to file such reports.
In addition, whether or not required by the rules and regulations of the SEC,
the Company shall file a copy of all such information and reports with the SEC
for public availability (unless the SEC will not accept such a filing) and
shall make such information available to securities analysts and prospective
investors upon request. The Company and the Guarantors shall at all times
comply with TIA 314(a).
(b) The Company shall also include in all such reports provided
pursuant to paragraph (a) hereof: (i) in all such reports issued prior to the
Operating Deadline the anticipated Commencement Date, (ii) in the case of all
other quarterly reports, the Contingent Interest paid, the Contingent Interest
Accrual Amount and the Company's Adjusted Consolidated Cash Flow with respect
to the most recently ended fiscal quarter of the Company, (iii) in the case of
annual reports, the audited Contingent Interest paid, the Contingent Interest
Accrual Amount and the audited Company's Adjusted Consolidated Cash Flow for
the most recently ended fiscal year and for each of the Semiannual Periods
ending in such fiscal year.
(c) The Company shall also provide to the Trustee on February 1 and
August 1 of each year an Officers' Certificate signed by the Chief Financial
Officer of the Company setting forth (i) whether the Company is electing to
defer Contingent Interest for the next succeeding Interest Payment Date, and
if so, providing a calculation in reasonable detail of the basis for such
deferral as provided in paragraph 1 of the Notes including a calculation of
the Company's Adjusted Fixed Charge Coverage Ratio for the most recently
completed Reference Period, (ii) a calculation of the Contingent Interest
Accrual Amount and the Company's Adjusted Consolidated Cash Flow for the most
recently completed Semiannual Period (and with respect to such Officers'
Certificate delivered on February 1, 1997 for the period ended December 31,
1996).
(d) For so long as any Series A Notes remain outstanding, the
Company and the Guarantors shall furnish to the Holders and to securities
analysts and prospective investors, upon their request, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervi-sion of the signing
Officers with a view to determining whether the Company and each obligor on
the Notes and this Indenture has kept, observed, performed and fulfilled its
obligations under this Indenture and each Collateral Document, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company and each such obligor has kept, observed,
performed and fulfilled each and every covenant contained in this Indenture
and each Collateral Document and is not in default in the performance or
observance of any of the terms, provisions and conditions of this Indenture or
any Collateral Document (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she
may have knowledge and what action the Company or such obligor, as the case
may be, is taking or proposes to take with respect thereto) and that to the
best of his or her knowledge no event has occurred and remains in existence by
reason of which payments on account of the principal of or interest, if any,
on the Notes is prohibited or if such event has occurred, a description of the
event and what action the Company or such obligor, as the case may be, is
taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations
of the American Institute of Certified Public Accountants, the year-end
financial statements delivered pursuant to Section 4.03(a) above shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial
statements, nothing has come to their attention that would lead them to
believe that the Company has violated any provisions of Article 4 or Article 5
hereof or, if any such violation has occurred, specifying the nature and
period of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to obtain
knowledge of any such violation.
(c) The Company shall, so long as any of the Note-s are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes
to take with respect thereto.
SECTION 4.05. TAXES.
(a) The Company shall pay, and shall cause each of its Subsidiaries
to pay, prior to delinquency, all material taxes, assess-ments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.
(b) Within 60 days of the date of the Indenture, the Guarantor and
the Company shall provide the Trustee with evidence of the tax good standing
of each of the Guarantor and the Company in the state of Louisiana.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
The Company and each of the Guarantors covenants (to the extent that
it may lawfully do so) that it shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Company and each of the Guarantors (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not, by resort to any such law, hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
From and after the Issue Date, the Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly: (i) declare or pay
any dividend or make any other payment or distribution on account of the
Company's or any of its Subsidiaries' Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation
involving the Company) or to the direct or indirect holders of the Company's
Equity Interests in any capacity (other than payments in respect of the Notes
or dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company or dividends or distributions payable by a
Wholly Owned Subsidiary or Substantially Owned Subsidiary of the Company to
the Company, any Wholly Owned Subsidiary or Substantially Owned Subsidiary);
(ii) purchase, redeem or otherwise acquire or retire for value any Equity
Interests of the Company or any direct or indirect parent of the Company or
other Affiliate of the Company (other than any such Equity Interests owned by
the Company or any Wholly Owned Subsidiary or Substantially Owned Subsidiary
of the Company that is a Guarantor); (iii) make any principal payment on, or
purchase, redeem, defease or otherwise acquire or retire for value any
Indebtedness that is PARI PASSU with or subordinated in right of payment to
the Notes (other than Notes), in each case except at final stated maturity
and, in the case of PARI PASSU Indebtedness, except in accordance with any
sinking fund or mandatory repurchase or redemption provisions thereof; or (iv)
make any Restricted Investment (all such payments and other actions set forth
in clauses (i) through (iv) above being collectively referred to as
"Restricted Payments"), unless, at the time of and after giving effect to such
Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(b) the voters in the Louisiana Referendum have approved the
continuation of riverboat gaming in Bossier Parish and Caddo Parish, Louisiana
or voters in the Louisiana Referendum have disapproved the continuation of
riverboat gaming in one but not the other of Bossier Parish or Caddo Parish,
Louisiana and the Company has obtained a final, non-appealable determination
or decision by (i) all Gaming Authorities and other applicable governmental
regulatory authorities having jurisdiction over the operations of the Company,
including, without limitation, gaming operations of the Company or (ii) a
court of competent jurisdiction considering such matter or matters, in each
case the effect of which is that the Company is permitted to conduct riverboat
gaming operations at Casino Magic-Bossier City; and
(c) all Contingent Interest due and payable on the Interest
Payment Date immediately preceding the date of such Restricted Payment has
been paid; and
(d) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable Reference Period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth in the first paragraph of Section
4.09 hereof; and
(e) such Restricted Payment, together with the aggregate amount
of all other Restricted Payments made by the Company and its Subsidiaries
after the date of this Indenture (excluding Restricted Payments permitted by
clauses A(1), A(2), A(3), A(5) and (B) of the next succeeding paragraph), is
less than the sum of (i) 50% of the Consolidated Net Income of the Company for
the period (taken as one accounting period) from the beginning of the first
fiscal quarter commencing prior to the date of this Indenture to the end of
the Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less 100% of such
deficit), plus (ii) 100% of the aggregate net cash proceeds received by the
Company from the issue or sale since the date of this Indenture of Equity
Interests of the Company or of debt securities of the Company that have been
converted into such Equity Interests (other than Equity Interests (or
convertible debt securities) sold to a Subsidiary of the Company and other
than Disqualified Stock or debt securities that have been converted into
Disqualified Stock), plus (iii) to the extent that any Restricted Investment
that was made after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the cash return of capital
with respect to such Restricted Investment (less the cost of disposition, if
any) and (B) the initial amount of such Restricted Investment.
(A) If (i) no Default or Event of Default has occurred and is
continuing, or would occur as a consequence thereof, and (ii) the voters in
the Louisiana Referendum have approved the continuation of riverboat gaming in
both Bossier Parish and Caddo Parish, Louisiana, or if the voters in the
Louisiana Referendum have disapproved the continuation of riverboat gaming in
one but not the other of both Bossier Parish or Caddo Parish, Louisiana and
the Company has obtained a final, non-appealable determination or decision by
(i) all Gaming Authorities and other applicable governmental regulatory
authorities having jurisdiction over the operations of the Company, including,
without limitation, gaming operations of the Company or (ii) a court of
competent jurisdiction considering such matter or matters, in each case the
effect of which is that the Company is permitted to conduct riverboat gaming
operations at Casino Magic-Bossier City, and (iii) the Company has paid all
Contingent Interest accrued through the Semiannual Period immediately
preceding the Interest Payment Date occurring immediately preceding the date
of such proposed Restricted Payment, the foregoing provisions of the preceding
paragraph shall not prohibit (1) the payment of any dividend within 60 days
after the date of declaration thereof, if at such date of declaration such
payment would have complied with the provisions of this Indenture; (2) the
redemption, repurchase, retirement or other acquisition of any Equity
Interests of the Company in exchange for, or out of the proceeds of, the
substantially concurrent sale (other than to a Subsidiary of the Company) of
other Equity Interests of the Company (other than any Disqualified Stock);
PROVIDED that the amount of any such net cash proceeds that are utilized for
any such redemption, repurchase, retirement or other acquisition shall be
excluded from clause (e) (ii) of the preceding paragraph; (3) the defeasance,
redemption or repurchase of Indebtedness that is PARI PASSU with or
subordinated in right of payment to the Notes with the net cash proceeds from
an incurrence of applicable Permitted Refinancing Indebtedness or the
substantially concurrent sale (other than to a Subsidiary of the Company) of
Equity Interests of the Company (other than Disqualified Stock); PROVIDED that
the amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement or other acquisition shall be excluded from
clause (e) (ii) of the preceding paragraph; (4) the payment of Restricted
Payments not otherwise permitted in an aggregate amount not to exceed $10.0
million; PROVIDED that the Fixed Charge Coverage Ratio for the Company's most
recently ended Reference Period preceding the date on which such Restricted
Payment is made would have been at least 2.5 to 1.0, determined on a pro forma
basis, as if the Restricted Payment had been made at the beginning of such
Reference Period; (5) the payment on a monthly basis of Management Fees to the
Manager pursuant to Section 4.29 in an amount not to exceed 10% of the
Adjusted Consolidated Cash Flow of the Company for the Company's most recently
ended Reference Period; and (6) repurchases by the Company of its outstanding
Capital Stock which are required to be made under applicable Gaming Law;
PROVIDED, HOWEVER, that the declaration of each dividend paid in accordance
with clause (1) above and each payment, redemption or repurchase made under
clauses (4) or (6) shall each be counted for purposes of computing amounts
expended pursuant to clause (e) in the immediately preceding paragraph and (B)
if no Default or Event of Default has occurred and is continuing, or would
occur as a consequence thereof, the forgoing provisions of the preceding
paragraph will not prohibit payments to Casino Magic pursuant to the Tax
Sharing Agreement.
The amount of all Restricted Payments (other than cash) shall be the
fair market value (in the case of any individual Restricted Payment or series
of related Restricted Payments in an amount greater than $100,000), evidenced
by a resolution of the Board of Directors of the Company set forth in an
Officers' Certificate delivered to the Trustee) on the date of the Restricted
Payment of the asset(s) proposed to be transferred by the Company or such
Subsidiary, as the case may be, pursuant to the Restricted Payment. Not less
than once each fiscal quarter, the Company shall deliver to the Trustee an
Officers' Certificate stating that each Restricted Payment made during the
prior fiscal quarter was permitted and setting forth the basis upon which the
calculations required by this Section were computed, which calculations may be
based upon the Company's latest available financial statements.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any
Subsidiary to (a)(i) pay dividends or make any other distributions to the
Company or any of its Subsidiaries (A) on its Capital Stock or (B) with
respect to any other interest or participation in, or measured by, its profits
or (ii) pay any Indebtedness owed to the Company or any of its Subsidiaries,
(b) make loans or advances to the Company or any of its Subsidiaries or (c)
transfer any of its properties or assets to the Company or any of its
Subsidiaries, except for such encumbrances or restrictions existing under or
by reason of (i) this Indenture, the Notes or the Collateral Documents, (ii)
applicable law or (iii) by reason of customary non-assignment provisions in
leases entered into in the ordinary course of business.
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
From and after the Issue Date, the Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, incur,
issue, assume, guaranty or otherwise become directly or indirectly liable,
contingently or otherwise (collectively, "incur"), with respect to any
Indebtedness (including Acquired Debt) and the Company shall not issue any
Disqualified Stock and shall not permit any of its Subsidiaries to issue any
shares of preferred stock or other Disqualified Stock; PROVIDED, HOWEVER, that
so long as no Default or Event of Default has occurred or is continuing the
Company may incur Indebtedness (including Acquired Debt) or issue shares of
Disqualified Stock if:
(i) the Fixed Charge Coverage Ratio of the Company for the
Company's most recently ended Reference Period immediately preceding the date
on which such additional Indebtedness is incurred or such Disqualified Stock
is issued would have been at least 2.5 to 1.0, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom), as if the
additional Indebtedness had been incurred, or the Disqualified Stock had been
issued, as the case may be, at the beginning of such Reference Period; and
(ii) the final maturity of such Indebtedness is beyond the
maturity date of the Notes and the Weighted Average Life to Maturity of such
Indebtedness is greater than the remaining Weighted Average Life to Maturity,
of the Notes.
So long as no Default or Event of Default has occurred and is
continuing, the foregoing provisions shall not apply to:
(i) the incurrence by the Company and its Subsidiaries of
Indebtedness represented by the Notes or a Guarantee or obligations arising
under the Collateral Documents, to the extent that such obligations would
constitute Indebtedness;
(ii) the incurrence by the Company of Permitted Refinancing
Debt in exchange for, or the net proceeds of which are used to extend,
refinance, renew, replace, defease or refund, Indebtedness that was permitted
by this Indenture to be incurred;
(iii) the incurrence by the Company or any of its
Subsidiaries of intercompany Indebtedness between or among the Company and any
of its Substantially Owned Subsidiaries; PROVIDED, HOWEVER, that (A) such
Indebtedness is expressly subordinate to the payment in full of all
Obligations with respect to the Notes, or the Guarantees, as the case may be,
(B)(1) any subsequent issuance or transfer of Equity Interests that results in
any such Indebtedness being held by a Person other than the Company or a
Substantially Owned Subsidiary and (2) any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or a Substantially
Owned Subsidiary shall be deemed, in each case, to constitute an incurrence of
such Indebtedness by the Company or such Subsidiary, as the case may be, and
(C) if any Subsidiary is the obligor on such Indebtedness, such Indebtedness
is represented by a Subsidiary Intercompany Note that is pledged to the
Trustee as security for the Notes;
(iv) the incurrence by the Company of Hedging Obligations
that are incurred for the purpose of fixing or hedging interest rate risk with
respect to any floating rate Indebtedness that is permitted by the terms of
this Indenture to be outstanding;
(v) the incurrence by the Company of Indebtedness (in
addition to Indebtedness permitted by any other clause of this paragraph) in
an aggregate principal amount (or accreted value, as applicable) at any time
outstanding not to exceed $5.0 million;
(vi) the incurrence by the Company of Indebtedness, the
proceeds of which are utilized solely to purchase FF&E; PROVIDED, HOWEVER,
that (A) the principal amount of such Indebtedness does not exceed the cost
(including sales and excise taxes, installation and delivery charges and other
direct costs of, and other direct expenses paid or charged in connection with,
such purchase) of the FF&E purchased with the proceeds thereof and (B) the
aggregate principal amount of such Indebtedness does not exceed $7.5 million
outstanding at any time prior to the opening of the Casino Magic-Bossier City
Hotel and $10.0 million thereafter; and
(vii) the incurrence by the Company of secured Indebtedness
to finance the Project Costs of the Casino Magic-Bossier City Hotel in an
aggregate principal amount at any time outstanding not to exceed 50% of the
aggregate Project Costs of such Casino Magic-Bossier City Hotel if the Fixed
Charge Coverage Ratio of the Company for the Company's most recently ended
Reference Period immediately preceding the date on which such additional
Indebtedness is incurred would have been at least 2.5 to 1.0, determined on a
pro forma basis (including a pro forma application of the net proceeds
therefrom), as if the additional Indebtedness had been incurred at the
beginning of such Reference Period.
SECTION 4.10. ASSET SALES.
The Company shall not, and shall not permit any of its Subsidiaries
to engage in any Asset Sale, unless (i) the Company, or the Subsidiary, as the
case may be, receives consideration at the time of such Asset Sale at least
equal to the fair market value (evidenced by a resolution of the Board of
Directors of the Company set forth in an Officers' Certificate delivered to
the Trustee) of the assets or Equity Interests issued or sold or otherwise
disposed of and (ii) (a) with respect to an Asset Sale of the Crescent City
Riverboat, at least 25% of the consideration received by the Company therefor
is in the form of Cash Equivalents and the remaining consideration is in the
form of Permitted Securities or (b) with respect to an Asset Sale of any other
asset, at least 85% of the consideration received therefor by the Company, or
such Subsidiary is in the form of Cash Equivalents; PROVIDED, HOWEVER, that
the amount of (A) any liabilities (as shown on the Company's or such
Subsidiary's most recent balance sheet or in the notes thereto), of the
Company or any Subsidiary (other than contingent liabilities and liabilities
that are by their terms subordinated in right of payment to the Notes or any
Guarantee thereof) that are assumed by the transferee of any such assets
pursuant to an agreement that releases and indemnifies the Company or such
Subsidiary from further liability with respect thereto and (B) any notes or
other obligations received by the Company or any such Subsidiary from such
transferee that are within 30 days converted by the Company or such Subsidiary
into cash or as to which the Company or such Subsidiary has received at or
prior to the consummation of the Asset Sale a commitment from a nationally
recognized investment, merchant or commercial bank to convert into cash within
90 days of the consummation of such Asset Sale unless not actually converted
into cash within such 90-day period (to the extent of the cash received),
shall be deemed to be Cash Equivalents for purposes of this provision.
Notwithstanding the foregoing, the Company shall not engage in any transfer,
lease, conveyance or disposition, other than a sale, of the Crescent City
Riverboat.
Within 180 days after the receipt by the Company or any of its
Subsidiaries of any Net Proceeds from an Asset Sale, the Company or such
Subsidiary, as the case may be, may (a) apply such Net Proceeds to the making
of a capital expenditure or the acquisition of non-current assets, in either
case, which shall be owned by the Company or such Subsidiary and be used by or
useful to the Company or such Subsidiary in any line of business in which the
Company or such Subsidiary is permitted to be engaged pursuant to Section 4.14
hereof or (b) contractually commit to apply such Net Proceeds to the payment
of the costs of construction of real property improvements, including, without
limitation, to commit to apply Net Proceeds from the sale of the Crescent City
Riverboat to the construction of the Casino Magic-Bossier City Hotel which
improvements shall be owned by the Company or such Subsidiary and be used by
or useful to the Company or such Subsidiary in any line of business in which
the Company or such Subsidiary is permitted to be engaged pursuant to Section
4.14 hereof; PROVIDED HOWEVER, that the Net Proceeds from an Asset Sale of the
Crescent City Riverboat may be applied only to the making of a capital
expenditure or the acquisition of non-current assets or the payment of the
costs of construction of real property improvements, in any case, to be used
by the Company at Casino Magic-Bossier City or the Casino Magic-Bossier City
Hotel; PROVIDED FURTHER, that, in any case, the Company or such Subsidiary, as
the case may be, grants to the Trustee, on behalf of the Holders, a first
priority perfected security interest subject to Permitted Liens on any such
properties or assets acquired or constructed with the Net Proceeds of any such
Asset Sale on the terms set forth in this Indenture and the Collateral
Documents. Pending the final application of any such Net Proceeds, the
Company or such Subsidiary shall invest such Net Proceeds in Cash Equivalents
which shall be pledged to the Trustee as security for the Notes. Any Net
Proceeds from an Asset Sale (other than Net Proceeds from an Asset Sale of the
Crescent City Riverboat) that are not applied or invested as provided in the
first sentence of this paragraph shall be deemed to constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0
million, the Company shall make an Asset Sale Offer to all Holders of Notes to
purchase the maximum principal amount of Notes that may be purchased out of
the Excess Proceeds at an offer price in cash in an amount equal to 101% of
the principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of purchase, which date shall be no less
than 30 or more than 60 days from the date of such Asset Sale Offer, in
accordance with the procedures set forth in Section 3.10 hereof.
Notwithstanding the foregoing, any Net Proceeds of an Asset Sale of the
Crescent City Riverboat (including without limitation, any cash received upon
the conversion or sale of any Permitted Securities or other notes or
obligations received in consideration of such Asset Sale) received prior to
the determination of the outcome of the Louisiana Referendum shall immediately
be deposited in the Escrow Account in which the Trustee shall have a first
priority perfected security interest. If the voters in the Louisiana
Referendum approve the continuation of riverboat gaming in both Bossier Parish
and Caddo Parish, Louisiana, such Net Proceeds shall be released from the
Escrow Account and may be applied by the Company in accordance with the
provisions of the first sentence of this paragraph. If the voters in the
Louisiana Referendum disapprove the continuation of riverboat gaming in
Bossier Parish or Caddo Parish, Louisiana, the Company shall make an Asset
Sale Offer to all Holders of Notes within 90 days after the end of the first
Operating Year to purchase the maximum principal amount of Notes that may be
purchased out of such Net Proceeds at an offer price in cash in an amount
equal to 100% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase,
which date shall be no less than 30 or more than 60 days from the date of such
Asset Sale Offer, in accordance with the procedures set forth in Section 3.10
hereof.
To the extent that the aggregate amount of Notes tendered pursuant
to an Asset Sale Offer is less than the Excess Proceeds, the Company may,
subject to the provisions in this Indenture and the Collateral Documents, use
any remaining Excess Proceeds for any general corporate purpose. If the
aggregate principal amount of Notes surrendered by Holders thereof exceeds the
amount of Excess Proceeds, the Trustee shall select the Notes to be purchased
in the manner set forth in Section 3.10. Upon completion of an Asset Sale
Offer, the amount of Excess Proceeds shall be reset at zero.
SECTION 4.11 EVENT OF LOSS.
Within 360 days after any Event of Loss with respect to any Note
Collateral comprising Casino Magic-Bossier City on the date that it becomes
Operating with a fair market value (or replacement cost, if greater) in excess
of $1.0 million, the Company or the affected Subsidiary of the Company, as the
case may be, may apply the Net Loss Proceeds from such Event of Loss to the
rebuilding, repair, replacement or construction of improvements to Casino
Magic-Bossier City, with no concurrent obligation to make any purchase of any
Notes; PROVIDED that (a) the Company delivers to the Trustee within 90 days of
such Event of Loss a written opinion from a reputable architect that Casino
Magic-Bossier City with at least the Minimum Facilities can be rebuilt,
repaired, replaced, or constructed and Operating within 180 days of such Event
of Loss, (b) an Officers' Certificate certifying that the Company has
available from Net Loss Proceeds or other sources sufficient funds to complete
such rebuilding, repair, replacement or construction, and (c) the Net Loss
Proceeds are less than $25.0 million. If the Net Loss Proceeds to be used for
such rebuilding, repair, replacement or construction exceeds $12.0 million,
then such Net Loss Proceeds shall be deposited in the Construction
Disbursement Account and disbursed in accordance with the Cash Collateral and
Disbursement Agreement. Any Net Loss Proceeds from an Event of Loss with
respect to any Note Collateral comprising Casino Magic-Bossier City on the
date that it becomes Operating that are not reinvested or are not permitted to
be reinvested as provided in the first sentence of this paragraph shall be
deemed "Excess Loss Proceeds." When the aggregate amount of Excess Loss
Proceeds exceeds $10.0 million, the Company shall make an Event of Loss Offer
to all Holders to purchase the maximum principal amount of Notes that may be
purchased out of the Excess Loss Proceeds, at a purchase price in cash in an
amount equal to 100% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase,
which date shall not be less than 30 or more than 60 days from the date of
such Event of Loss Offer, in accordance with the procedures set forth in
Section 3.10 hereof. If the aggregate principal amount of Notes tendered
pursuant to an Event of Loss Offer exceeds the Excess Loss Proceeds, the
Trustee shall select the Notes to be purchased in the manner set forth in
Section 3.10 hereof. To the extent that the aggregate amount of Notes
tendered pursuant to any Event of Loss Offer is less than the Excess Loss
Proceeds, the Company may, subject to the other provisions of this Indenture
and the Collateral Documents, use any remaining Excess Loss Proceeds for
general corporate purposes. Upon completion of any such Event of Loss Offer,
the amount of Excess Loss Proceeds shall be reset at zero. Pending any
permitted rebuilding, repair, replacement or construction or the completion of
any Event of Loss Offer, the Company or the affected Subsidiary, as the case
may be, shall pledge to the Trustee as additional Note Collateral any Net Loss
Proceeds or other cash on hand required for such permitted rebuilding, repair,
replacement or construction pursuant to the terms of the Collateral Documents
relating to Casino Magic-Bossier City. Such pledged funds shall be released
to the Company to pay for or reimburse the Company for the actual cost of such
permitted rebuilding, repair, replacement or construction, or such Event of
Loss Offer, pursuant to the terms of the Collateral Documents relating to
Casino Magic-Bossier City. Pending the final application of the Net Loss
Proceeds, such proceeds shall be invested in Cash Equivalents which shall be
pledged to the Trustee as security for the Notes. The Company or such
Subsidiary shall grant to the Trustee, on behalf of the Holders, a first
priority lien, subject to Permitted Liens, on any properties or assets
rebuilt, repaired, replaced or constructed with such Net Loss Proceeds on the
terms set forth in Section 10.01 hereof and the Collateral Documents.
With respect to any Event of Loss pursuant to clause (iii) of the
definition of "Event of Loss" that has a fair market value (or replacement
cost, if greater) in excess of $5.0 million, the Company (or the affected
Subsidiary, as the case may be), shall be required to receive consideration at
least (i) equal to the fair market value (evidenced by a resolution of the
Board of Directors of the Company set forth in an Officers' Certificate
delivered to the Trustee) of the assets subject to an Event of Loss and (ii)
90% of which is in the form of Cash Equivalents.
SECTION 4.12. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Subsidiaries
to, make any payment to, or sell, lease, transfer or otherwise dispose of any
of its properties or assets to, or purchase any property or assets from, or
enter into or make or amend any contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate (each of the
foregoing, an "AFFILIATE TRANSACTION"), unless (a) such Affiliate Transaction
is on terms that are no less favorable to the Company or the relevant
Subsidiary than those that would have been obtained in a comparable
transaction by the Company or such Subsidiary with an unrelated Person and (b)
the Company delivers to the Trustee (i) with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $1.0 million, a resolution of the Board of
Directors of the Company set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with clause (a) above and that such
Affiliate Transaction has been approved by a majority of the disinterested
members of the Board of Directors of the Company and (ii) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $5.0 million, an opinion as to the
fairness to the Holders of such Affiliate Transaction from a financial point
of view issued by an accounting, appraisal or investment banking firm of
national standing; PROVIDED, HOWEVER, that (i) payments made pursuant to the
Tax Sharing Agreement or the Management Agreement, (ii) any employment or
indemnification agreement entered into by the Company or any of its
Subsidiaries in the ordinary course of business on terms customary in the
gaming industry, (iii) transactions between or among the Company and/or its
Subsidiaries, and (iv) Restricted Payments and Investments permitted under
Section 4.07 hereof shall not be deemed Affiliate Transactions.
SECTION 4.13. LIENS.
From and after the Issue Date, the Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly create, incur,
assume or suffer to exist any Lien on any asset now owned or hereafter
acquired, or any income or profits therefrom or assign or convey any right to
receive income therefrom, except Permitted Liens.
SECTION 4.14. LINE OF BUSINESS.
The Company shall not, and shall not permit any of its Subsidiaries
to, engage in any business or investment activities other than the gaming
business and such business activities as are incidental or related thereto
including, without limitation, related hotel, sports and entertainment
activities and food services, PROVIDED, that such incidental or related
business activities are engaged only at or in conjunction with any Gaming
Facility owned and operated by the Company or any Substantially Owned
Subsidiary of the Company. Notwithstanding any other provision of this
Indenture, the Company shall not, and shall not permit any of its Subsidiaries
to, engage in any business, development or investment activity other than at
or in conjunction with Casino Magic-Bossier city until Casino Magic-Bossier
City is Operating and the Casino Magic-Bossier City Hotel is an Operating
Hotel.
SECTION 4.15. CORPORATE EXISTENCE.
Subject to Article 5 and Article 11 hereof, as the case may be, the
Company and each of the Guarantors shall do or cause to be done all things
necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Subsidiaries, in accordance with the respective organ-izational documents (as
the same may be amended from time to time) of the Company, any such Guarantor
or any such Subsidiary and (ii) the rights (char-ter and statutory), licenses
and franchises of the Company, the Guarantors and their respective
Subsidiaries; PROVIDED, HOWEVER, that the Company and the Guarantors shall not
be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of their respective
Subsidiaries, if the Board of Directors of the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Company, the Guarantors and their respective Subsidiaries, taken as a
whole, and that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
SECTION 4.16. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company
shall make an offer (a "CHANGE OF CONTROL OFFER") to each Holder to repurchase
all or any part (equal to $1,000 or an integral multiple thereof) of each
Holder's Notes at a purchase price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the date of purchase (the "CHANGE OF CONTROL
PAYMENT"). Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder and the Trustee stating: (1) that the Change of
Control Offer is being made pursuant to this Section 4.16 and that all Notes
tendered shall be accepted for payment; (2) the purchase price and the
purchase date, which shall be no later than 30 Business Days from the date
such notice is mailed (the "CHANGE OF CONTROL PAYMENT DATE") unless a later
date is required by applicable law; (3) that any Note not tendered or accepted
for payment will continue to accrue interest; (4) that, unless the Company
defaults in the payment of the Change of Control Payment, all Notes accepted
for payment pursuant to the Change of Control Offer shall cease to accrue
interest after the Change of Control Payment Date; (5) that Holders electing
to have any Notes purchased pursuant to a Change of Control Offer shall be
required to surrender the Notes, with the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Notes completed, or transfer by
book-entry transfer, to the Company, a depositary, if appointed by the Company
or a Paying Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Change of Control Payment
Date; (6) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the expiration of the Change of Control
Offer, a telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Notes delivered for purchase, and
a statement that such Holder is withdrawing his election to have the Notes
purchased; (7) that Holders whose Notes are being purchased only in part shall
be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof; and (8) the circumstances
and relevant facts regarding such Change of Control (including, but not
limited to, information with respect to PRO FORMA historical financial
information after giving effect to such Change of Control, information
regarding the Person or Persons acquiring control and such Person's or
Persons' business plans going forward) and any other information that would be
material to a decision as to whether to tender a Note pursuant to the Change
of Control Offer. The Company shall comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of Notes in connection with a Change of
Control.
(b) On or before the Change of Control Payment Date, the Company
shall, to the extent lawful, (1) accept for payment all Notes or portions
thereof properly tendered pursuant to the Change of Control Offer, (2) deposit
with the Paying Agent an amount equal to the Change of Control Payment in
respect of all Notes or portions thereof so tendered and (3) deliver or cause
to be delivered to the Trustee the Notes so accepted together with an
Officers' Certificate stating the aggregate principal amount of Notes or
portions thereof being purchased by the Company. The Paying Agent shall
promptly mail to each Holder of Notes so tendered payment in an amount equal
to the purchase price for such Notes, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each
Holder a new Note equal in principal amount to any unpurchased portion of the
Notes surrendered by such Holder, if any; PROVIDED, that each such new Note
shall be in a principal amount of $1,000 or an integral multiple thereof. The
Company shall publicly announce the results of the Change of Control Offer on
or as soon as practicable after the Change of Control Payment Date.
(c) The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.6 and repurchases all Notes validly
tendered and not withdrawn under such Change of Control Offer.
SECTION 4.17. LIMITATION ON ISSUANCES AND SALES OF CAPITAL STOCK OF WHOLLY
OWNED SUBSIDIARIES.
Except with respect to transactions in which a Wholly Owned
Subsidiary becomes a Substantially Owned Subsidiary, the Company (i) shall
not, and shall not permit any Wholly Owned Subsidiary of the Company to,
transfer, convey, sell, lease or otherwise dispose of any Capital Stock of any
Wholly Owned Subsidiary of the Company to any Person (other than the Company
or a Wholly Owned Subsidiary of the Company), unless (a) such transfer,
conveyance, sale, lease or other disposition is of all the Capital Stock of
such Wholly Owned Subsidiary and (b) the Net Proceeds from such transfer,
conveyance, sale, lease or other disposition are applied in accordance with
Section 4.10 hereof, and (ii) shall not permit any Wholly Owned Subsidiary of
the Company to issue any of its Equity Interests (other than, if necessary,
shares of its Capital Stock constituting directors' qualifying shares) to any
Person other than to the Company or a Wholly Owned Subsidiary of the Company.
SECTION 4.18. SUBSIDIARY GUARANTEES.
If the Company or any of its Subsidiaries shall, after the date of
this Indenture, acquire or create another Subsidiary, then such newly acquired
or created Subsidiary shall execute a Guarantee, providing for the guarantee
of the obligations under the Notes, this Indenture and the Collateral
Documents on the terms set forth therein, and deliver to the Trustee an
Opinion of Counsel, in form reasonably satisfactory to the Trustee, that such
Guarantee, has been duly executed and delivered and is the valid, binding and
enforceable Obligation of such Subsidiary.
SECTION 4.19. MAINTENANCE OF INSURANCE.
On the Issue Date, and at all times hereafter, the Company shall,
and shall cause each of its Subsidiaries to, maintain insurance with
responsible carriers against such risks and in such amounts as is customarily
carried by similar businesses with such deductibles, retentions, self insured
amounts and coinsurance provisions as are customarily carried by similar
businesses of similar size, including, without limitation, property and
casualty, and, with respect to insurance on the Note Collateral, shall have
provided insurance certificates evidencing such insurance to the Trustee prior
to the Issue Date and shall thereafter provide such certificates prior to the
anniversary or renewal date of each such policy, which certificate shall
expressly state the expiration date for each policy listed. Customary
insurance coverage shall be deemed to include, in addition to any other
specific coverage set forth in the Collateral Documents, the following:
(a) workers' compensation insurance to the extent required to
comply with all applicable state, territorial, or United States laws and
regulations, or the laws and regulations of any other applicable jurisdiction;
(b) comprehensive general liability insurance with minimum
limits of $1.0 million;
(c) umbrella or excess liability insurance providing excess
liability coverages over and above the foregoing underlying insurance policies
up to a minimum limit of $25.0 million;
(d) business interruption insurance (which, with respect to the
Bossier Riverboat, covers reasonable continuing expenses for loss attributable
to the loss or damage to the Bossier Riverboat); and
(e) property insurance protecting the property (including
vessels) against loss or damage by fire, lightning, windstorm, tornado, water
damage, vandalism, riot, earthquake, civil commotion, malicious mischief,
hurricane, and such other risks and hazards as are from time to time covered
by an "all-risk" policy or a property policy covering "special" causes of
loss. Such insurance shall provide coverage in not less than the lesser of
120% of the outstanding principal amount of the Notes plus accrued and unpaid
interest and 100% of actual replacement value (as determined at each policy
renewal based on the X.X. Xxxxx Building Index or some other recognized means)
of any improvements customarily insured consistent with industry standards and
with a deductible no greater than 2% of the insured value of Casino
Magic-Bossier City or such greater amount as is available on commercially
reasonable terms (other than earthquake or flood insurance, for which the
deductible may be up to 10% of such replacement value).
All insurance with respect to the Note Collateral herein required
(except worker's compensation) shall name the Company and the Trustee as
additional insureds or loss payees, as the case may be, with losses in excess
of $10.0 million payable jointly to the Company and the Trustee (unless a
Default or Event of Default has occurred and is then continuing, in which case
all losses are payable solely to the Trustee), with no recourse against the
Trustee for the payment of premiums, deductibles, commissions or club calls,
and for at least 30 days notice of cancellation. All such insurance policies
shall be issued by carriers having an A.M. Best & Company, Inc. rating of A or
higher and a financial size category of not less than X, or if such carrier is
not rated by A.M. Best & Company, Inc., having the financial stability and
size deemed appropriate by an opinion from a reputable insurance broker. The
Company shall deliver to the Trustee on the Issuance Date and each anniversary
thereafter a certificate of an insurance agent stating that the insurance
policies obtained by the Company and its Subsidiaries comply with this Section
4.19 and the related applicable provisions of the Collateral Documents.
SECTION 4.20. LIMITATION ON STATUS AS INVESTMENT COMPANY.
None of the Company or any of the Guarantors shall become subject to
registration as an "investment company" (as that term is defined in the
Investment Company Act of 1940, as amended), or otherwise become subject to
regulation under the Investment Company Act of 1940.
SECTION 4.21. FURTHER ASSURANCES.
The Company shall (and shall cause each of its Subsidiaries to) do,
execute, acknowledge, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing
statements and continuations thereof, termination statements, notices of
assignment, transfers, certificates, assurances and other instruments as may
be required from time to time in order (i) to carry out more effectively the
purposes of the Collateral Documents, (ii) to subject to the Liens created by
any of the Collateral Documents any of the properties, rights or interests
required to be encumbered thereby, (iii) to perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby, and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Trustee any of the
rights granted or nor or hereafter intended by the parties thereto to be
granted to the Trustee or under any other instrument executed in connection
therewith or granted to the Company under the Collateral Documents or under
any other instrument executed in connection therewith.
SECTION 4.22. CONSTRUCTION.
The Company shall cause construction of Casino Magic-Bossier City,
including the furnishing, fixturing and equipping thereof, to be prosecuted
with diligence and continuity in a good and workmanlike manner substantially
in accordance with the Plans and within the Construction Budget. The Company
shall cause Casino Magic-Bossier City to be Operating by the Operating
Deadline.
SECTION 4.23. LIMITATIONS ON USE OF PROCEEDS.
The Company shall cause $20 million of the net proceeds from the
sale of the Notes to be used to purchase the Bossier Riverboat pursuant to the
Vessel Purchase Agreement, free and clear of any Liens, and to grant to the
Trustee for the benefit of the Notes a first priority perfected security
interest in the Bossier Riverboat subject to Permitted Liens. Of the
remaining net proceeds from the sale of the Notes, the Company shall cause
approximately $47.2 million to be deposited in the Cash Collateral Accounts,
including $7.3 million in the Interest Reserve Account, $3.2 million in the
Operating Reserve Account, $31.7 million in the Construction Disbursement
Account, and $5.0 million in the Completion Reserve Account, in each case, to
be disbursed only in accordance with the Cash Collateral and Disbursement
Agreement.
SECTION 4.24. SALE AND LEASEBACK TRANSACTIONS.
The Company shall not, and shall not permit any of its Subsidiaries
to, enter into any sale and leaseback transaction; PROVIDED that the Company
may enter into a sale and leaseback transaction if (a) the Company could have
(i) incurred Indebtedness in an amount equal to the Attributable Debt relating
to such sale and leaseback transaction pursuant to the Fixed Charge Coverage
Ratio test set forth in the first paragraph of Section 4.09 and (ii) incurred
a Lien to secure such Indebtedness pursuant to Section 4.13, (b) the gross
cash proceeds of such sale and leaseback transaction are at least equal to the
fair market value (as determined in good faith by the Board of Directors of
the Company and set forth in an Officers' Certificate delivered to the
Trustee) of the property that is the subject of such sale and leaseback
transaction and (c) the transfer of assets in such sale and leaseback
transaction is permitted by, and the Company applies the proceeds of such
transaction in compliance with, Section 4.10 hereof.
SECTION 4.25. RESTRICTIONS ON PREFERRED STOCK OF SUBSIDIARIES.
The Company shall not permit any of its Subsidiaries to issue any
preferred stock, or permit any Person to own or hold an interest in any
preferred stock of any such Subsidiary, except for preferred stock issued to
the Company or a Wholly Owned Subsidiary of the Company.
SECTION 4.26. PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or is
paid to all Holders of the Notes that consent, waive or agree to amend in the
time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.27. ADVANCES TO SUBSIDIARIES.
All advances (other than equity contributions of not more than
$1,000) to Subsidiaries made by the Company from time to time after the date
of this Indenture shall be evidenced by unsecured Subsidiary Intercompany
Notes in favor of the Company that shall be pledged to the Trustee as Note
Collateral to secure the Notes. Each Subsidiary Intercompany Note shall be
payable upon demand, and shall bear interest at the same rate as the Notes. A
form of Subsidiary Intercompany Note is attached as Exhibit D to this
Indenture. Repayments of principal with respect to any Subsidiary
Intercompany Note may be used by the Company, subject to the other provisions
of this Indenture and the Collateral Documents for any general corporate
purpose.
SECTION 4.28. COLLATERAL DOCUMENTS.
Neither the Company nor any of its Subsidiaries shall amend, waive
or modify, or take or refrain from taking any action that has the effect of
amending, waiving or modifying any provision of the Collateral Documents, to
the extent that such amendment, waiver, modification or action could have an
adverse effect on the rights of the Trustee or the Holders of the Notes;
PROVIDED, that: (i) the Note Collateral may be released or modified as
expressly provided in this Indenture and in the Collateral Documents; (ii) any
Guarantee and pledges may be released as expressly provided in this Indenture
and in the Collateral Documents; and (iii) this Indenture and any of the
Collateral Documents may be otherwise amended, waived or modified as set forth
in Article 9 hereof.
SECTION 4.29. RESTRICTION ON PAYMENT OF MANAGEMENT FEES.
The Company shall not, directly or indirectly, pay to Casino Magic
or any of its Affiliates any Management Fee except pursuant to the Management
Agreement and in accordance with this Indenture, and in the event that the
voters in the Louisiana Referendum do not approve the continuation of
riverboat gaming in Bossier Parish and Caddo Parish, Louisiana, (or, if the
voters in the Louisiana Referendum disapprove the continuation of riverboat
gaming in one but not the other of Bossier Parish or Caddo Parish, Louisiana
until the Company has obtained a final, non-appealable determination or
decision by (i) all Gaming Authorities and other applicable governmental
regulatory authorities having jurisdiction over the operations of the Company,
including, without limitation, gaming operations of the Company, or (ii) a
court of competent jurisdiction considering such matter or matters, in each
case the effect of which is that the Company is permitted to conduct riverboat
gaming operations at Casino Magic-Bossier City), the Company shall not,
directly or indirectly, pay any Management Fee to Casino Magic or any of its
Affiliates. No payment of Management Fees, either current or accrued, shall
be made if at the time of payment of such Management Fees, (i) a Default or an
Event of Default shall have occurred and be continuing or shall occur as a
result thereof or (ii) the Company's Fixed Charge Coverage Ratio for the
Reference Period immediately preceding the date of such payment would have
been less than 1.5 to 1.0 (calculated on a pro forma cash basis after only
deducting such fees to the extent paid in cash and not deferred for such
period including any fees deferred from a prior period to be paid in cash
during such period and not deducting any such fees to the extent deferred and
not paid in cash during such period). Any Management Fees not permitted to be
paid pursuant to this Section 4.29 shall be deferred and shall accrue and may
be paid only at such time that they would otherwise be permitted to be paid
hereunder. The right to receive payment of the Management Fee shall be
subordinate in right of payment to the right of the Holders of the Notes to
receive payment pursuant to the Notes. The terms of the Management Agreement
shall not be amended to increase amounts to be paid thereunder, or in any
other manner which would be adverse to the Company or the Holders of the
Notes, including without limitation, to amend the requirement that the
Management Fee payable thereunder be based on the Company's Adjusted
Consolidated Cash Flow; PROVIDED, HOWEVER, that the foregoing shall not
prohibit any amendment required under any Gaming Law or by any Gaming
Authority.
SECTION 4.30. LIMITATION ON ACTIVITIES OF JEFFERSON.
So long as any of the Notes are outstanding, Jefferson Corp. shall
not conduct any business or investment activities whatsoever (including
without limitation, issuing any Equity Interests, making any Investments,
incurring any Indebtedness or making payments or taking any actions) other
than: (a) to hold its Investment in the Company, (b) to be a Guarantor under
the Indenture and to do all things necessary or incident thereto, including
without limitation, to comply with its obligations under this Indenture and
the Collateral Documents, (c) to make payments, dividends, or distributions to
Casino Magic from funds or property received by Jefferson Corp. from the
Company in accordance with the terms of the Indenture, and (c) otherwise exist
as a subsidiary of Casino Magic acting as a holding company of the Company,
including all activities incidental or related to any the foregoing, including
without limitation, (i) performing its obligations under the Tax Sharing
Agreement, (ii) receiving funds from Casino Magic in the form of capital
contributions which such funds may be contributed as a capital contribution to
the Company, (iii) owning and voting the capital stock of the Company, and
(iv) preparing financial statements and other reports.
ARTICLE 5
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company shall not consolidate or merge with or into (whether or
not the Company is the surviving corporation) or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions to, another
corporation, Person or entity unless (i) the Company is the surviving
corporation or the entity or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized or existing under the laws of the United
States, any state thereof or the District of Columbia, (ii) the entity or
Person formed by or surviving any such consolidation or merger (if other than
the Company) or the entity or Person to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Notes, this Indenture and the Collateral
Documents pursuant to a supplemental indenture or other documents or
instruments in a form reasonably satisfactory to the Trustee, (iii)
immediately after such transaction, no Default or Event of Default exists,
(iv) such transaction would not result in the loss or suspension or material
impairment of any Gaming License unless a comparable replacement Gaming
License is effective prior to or simultaneous with such loss, suspension or
material impairment; (v) except in the case of a merger of the Company with or
into a Wholly Owned Subsidiary of the Company, the Company or the entity or
Person formed by or surviving any such consolidation or merger (if other than
the Company), or to which such sale, assignment, transfer, lease, conveyance
or other disposition shall have been made (A) shall have Consolidated Net
Worth (immediately after the transaction) equal to or greater than the
Consolidated Net Worth of the Company immediately preceding the transaction,
(B) shall, upon the consummation of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of
the applicable Reference Period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in the first paragraph of Section 4.09 hereof and (C) shall have a Fixed
Charge Coverage Ratio for the Reference Period immediately preceding the date
on which such transaction occurred, determined on a pro forma basis (including
a pro forma application of the proceeds therefrom) as if such transaction had
occurred at the beginning of such Reference Period, that is no less than 85%
of the Company's or such Person's Fixed Charge Coverage Ratio for such period
prior to giving effect to such transaction; and (vi) such transaction would
not require any Holder or beneficial owner of Notes to obtain a Gaming License
or be qualified or found suitable under the law of any applicable gaming
jurisdiction; PROVIDED, that such Holder or beneficial owner would not have
been required to obtain a Gaming License or be qualified or found suitable
under the laws of any applicable gaming jurisdiction in the absence of such
transaction.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substan-tially all of the
assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation and not to the Company), and may
exercise every right and power of the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
PROVIDED, HOWEVER, that (i) the Company has delivered to the Trustee an
Officers' Certificate and Opinion of Counsel, subject to customary assumptions
and exclusions, stating that the proposed transaction complies with this
Indenture and (ii) the predecessor Company shall not be relieved from the
obligation to pay the principal of and interest on the Notes except in the
case of a sale of all of the Company's assets that meets the requirements of
Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company or any Guarantor defaults in the payment
when due of interest, including Contingent Interest on, or Liquidated Damages,
if any, with respect to, the Notes or any Guarantee and such default continues
for a period of 30 days PROVIDED, that payments of Contingent Interest that
are permitted to be deferred as provided in the Notes will not become due for
this purpose until such payment is required to be made pursuant to the terms
of the Notes;
(b) the Company defaults in the payment when due of
principal of or premium, if any, on the Notes when the same becomes due and
payable at maturity, upon redemption (including in connection with an offer to
purchase) or otherwise;
(c) the Company fails to comply with any of the provisions
of Sections 3.09, 4.07, 4.09, 4.10, 4.11, 4.16, 4.23 or 5.01 hereof or
Sections 3.01, 3.05, 3.08, 3.11, 3.12 or 3.13 of the Bossier Riverboat
Mortgage or the Crescent City Riverboat Mortgage;
(d) the Company or a Guarantor fails to comply with any of
its other covenants or agreements in, or provisions of, this Indenture or the
Notes for the period and after the notice specified below;
(e) a default occurs under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Subsidiaries (or the payment of which is guaranteed by the Company or any of
its Subsidiaries), whether such Indebtedness or guarantee now exists, or is
created after the date of this Indenture, which default (i) is caused by a
failure to pay principal of or premium, if any, or interest on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default") or (ii) results
in the acceleration of such Indebtedness prior to its express maturity and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$5.0 million or more;
(f) a final judgment or final judgments for the payment of
money are entered by a court or courts of competent jurisdiction against the
Company or any of its Subsidiaries and such judgment or judgments remain
unpaid, and undischarged or unstayed for a period of 60 days, PROVIDED that
the aggregate of all such unpaid and undischarged judgments exceeds $5.0
million;
(g) (i) the Company or any Guarantor (w) breaches any
material representation or warranty set forth in the Collateral Documents, (x)
fails to comply with any covenant set forth in the Collateral Documents
requiring the payment of money for three Business Days after notice to comply,
(y) fails to comply with any other covenant set forth in the Collateral
Documents for 30 days after notice to comply, or (z) repudiates its
obligations under the Collateral Documents or (ii) the Collateral Documents
become unenforceable against the Company or any Guarantor for any reason;
(h) the Company, any Guarantor, any Significant Subsidiary
of the Company or any group of Subsidiaries of the Company that, taken as a
whole, would constitute a Significant Subsidiary pursuant to or within the
meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become
due;
(i) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company, any Guarantor,
any Significant Subsidiary of the Company or any group of Subsidiaries of the
Company that, taken as a whole, would constitute a Significant Subsidiary in
an involuntary case;
(ii) appoints a Custodian of the Company, any
Guarantor, any Significant Subsidiary of the Company or any group of
Subsidiaries of the Company that, taken as a whole, would constitute a
Significant Subsidiary or for all or substantially all of the property of the
Company, any Guarantor, or any Significant Subsidiary of the Company or any
group of Subsidiaries of the Company that, taken as a whole, would constitute
a Significant Subsidiary; or
(iii) orders the liquidation of the Company, any
Guarantor, any Significant Subsidiary of the Company or any group of
Subsidiaries of the Company that, taken as a whole, would constitute a
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days; or
(j) the Company or any of its Subsidiaries ceases or
suspends gaming operations for a period of more than 90 consecutive days at
any Gaming Facility as the result of any Gaming License being revoked,
terminated, suspended or otherwise ceasing to be effective;
(k) Casino Magic-Bossier City is not Operating by the
Operating Deadline;
(l) Casino Magic-Bossier City does not remain Operating
after becoming Operating, except as the hours of operation of Casino
Magic-Bossier City may be limited by any Gaming Authority or Gaming Law, or
due to the occurrence of an Event of Loss (so long as the Company is in
compliance with Section 4.11 hereof), or due to the occurrence of a force
majeure event which is not cured within 10 days; or
(m) any Guarantee is held in any judicial proceeding to be
unenforceable or invalid or ceases for any reason to be in full force and
effect or any Guarantor, or any Person acting on behalf of any Guarantor,
denies or disaffirms its obligations under its Guarantee (except as permitted
by the Indenture).
A Default under clause (d) is not an Event of Default until the Trustee
notifies the Company, or the Holders of at least 25% in principal amount of
the then outstanding Notes notify the Company and the Trustee, of the Default
and the Company does not cure the Default within 30 days after receipt of the
notice. The notice must specify the Default, demand that it be remedied and
state that the notice is a "Notice of Default."
SECTION 6.02. ACCELERATION.
If any Event of Default (other than an Event of Default specified in
clause (h) or (i) of Section 6.01) hereof occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately
by a notice in writing to the Company and the Guarantors (and to the Trustee
if given by the Holders). Upon any such declaration, the Notes shall become
due and payable immediately. Notwithstanding the foregoing, if an Event of
Default specified in clause (h) or (i) of Section 6.01 hereof occurs, all
outstanding Notes shall be due and payable immediately without further action
or notice. The Holders of a majority in aggregate principal amount of the
then outstanding Notes by written notice to the Trustee may on behalf of all
of the Holders rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium that has become
due solely because of the acceleration) have been cured or waived.
If an Event of Default occurs on or after August 15, 2000 by reason
of any willful action (or inaction) taken (or not taken) by or on behalf of
the Company with the intention of avoiding payment of the premium that the
Company would have had to pay if the Company then had elected to redeem the
Notes pursuant to Section 3.07 hereof, an equivalent premium shall also become
and be immediately due and payable to the extent permitted by law upon the
acceleration of the Notes, anything in this Indenture or in the Notes to the
contrary notwithstanding. If an Event of Default occurs prior to August 15,
2000, by reason of any willful action (or inaction) taken (or not taken) by or
on behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes prior to such date, then, upon acceleration of the
Notes, an additional premium shall also become and be immediately due and
payable in an amount, for each of the years beginning on August 15 of the
years set forth below, as set forth below (expressed as a percentage of the
principal amount that would otherwise be due but for the provisions of this
sentence):
YEAR PERCENTAGE
1996 113.000%
1997 111.375%
1998 109.750%
1999 108.125%
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision
of the Notes, this Indenture, the Guarantees or any Collateral Document.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquies-cence in the Event of Default. All
remedies are cumulative to the extent permitted by law.
SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(PROVIDED, HOWEVER, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration). Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture, the Notes and the Collateral Documents; but
no such waiver shall extend to any subsequent or other Default or impair any
right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or
power con-ferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee
determines may be unduly prejudicial to the rights of other Holders of Notes
or that may involve the Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of
a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee a
direction incon-sistent with the request; PROVIDED, HOWEVER, that the
foregoing provision does not affect the right of a Holder to xxx for
enforcement of any overdue payment on the Notes.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due
dates expressed in the Note (including in connection with an offer to
purchase), or to bring suit for the enforcement of any such payment on or
after such respective dates, shall not be impaired or affected without the
consent of such Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs
and is continuing, the Trustee is authorized to recover judgment in its own
name and as trustee of an express trust against the Company or any Guarantor
for the whole amount of principal of, premium and Liquidated Damages, if any,
and interest remaining unpaid on the Notes and interest on overdue principal
and, to the extent lawful, interest and such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disburse-ments and advances of the Trustee, its agents and counsel)
and the Holders of the Notes allowed in any judicial proceedings relative to
the Company (or any other obligor upon the Notes, including the Guarantors-),
its creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on
any such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the
event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof.
To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any
plan of reorganization or arrangement or otherwise. Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
FIRST: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
SECOND: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
THIRD: to the Company, the Guarantors or to such party as a court
of competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment
to Holders of Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reason-able costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
SECTION 6.12. MANAGEMENT OF CASINOS.
Notwithstanding any provision of this Article 6 to the contrary,
following an Event of Default that permits the taking of possession of any
casino that constitutes Note Collateral by the Trustee or the appointment of a
receiver of either such Note Collateral or any part thereof, or after such
taking of possession or such appointment, the Trustee or any such receiver
shall be authorized, in addition to the rights and powers of the Trustee and
such receiver set forth elsewhere in this Indenture and the Collateral
Documents, to retain one or more experienced operators of casinos to manage
such casino on behalf of the Holders of Notes; PROVIDED, HOWEVER, that any
such operator shall have all necessary legal qualifications, including all
Gaming Licenses to manage such casino.
ARTICLE 7
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and the Collateral Documents, and use the same degree of care and
skill in its exercise, as a prudent man would exercise or use under the
circum-stances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Collateral Documents and the
Trustee need perform only those duties that are specifically set forth in this
Indenture and the Collateral Documents and no others, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture and the
Collateral Documents. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of this
Indenture and the Collateral Documents.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph
(b) of this Section 7.01;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Inden-ture that in any way relates to the Trustee is subject
to paragraphs (a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability in the performance of its
duties hereunder, under any Collateral Document, in the exercise of any right
or power hereunder or under any Collateral Document if it shall have
reasonable grounds for believing that repayment of funds or adequate indemnity
against such risk or liability is not reasonably assured to it. The Trustee
shall be under no obligation to exercise any of its rights and powers under
this Indenture at the request of any Holders, unless such Holder shall have
offered to the Trustee security and indemnity satisfactory to it against any
loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) The Trustee shall not be personally liable for debts
contracted or liabilities or damages incurred in the management or operation
of the Note Collateral in case of entry upon the premises or otherwise unless
due to the Trustee's negligence, willful misconduct or bad faith.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed
by it to be genuine and to have been signed or presented by the proper Person.
The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate or Opinion of Counsel. The
Trustee may consult with counsel and the written advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection
from liability in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company or any Guarantor
shall be sufficient if signed by an Officer of the Company or such Guarantor.
(f) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may other-wise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee is also subject to Sections 7.10 and
7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes or any
Collateral Document or Guarantee, it shall not be accountable for the
Company's use of the proceeds from the Notes or any money paid to the Company
or upon the Company's direction under any provision of this Indenture, it
shall not be responsible for the use or application of any money received by
any Paying Agent other than the Trustee, and it shall not be responsible for
any statement or recital herein or any statement in the Notes or any other
document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it
is known to a Responsible Officer of the Trustee, the Trustee shall mail to
Holders of Notes a notice of the Default or Event of Default within 90 days
after it occurs. Except in the case of a Default or Event of Default in
pay-ment of principal of, premium, if any, or interest on any Note, the
Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is
in the interests of the Holders of the Notes.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
(a) Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA 313(a) (but if no
event described in TIA 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee
also shall comply with TIA 313(b)(2). The Trustee shall also transmit by
mail all reports as required by TIA 313(c).
(b) A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the SEC and
each stock exchange on which the Notes are listed in accordance with TIA
313(d). The Company shall promptly notify the Trustee when the Notes are
listed on any stock exchange.
(c) At the expense of the Company, the Trustee or, if the
Trustee is not the Registrar, the Registrar, shall report the names of record
holders of the Notes to any Gaming Authority when requested to do so by the
Company.
(d) At the express direction of the Company and at the Company's
expense, the Trustee shall provide any Gaming Authority with:
(i) copies of all notices, reports and other written
communications which the Trustee gives to Holders;
(ii) a list of all of the Holders promptly after the
original issuance of the Notes and periodically thereafter if the Company so
directs;
(iii) notice of any Default under this Indenture, any
acceleration of the Indebtedness evidenced hereby, the institution of any
legal actions or proceedings before any court or governmental authority in
respect of a Default or Event of Default hereunder;
(iv) notice of the removal or resignation of the Trustee
within five Business Days of the effectiveness thereof;
(v) notice of any transfer or assignment of rights under
this Indenture or the Guarantees known to the Trustee within five Business
Days thereof; and
(vi) a copy of any amendment to the Notes or this Indenture
within five Business Days of the effectiveness thereof.
(e) To the extent requested by the Company and at the Company's
expense, the Trustee shall cooperate with any Gaming Authority in order to
provide such Gaming Authority with the information and documentation requested
and as otherwise required by applicable law.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensa-tion shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred
or made by it in addition to the compensation for its services. Such expenses
shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel, except to the extent attributable to the
Trustee's negligence, willful misconduct or bad faith.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with
the acceptance or administration of its duties under this Indenture or any
Collateral Document, including the costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) or enforcing any
Collateral Document or Guarantee and defending itself against any claim
(whether asserted by the Company or any Holder or any other Person) or
liability in connection with the exercise or performance of any of its powers
or duties hereunder, except to the extent any such loss, liability or expense
may be attributable to its negligence, willful misconduct or bad faith. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Company shall not relieve
the Company of its obligations hereunder. The Company shall defend the claim
and the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section 7.07,
the Trustee shall have a Lien prior to the Notes on the Note Collateral and on
all money or property held or collected by the Trustee, except that held in
trust to pay principal and interest on particular Notes. Such Lien shall
survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(h) or (i) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administra-tion
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA 313(b)(2) to
the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appoint-ment of a
successor Trustee shall become effective only upon compliance with applicable
Gaming Laws, if any, and upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Notes of
a majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company
may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a Custodian or public officer takes charge of the Trustee or
its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the then outstanding Notes
may appoint a successor Trustee to replace the successor Trustee appointed by
the Company.
If any Gaming Authority requires a Trustee to be approved, licensed
or qualified and the Trustee fails or declines to do so, such approval,
license or qualification shall be obtained upon the request of, and at the
expense of, the Company unless the Trustee declines to do so, or, if the
Trustee's relationship with either the Company or the Guarantors may, in the
Company's discretion, jeopardize any material gaming license or franchise or
right or approval granted thereto, the Trustee shall resign, and, in addition,
the Trustee may at its option resign if the Trustee in its sole discretion
determines not to be so approved, licensed or qualified.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Hold-er of a Note who
has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appoint-ment of a
successor Trustee.
A successor Trustee shall deliver a written accept-ance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, PROVIDED
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee, provided such corporation shall be otherwise eligible and
qualified under this Article 7.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States
of America or of any state thereof that is authorized under such laws to
exercise corporate trustee power, that is subject to supervision or
examination by federal or state authorities and that has a combined capital
and surplus of at least $100 million as set forth in its most recent published
annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA 310(a)(1), (2) and (5). The Trustee is subject to TIA
310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA 311(a), excluding any creditor
relationship listed in TIA 311(b). A Trustee who has resigned or been
removed shall be subject to TIA 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced
by a resolution set forth in an Officers' Certificate delivered to the
Trustee, at any time, elect to have either Section 8.02 or 8.03 hereof be
applied to all outstanding Notes upon compliance with the conditions set forth
below in this Article 8.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
deemed to have been discharged from their obligations with respect to all
outstanding Notes and the Collateral Documents on the date the conditions set
forth below are satisfied (hereinafter, "LEGAL DEFEASANCE"). For this
purpose, Legal Defeasance means that the Company shall be deemed to have paid
and discharged the entire Indebtedness represented by the outstanding Notes,
which shall thereafter be deemed to be "outstanding" only for the purposes of
Section 8.05 hereof and the other Sections of this Indenture referred to in
(a) and (b) below, and to have satisfied all its other obligations under such
Notes and this Indenture (and the Trustee, on demand of and at the expense of
the Company, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to
receive solely from the trust fund described in Section 8.04 hereof, and as
more fully set forth in such Section, payments in respect of the principal of,
premium, if any, and interest and Liquidated Damages, if any, on such Notes
when such payments are due, (b) the Company's and any Guarantor's obligations
with respect to such Notes under Article 2 and Section 4.02 hereof, (c) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Company's obligations in connection therewith, including, without limitation,
its obligations under Section 7.07 hereof, and (d) this Article 8. Subject to
compliance with this Article 8, the Company may exercise its option under this
Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from their obligations under the covenants contained in Sections
4.03, 4.04, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16, 4.17, 4.18,
4.19, 4.20, 4.21, 4.22, 4.23, 4.24, 4.25, 4.26, 4.27, 4.28, 4.29, and 5.01 and
Articles 10 and 11 hereof with respect to the outstanding Notes on and after
the date the conditions set forth below are satisfied (hereinafter, "COVENANT
DEFEASANCE"), and the Notes shall thereafter be deemed not "outstanding" for
the purposes of any direction, waiver, consent or declaration or act of
Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed "outstanding" for all other
purposes hereunder (it being understood that such Notes shall not be deemed
outstanding for accounting purposes). For this purpose, Covenant Defeasance
means that, with respect to the outstanding Notes, the Company and the
Guarantors may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any
such covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall
not constitute a Default or an Event of Default under Section 6.01 hereof,
but, except as specified above, the remainder of this Indenture and such Notes
shall be unaffected thereby. In addition, upon the Company's exercise under
Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, Sections 6.01(c) through 6.01(g) and 6.01(j) through 6.01(m) hereof
shall not constitute Events of Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee,
in trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such amounts
as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any, and
interest and Liquidated Damages, if any, on the outstanding Notes on the
stated date for payment thereof or on the applicable redemption date, as the
case may be, and the Company must specify whether the Notes are being defeased
to maturity or to a particular redemption date;
(b) in the case of an election under Section 8.02 hereof,
the Company shall have delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that (A) the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of this Indenture, there has
been a change in the applicable federal income tax law, in either case to the
effect that, and based thereon such Opinion of Counsel shall confirm that, the
Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Legal Defeasance had not
occurred;
(c) in the case of an election under Section 8.03 hereof,
the Company shall have delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Covenant Defeasance had not
occurred;
(d) no Default or Event of Default shall have occurred and
be continuing on the date of such deposit (other than a Default or Event of
Default resulting from the incurrence of Indebtedness all or a portion of the
proceeds of which will be used to defease the Notes pursuant to this Article 8
concurrently with such incurrence) or insofar as Sections 6.01(h) or 6.01(i)
hereof is concerned, at any time in the period ending on the 91st day after
the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to which the
Company or any of its Subsidiaries is a party or by which the Company or any
of its Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that after the 91st day following the
deposit, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally and that the Trustee has a perfected security interest in the
trust for the ratable benefit of the Holders of the Notes;
(g) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company
with the intent of preferring the Holders over any other creditors of the
Company or with the intent of defeating, hindering, delaying or defrauding any
other creditors of the Company; and
(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this
Section 8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest and Liquidated Damages, if any, but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the
principal and interest received in respect thereof other than any such tax,
fee or other charge which by law is for the account of the Holders of the
outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
SECTION 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium or
Liquidated Damages, if any, or interest on any Note and remaining unclaimed
for two years after such principal, and premium or Liquidated Damages, if any,
or interest has become due and payable shall be paid to the Company on its
request or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Note shall thereafter, as an unsecured creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; PROVIDED, HOWEVER, that the
Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in
The New York Times or The Wall Street Journal (national edition), notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such notification or
publication, any unclaimed balance of such money then remaining shall be
repaid to the Company.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02
or 8.03 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's and the Guarantors'
obligations under this Indenture, the Notes and the Guarantees shall be
revived and reinstated as though no deposit had occurred pursuant to Section
8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; PROVIDED, HOWEVER, that, if the Company or any
Guarantor makes any payment of principal of, premium or Liquidated Damages, if
any, or interest on any Note following the reinstatement of its obligations,
the Company or such Guarantor, as the case may be, shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money
held by the Trustee or Paying Agent.
SECTION 8.08. NOTE COLLATERAL.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to either Section 8.02 or 8.03, the Note Collateral, except the
funds in the trust fund described in Section 8.04 hereof, shall be released
pursuant to Section 10.03 hereof.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the Notes,
the Guarantees or the Collateral Documents without the consent of any Holder
of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or
in place of certificated Notes;
(c) to provide for the assumption of the Company's or any
Guarantor's obligations to the Holders of the Notes in the case of a merger or
consolidation pursuant to Article 5 or Article 11 hereof;
(d) to make any change that would provide any additional
rights or benefits to the Holders of the Notes (including providing for
additional Guarantees pursuant to this Indenture) or that does not, with
respect to an amendment or supplement to the Indenture, adversely affect the
legal rights hereunder of any such Holder of Notes or, with respect to an
amendment or supplement to any Collateral Document, adversely affect the legal
rights thereunder of any such Holder of Notes;
(e) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under the TIA;
(f) to provide for a successor Trustee in accordance with
the terms of the Indenture; or
(g) to enter into additional or supplemental Collateral
Documents.
Upon the request of the Company and the Guarantors accompanied by a
resolution of the Company's Board of Directors authorizing the execution of
any such amended or supple-mental Indenture, Notes, Guarantees or Collateral
Documents and upon receipt by the Trustee of the documents described in
Section 9.06 hereof, the Trustee shall join with the Company and the
Guarantors in the execution of any amended or supple-mental Indenture, Notes,
Guarantees or Collateral Documents authorized or permitted by the terms of
this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supple-mental Indenture, Notes,
Guarantees or Collateral Documents that affects its own rights, duties or
immunities under this Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture (including
Section 3.10, 4.10, 4.11 and 4.16 hereof), the Notes, the Guarantees or the
Collateral Documents with the consent of the Holders of at least a majority in
principal amount of the Notes then outstanding (including consents obtained in
connection with a tender offer or exchange offer for the Notes), and, subject
to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default
(other than a Default or Event of Default in the payment of the principal of,
premium or Liquidated Damages, if any, or interest on the Notes, except a
payment default resulting from an acceleration that has been rescinded) or
compliance with any provision of this Indenture, the Notes, the Guarantees or
the Collateral Documents may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including consents
obtained in connection with a tender offer or exchange offer for the Notes).
Without consent of at least 66 2/3% in aggregate principal amount of the Notes
then outstanding (including consents obtained in connection with a tender
offer or exchange offer for such Notes), no waiver or amendment to this
Indenture may make any change in the provisions of Section 4.10 or 4.16
hereof. Without the consent of the Holders of at least 85% in aggregate
principal amount of the Notes then outstanding, an amendment or waiver may not
affect the Liens in favor of the Trustee and the Holders of the Notes created
under the Collateral Documents in a manner adverse to the Holders (other than
pursuant to the release of Note Collateral in accordance with the provisions
of the Indenture and of the applicable Collateral Documents) or release all or
substantially all of the Note Collateral.
Upon the request of the Company accompanied by a resolution of the
Board of Directors of the Company and the Guarantors authorizing the execution
of any such amended or supple-mental Indenture, Notes, Guarantees or
Collateral Documents and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 9.06 hereof, the Trustee shall join with the Company and the
Guarantors in the execution of such amended or supplemental Indenture, Notes,
Guarantees or Collateral Documents unless such amended or supplemental
Indenture, Notes, Guarantees or Collateral Documents affects the Trustee's
own rights, duties or immunities under this Indenture, Notes, Guarantees or
Collateral Documents or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture, Notes, Guarantees or Collateral Documents.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture, Notes, Guarantees or Collateral Documents or waiver. Subject to
Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate
principal amount of the Notes then outstanding may waive compliance in a
particular instance by the Company with any provision of this Indenture, the
Notes, the Guarantees or the Collateral Documents. However, without the
consent of each Holder affected, an amendment or waiver may not (with respect
to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any
Note or alter or waive any of the provisions with respect to the redemption of
the Notes except as provided above with respect to Sections 4.10 and 4.16
hereof;
(c) reduce the rate of or change the time for payment of
interest, including default interest, on any Note;
(d) waive a Default or Event of Default in the payment of
principal of or premium or Liquidated Damages, if any, or interest on the
Notes (except a rescission of acceleration of the Notes by the Holders of at
least a majority in aggregate principal amount of the then outstanding Notes
and a waiver of the payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated
in the Notes;
(f) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of or premium or Liquidated Damages, if any, or
interest on the Notes; or
(g) waive a redemption payment with respect to any Note
(other than payments required by Sections 4.10, 4.11 or 4.16 hereof);
(h) make any change in Section 6.04 or 6.07 hereof or in
the foregoing amendment and waiver provisions.
The right of any Holder to participate in any consent required or
sought pursuant to any provision of this Indenture (and the obligations of the
Company to obtain any such consent otherwise required from such Holder) may be
subject to the requirements that such Holder shall have been the Holder of
record of any Notes with respect to which such consent is required to be
sought as of a date identified by the Trustee in a notice furnished to Holders
in accordance with the terms of this Indenture.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture, the Notes, the
Guarantees or the Collateral Documents- shall be set forth in a amended or
supplemental Indenture, Note, Guaranty or Collateral Document that complies
with the TIA as then in effect. This Indenture shall be construed to comply
in every respect with the TIA.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent
Holder of a Note may revoke the consent as to its Note if the Trustee receives
written notice of revocation before the date the waiver, supplement or
amendment becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall authenticate new Notes
(accompanied by a notation of the Guarantees duly endorsed by the Guarantors)
that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture, Note,
Guarantee, or Collateral Document, if necessary, authorized pursuant to this
Article Nine if the amendment or supplement does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. The Company or any
Guarantor may not sign an amendment or supplemental Indenture, Note,
Guarantee, or Collateral Document until its Board of Directors approves it.
In executing any amended or supplemental Indenture, Note, Guarantee, or
Collateral Document, the Trustee shall be entitled to receive and (subject to
Section 7.01) shall be fully protected in relying upon, an Officer's
Certificate and an Opinion of Counsel stating that the execution of such
amended or supplemental indenture, Note, Guarantee, or Collateral Document is
authorized or permitted by this Indenture.
ARTICLE 10
COLLATERAL AND SECURITY
SECTION 10.01. SECURITY.
(a) The due and punctual payment of the principal of, premium
and Liquidated Damages, if any, and interest on all of the Notes when and as
the same shall be due and payable, whether on an Interest Payment Date, at
maturity, by acceleration, repurchase, redemption or otherwise, and (to the
extent permitted by law) interest on the overdue principal of, premium and
Liquidated Damages, if any, and performance of all other obligations of the
Company and the Guarantors to the Holders of Notes or the Trustee under this
Indenture and the Notes and the Guarantees, according to the terms hereunder
or thereunder, shall be ratably secured by a Lien on the Note Collateral owned
by the Company and each Guarantee similarly shall be secured as provided in
the Collateral Documents that the Company and the Guarantors have entered into
on or prior to the Issue Date for the benefit of the Holders of Notes.
(b) Each Holder of Notes, by its acceptance thereof, consents
and agrees to the terms of the Collateral Documents (including, without
limitation, the provisions providing for foreclosure and release of Note
Collateral) as the same may be in effect or may be amended from time to time
in accordance with its terms and authorizes and directs the Trustee to enter
into the Collateral Documents and to perform its obligations and exercise its
rights thereunder in accordance therewith. The Company and the Guarantors
shall deliver to the Trustee copies of all documents executed pursuant to this
Indenture and the Collateral Documents and shall do or cause to be done all
such acts and things as may be necessary or proper, or as may be required by
the provisions of the Collateral Documents to assure and confirm to the
Trustee the security interest in the Note Collateral and contemplated hereby,
by the Collateral Documents or any part thereof, as from time to time
constituted, so as to render the same available for the security and benefit
of this Indenture and of the Notes and the Guarantees secured hereby,
according to the intent and purposes herein expressed.
(c) The Company shall take, or shall cause its Subsidiaries to
take any and all actions reasonably required to create and maintain, as
security for the Obligations of the Company or the respective Guarantors
hereunder, valid and enforceable perfected first priority Liens in and on all
the Note Collateral in favor of the Trustee for the benefit of the Holders,
superior to and prior to the rights of all third Persons and subject to no
Liens other than Permitted Liens. Notwithstanding the foregoing or anything
to the contrary in the Collateral Documents, nothing in this Indenture or the
Collateral Documents shall require the Company or any Guarantor to do (or
cause to be done) any of the following: (i) create or perfect Liens in any
assets otherwise excluded from the Note Collateral pursuant to the terms of
the Collateral Documents, or (ii) perfect Liens in any of the following: (A)
any personal property a security interest in which must be perfected by
delivery thereof to the Trustee, if delivery thereof is not required by the
Collateral Documents, (B) any automobiles or other assets (other than vessels)
subject to a certificate of title or registration, except as required by the
Collateral Documents, and (C) any deposit accounts other than the Cash
Collateral Accounts.
(d) The Net Proceeds of all Asset Sales and the Net Loss
Proceeds from Events of Loss of assets constituting Note Collateral, as well
as Excess Proceeds and Excess Loss Proceeds, shall be promptly and without any
commingling deposited with the Trustee subject to a Lien in favor of the
Trustee for the benefit of the Holders of the Notes unless and until applied
as permitted under Section 4.10 or 4.11 hereof. The Trustee shall release to
the Company any Excess Proceeds and Excess Loss Proceeds that remain after
making an offer to purchase the Notes in compliance with Section 3.10 hereof.
Amounts so paid to the Trustee shall be invested or released in accordance
with the provisions of this Indenture.
(e) The Trustee may appoint one or more collateral agents, who
may be delegated any one or more of the duties or rights of the Trustee under
the Collateral Documents or that are specified in any of the Collateral
Documents.
SECTION 10.02. RECORDING AND OPINIONS.
(a) The Company and the Guarantors shall cause the applicable
Collateral Documents including the Mortgage, the Bossier Riverboat Mortgage
and the Crescent City Mortgage and any financing statements, all amendments or
supplements to each of the foregoing and any other similar security documents
as necessary, to be registered, recorded and filed and/or re-recorded,
re-filed and renewed in such manner and in such place or places, if any, as
may be required by law or reasonably requested by the Trustee in order fully
to preserve and protect (i) the Liens securing the obligations under the Notes
and the Guarantees pursuant to the Collateral Documents and (ii) the Lien of
the Guarantors securing (for the benefit of the Holders of Notes) the Notes
and the Guarantees and to effectuate and preserve the security of the Holders
of Notes and all rights of the Trustee.
(b) The Company, the Guarantors and any other obligor shall
furnish to the Trustee:
(i) promptly after the execution and delivery of this
Indenture, and promptly after the execution and delivery of any supplemental
indenture or other amendment to any Collateral Document, an Opinion of Counsel
in the United States either (i) stating that in the opinion of such counsel,
this Indenture, the Collateral Documents and all other instruments of further
assurance or amendment have been properly recorded, registered and filed to
the extent necessary to make effective the Lien intended to be created by such
Collateral Documents and reciting the details of such action or referring to
prior Opinions of Counsel in which such details are given, and stating that,
as to such Collateral Documents and such other instruments such recording,
registering and filing are the only recordings, registerings and filings
necessary to give notice thereof and that no re-recordings, re-registerings or
re-filings are necessary to maintain such notice, and further stating that all
financing statements and continuation statements have been executed and filed
that are necessary fully to preserve and protect the rights of the Holders of
Notes and the Trustee hereunder and under the Collateral Documents or (ii)
stating that, in the opinion of such counsel, no such action is necessary to
make any other Lien created under any of the Collateral Documents effective as
intended by such Collateral Documents; and
(ii) On August 22, in each year beginning with the year
1996, an Opinion of Counsel, dated as of such date, either (A) stating that,
in the opinion of such counsel, such action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and re-filing of
this Indenture and all supplemental indentures, financing statements,
continuation statements or other instruments of further assurance as is
necessary to maintain the Liens of this Indenture and the Collateral Documents
until the next Opinion of Counsel is required to be rendered pursuant to this
paragraph and reciting the details of such action or referring to prior
Opinions of Counsel in which such details are given, and stating that all
financing statements and continuation statements have been executed and filed
that are necessary fully to preserve and protect the rights of the Holders and
the Trustee hereunder and under the Collateral Documents or (B) stating that
in the opinion of such counsel, no such action is necessary to maintain such
Liens, until the next Opinion of Counsel is required to be rendered pursuant
to this paragraph.
(c) The Company shall furnish to the Trustee the certificates or
opinions, as the case may be, required by TIA Section 314(d). Such
certificates or opinions shall be subject to the terms of TIA Section 314(e).
SECTION 10.03. RELEASE OF NOTE COLLATERAL.
(a) Subject to paragraphs (b), (c) and (d) of this Section
10.03, Note Collateral may be released from the Lien and security interest
created by this Indenture and the Collateral Documents at any time or from
time to time, and except with respect to clause (viii) of the immediately
following sentence, upon the request of the Company pursuant to an Officers'
Certificate certifying that all terms for release and conditions precedent
hereunder and under any applicable Collateral Document have been met and
specifying (i) the identity of the Note Collateral to be released and (ii) the
provision of this Indenture that authorizes such release. The Trustee shall
release (at the sole cost and expense of the Company) (i) the Casino
Magic-Bossier City Hotel, including the real property on which it is to be
built, in the event that the Company elects to effect such a release in
connection with the incurrence of additional Indebtedness secured by such
property in accordance with the provisions of Section 4.09; including, without
limitation, the requirement that the proceeds from incurring such Indebtedness
be used to finance the construction of the Casino Magic-Bossier City Hotel,
that no Default or Event of Default has occurred and is continuing or would
occur immediately following such release and that the Reciprocal Easement
Agreement substantially in the form attached hereto as Exhibit U has been
fully executed, including, without limitation all consents from mortgages
required by such reciprocal Easement Agreement; (ii) the Crescent City
Riverboat shall be released in the event that the Company elects to effect
such a release in connection with the sale of the Crescent City Riverboat in
accordance with the provisions of Section 4.10; including, without limitation,
the requirement that the net proceeds from such transaction, are or will be
applied in accordance with this Indenture and that no Default or Event of
Default has occurred and is continuing or would occur immediately following
such release; (iii) Note Collateral that is to be sold pursuant to Section
4.10 herein in an Asset Sale; PROVIDED that the Net Proceeds, from such Asset
Sale are or will be applied in accordance with Section 4.10 hereof and that no
Default or Event of Default has occurred and is continuing or would occur
immediately following such release; (iv) Note Collateral that is condemned,
seized or taken by the power of eminent domain or otherwise confiscated
pursuant to an Event of Loss; PROVIDED that the Net Loss Proceeds, if any,
from such Event of Loss are or will be applied in accordance with Section 4.11
hereof and that no Default or Event of Default has occurred and is continuing
or would occur immediately following such release; (v) Note Collateral that
may be released with the consent of Holders pursuant to Article 9 hereof; (vi)
all Note Collateral (except as provided in Article 8 hereof and, in
particular, the funds in the trust fund described in Section 8.04 hereof) upon
discharge or defeasance of this Indenture in accordance with Article 8 hereof;
(vi) all Note Collateral upon the payment in full of all obligations of the
Company with respect to the Notes; (vii) capital stock and Note Collateral of
a Guarantor (other than Note Collateral of Jefferson Corp.) whose Note
Guarantee is released pursuant to Section 11.05 hereof and (viii) inventory
sold or otherwise disposed of in the ordinary course of business (provided
that all proceeds thereof shall be subject to the Lien) and Restricted
Payments permitted under Section 4.07. Upon receipt of such Officers'
Certificate the Trustee shall execute, deliver or acknowledge any necessary or
proper instruments of termination, satisfaction or release to evidence the
release of any Note Collateral permitted to be released pursuant to this
Indenture or the Collateral Documents.
(b) No Note Collateral shall be released from the Lien and
security interest created by the Collateral Documents pursuant to the
provisions of the Collateral Documents unless there shall have been delivered
to the Trustee the certificate required by this Section 10.03.
(c) The Trustee may release Note Collateral from the Lien and
security interest created by this Indenture and the Collateral Documents upon
the sale or disposition of Note Collateral pursuant to the Trustee's powers,
rights and duties with respect to remedies provided under any of the
Collateral Documents.
(d) The release of any Note Collateral from the terms of this
Indenture and the Collateral Documents shall not be deemed to impair the
security under this Indenture in contravention of the provisions hereof if and
to the extent the Note Collateral is released pursuant to the terms hereof.
To the extent applicable, the Company shall cause TIA 313(b), relating to
reports, and TIA 314(d), relating to the release of property or securities
from the Lien and security interest of the Collateral Documents and relating
to the substitution therefor of any property or securities to be subjected to
the Lien and security interest of the Collateral Documents to be complied
with. Any certificate or opinion required by TIA 314(d) may be made by an
Officer of the Company except in cases where TIA 314(d) requires that such
certificate or opinion be made by an independent Person, which Person shall be
an independent engineer, appraiser or other expert selected or approved by the
Trustee in the exercise of reasonable care.
SECTION 10.04. PROTECTION OF THE TRUST ESTATE.
Upon prior written notice to the Company and the Guarantors, the
Trustee shall have the power (i) to institute and maintain such suits and
proceedings as it may deem expedient, to prevent any impairment of the Note
Collateral under any of the Collateral Documents; and (ii) to enforce the
obligations of the Company, the Guarantors or any Subsidiary under this
Indenture or the Collateral Documents, to institute and maintain such suits
and proceedings as may be expedient to prevent any impairment of the Note
Collateral under the Collateral Documents and in the profits, rents, revenues
and other income arising therefrom, including the power to institute and
maintain suits or proceedings to restrain the enforcement of or compliance
with any legislative or other governmental enactment, rule or order that may
be unconstitutional or otherwise invalid if the enforcement of, or compliance
with, such enactment, rule or order would impair any Note Collateral or be
prejudicial to the interests of the Holders of Notes or the Trustee, to the
extent permitted thereunder. Upon receipt of notice that a Subsidiary or a
Guarantor is not in compliance with any of the requirements of the Mortgage,
the Trustee may, but shall have no obligation to purchase, at the Company's
expense, such insurance coverage necessary to comply with the appropriate
section of the mortgage.
SECTION 10.05. CERTIFICATES OF THE COMPANY.
The Company shall furnish to the Trustee, prior to each proposed
release of Note Collateral pursuant to this Indenture or any of the Collateral
Documents (i) all documents required by TIA 314(d) and (ii) an Opinion of
Counsel in the United States to the effect that, such accompanying documents
constitute all documents required by TIA 314(d). The Trustee may accept as
conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such documents and such Opinion of
Counsel.
SECTION 10.06. CERTIFICATES OF THE TRUSTEE.
In the event that the Company wishes to release Note Collateral in
accordance with the Collateral Documents and has delivered the certificates
and documents required by the Collateral Documents and Sections 10.03 and
10.05 hereof, the Trustee shall determine whether it has received all
documentation required by TIA 314(d) in connection with such release and,
based on such determination and the Opinion of Counsel delivered pursuant to
clause (ii) of Section 10.05 hereof if required, shall deliver a certificate
to the Company setting forth such determination.
SECTION 10.07. AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE TRUSTEE UNDER
THE COLLATERAL DOCUMENTS.
Subject to the provisions of Sections 7.01 and 7.02 hereof, the
Trustee may, in its sole discretion and without the consent of the Holders of
Notes, direct, on behalf of the Holders of Notes, the Collateral Agent to,
take all actions it deems necessary or appropriate in order to (i) enforce any
of the terms of the Collateral Documents and (ii) collect and receive any and
all amounts payable in respect of the Obligations of the Company hereunder.
The Trustee shall have power to institute and maintain such suits and
proceedings as it may deem expedient to prevent any impair-ment of the Note
Collateral by any acts that may be unlawful or in violation of the Collateral
Documents or this Indenture, and such suits and proceedings as the Trustee may
deem expedient to preserve or protect its interests and the interests of the
Holders of Notes in the Note Collateral (including power to institute and
maintain suits or proceedings to restrain the enforcement of or compliance
with any legislative or other governmental enactment, rule or order that may
be unconstitutional or otherwise invalid if the enforcement of, or compliance
with, such enactment, rule or order would impair the security interest
hereunder or be prejudicial to the interests of the Holders of Notes or of the
Trustee).
SECTION 10.08. AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER THE
COLLATERAL DOCUMENTS.
(a) Upon an Event of Default and so long as such Event of
Default continues, the Trustee may exercise in respect of the Note Collateral,
in addition to the other rights and remedies provided for herein, in the
Collateral Documents or otherwise available to it, all of the rights and
remedies of a secured party under the Uniform Commercial Code of New York or
Louisiana, as applicable, or other applicable law, and the Trustee may also
upon obtaining possession of the Note Collateral as set forth herein, without
notice to the Company, except as specified below, sell the Note Collateral or
any part thereof in one or more parcels at public or private sale, at any
exchange, broker's board or at any of the Trustee's offices or elsewhere, for
cash, on credit or for future delivery, and upon such other terms as the
Trustee may deem commercially reasonable. The Company acknowledges and agrees
that any such private sale may result in prices and other terms less favorable
to the seller than if such a sale were a public sale. The Company agrees
that, to the extent notice of sale shall be required by law, at least 10 days'
notice to the Company of the time and place of any public sale or the time
after which any private sale is to be made shall constitute reasonable
notification. The Trustee shall not be obligated to make any sale regardless
of notice of sale having been given. The Trustee may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.
(b) Subject to the provisions of Section 6.10 hereof, any cash
that is Note Collateral held by the Trustee and all cash proceeds received by
the Trustee in respect of any sale of, collection from, or other realization
upon all or any part of the Note Collateral shall be held for the benefit of
the holders (unless otherwise provided for in the Collateral Documents and
after payment of any and all amounts payable to the Trustee pursuant to this
Indenture), until such time as the Holders of the Notes shall direct the
Trustee pursuant to Section 6.05 hereof to apply such cash proceeds: (i)
against the obligations for the ratable benefit of the Holders of the Notes,
(ii) to maintain, repair or otherwise protect the Note Collateral or (iii) to
take such other action to protect the other rights of the Holders of the Notes
or to take any other appropriate action or remedy for the benefit of the
Holders of the Notes. Any surplus of such cash or cash proceeds held by the
Trustee and remaining after payment in full of all the obligations shall be
paid over to the Company or to whomsoever may be lawfully entitled to receive
such surplus or as a court of competent jurisdiction may direct.
SECTION 10.09. TERMINATION OF SECURITY INTEREST.
Upon the payment in full of all Obligations of the Company under
this Indenture and the Notes, or upon Legal Defeasance or Covenant Defeasance,
the Trustee shall, at the request of the Company, deliver a certificate to the
Trustee stating that such Obligations have been paid in full, and instruct the
Trustee to release the Liens pursuant to this Indenture and the Collateral
Documents.
SECTION 10.10. COOPERATION OF TRUSTEE.
In the event the Company or any Guarantor pledges or grants a
security interest in additional Note Collateral, the Trustee shall cooperate
with the Company or such Guarantor in reasonably and promptly agreeing to the
form of, and executing as required, any instruments or documents necessary to
make effective the security interest in the Note Collateral to be so
substituted or pledged. To the extent practicable, the terms of any security
agreement or other instrument or document necessitated by any such
substitution or pledge shall be comparable to the provisions of the existing
Collateral Documents. Subject to, and in accordance with the requirements of
this Article 10 and the terms of the Collateral Documents, in the event that
the Company or any Guarantor engages in any transaction pursuant to Section
10.03 hereof, the Trustee shall cooperate with the Company or such Guarantor
in order to facilitate such transaction in accordance with any reasonable time
schedule proposed by the Company, including by delivering and releasing the
Note Collateral in a prompt and reasonable manner.
SECTION 10.11. COLLATERAL AGENT.
The Trustee may, from time to time, appoint one or more Collateral
Agents hereunder. Each of such Collateral Agents may be delegated any one or
more of the duties or rights of the Trustee hereunder or under the Collateral
Documents or that are specified in any Collateral Documents, including without
limitation, the right to hold any Note Collateral in the name of, registered
to, or in the physical possession of, such Collateral Agent, for the rateable
benefit of the Holders of the Notes. Each such Collateral Agent shall have
such rights and duties as may be specified in an agreement between the Trustee
and such Collateral Agent.
ARTICLE 11
GUARANTEES
SECTION 11.01. GUARANTEES.
(a) Each of the Guarantors, jointly and severally, hereby
unconditionally guarantees, on a senior secured basis (each such guarantee
being a "GUARANTEE"), to each Holder of a Note authenticated and delivered by
the Trustee and to the Trustee and its successors and assigns, irrespective of
the validity or enforceability of this Indenture, the Notes or the Obligations
of the Company under this Indenture or the Notes, that: (i) the principal of,
premium, if any, Liquidated Damages, if any, and interest on the Notes shall
be paid in full when due, whether at the maturity or interest payment or
mandatory redemption date, by acceleration, call for redemption or otherwise,
and (to the extent permitted by law) interest on the overdue principal,
premium, Liquidated Damages, if any, and interest on the Notes and all other
Obligations of the Company to the Holders or the Trustee under this Indenture
or the Notes shall be promptly paid in full or performed, all in accordance
with the terms of this Indenture and the Notes; and (ii) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, they shall be paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at maturity, by
acceleration, redemption or otherwise. Failing payment when due of any amount
so guaranteed or failing performance of any other Obligation of the Company to
the Holders or the Trustee, for whatever reason, each Guarantor shall be
jointly and severally obligated to pay, or to perform or to cause the
performance of, the same immediately, whether or not such failure to pay or
perform has become an Event of Default that could cause acceleration pursuant
to Section 6.02 hereof. An Event of Default under this Indenture or the Notes
shall constitute an event of default under this Guarantee, and shall entitle
the Holders of Notes to accelerate the Obligations of each Guarantor hereunder
in the same manner and to the same extent as the Obligations of the Company.
(b) Each Guarantor hereby agrees that its obligations with
regard to each Guarantee shall be joint and several and unconditional,
irrespective of the validity or enforceability of the Notes or this Indenture,
the absence of any action to enforce the same, any waiver or consent by any
Holder of Notes with respect to any provision hereof or thereof, the recovery
of any judgment against the Company or any other obligor with respect to this
Indenture, the Notes or the Obligations of the Company under this Indenture or
the Notes, any action to enforce the same or any other circumstances that
might otherwise constitute a legal or equitable discharge or defense of a
Guarantor. Each Guarantor, to the extent permitted by law, hereby waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims,
rights or remedies, including but not limited to: (i) any right to require
the Trustee, the Holders or the Company (each, a "BENEFITTED PARTY") to
proceed against the Company or any other Person or to proceed against or
exhaust any security held by a Benefitted Party at any time or to pursue any
other remedy in any Benefitted Party's power before proceeding against such
Guarantor; (ii) the defense of the statute of limitations in any action
hereunder or in any action for the collection of any Indebtedness or the
performance of any obligation hereby guaranteed; (iii) any defense that may
arise by reason of the incapacity, lack of authority, death or disability of
any other Person or the failure of a Benefitted Party to file or enforce a
claim against the estate (in administration, bankruptcy or any other
proceeding) of any other Person; (iv) diligence, presentment, demand, protest
and notice of any kind including but not limited to notice of the existence,
creation or incurring of any new or additional Indebtedness or obligation or
of any action or non-action on the part of such Guarantor, the Company, any
Benefitted Party, any creditor of such Guarantor, the Company or on the part
of any other Person whomsoever in connection with any Indebtedness or
Obligations hereby guaranteed; (v) any defense based upon an election of
remedies by a Benefitted Party, including but not limited to an election to
proceed against such Guarantor for reimbursement; (vi) any defense based upon
any statute or rule of law that provides that the obligation of a surety must
be neither larger in amount nor in other respects more burdensome than that of
the principal; (vii) any defense arising because of a Benefitted Party's
election, in any proceeding instituted under the Federal Bankruptcy Code, of
the application of Section 1111(b)(2) of the Federal Bankruptcy Code; or
(viii) any defense based on any borrowing or grant of a security interest
under Section 364 of the Federal Bankruptcy Code. Each Guarantor hereby
covenants that its Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.
(c) If any Holder or the Trustee is required by any court or
otherwise to return to either the Company or any Guarantor, or any custodian,
trustee, or similar official acting in relation to either the Company or such
Guarantor, any amount paid by the Company or such Guarantor to the Trustee or
such Holder, the applicable Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor agrees that it
will not be entitled to any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby.
(d) Each Guarantor further agrees that, as between such
Guarantor, on the one hand, and the Holders and the Trustee, on the other
hand, (i) the maturity of the Obligations guaranteed hereby may be accelerated
as provided in Article 6 hereof for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration as to the Company or any other obligor on the Notes of the
obligations guaranteed hereby and (ii) in the event of any declaration of
acceleration of those obligations as provided in Article 6 hereof, those
obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor for the purpose of this Guarantee.
SECTION 11.02. EXECUTION AND DELIVERY OF GUARANTEES.
To evidence the Guarantees set forth in Section 0 hereof, each of
the Guarantors agrees that a notation of the Guarantees substantially in the
form of Exhibit B shall be endorsed on each Note authenticated and delivered
by the Trustee and that this Indenture shall be executed on behalf of each of
the Guarantors by the Chairman of the Board, any Vice Chairman, the President
or one of the Vice Presidents of each of the Guarantors, under a facsimile of
its seal reproduced on this Indenture and attested to by an Officer other than
the Officer executing this Indenture.
Each of the Guarantors agree that the Guarantees set forth in this
Article 0 shall remain in full force and effect and apply to all the Notes
notwithstanding any failure to endorse on each Note a notation of the
Guarantees.
If an Officer whose facsimile signature is on a Note no longer holds
that office at the time the Trustee authenticates the Note on which the
Guarantees are endorsed, the Guarantees shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantees set forth
in this Indenture on behalf of the Guarantors.
SECTION 11.03. LIMITATION OF GUARANTORS' LIABILITY.
Each Guarantor, and by its acceptance hereof, each Holder, hereby
confirms that it is its intention that the Guarantee by such Guarantor not
constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer
Act or any similar federal or state law to the extent applicable to any of the
Guarantees. To effectuate the foregoing intention, each such Person hereby
irrevocably agrees that the obligation of such Guarantor under its Guarantee
under this Article 0 shall be limited to the maximum amount as will, after
giving effect to such maximum amount and all other liabilities of such
Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 0, result in the obligations of such Guarantor in
respect of such maximum amount not constituting a fraudulent conveyance. Each
beneficiary under the Guarantees, by accepting the benefits hereof, confirms
its intention that, in the event of a bankruptcy, reorganization or other
similar proceeding of the Company or any Guarantor in which concurrent claims
are made upon such Guarantor hereunder, to the extent such claims will not be
fully satisfied, each such claimant with a valid claim against the Company
shall be entitled to a ratable share of all payments by such Guarantor in
respect of such concurrent claims.
SECTION 11.04. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
(a) No Guarantor shall consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person) another Person whether
or not affiliated with such Guarantor unless (i) subject to the provisions of
Section 11.05 hereof the Person formed by or surviving any such consolidation
or merger (if other than such Guarantor) assumes, pursuant to a supplemental
indenture and appropriate Collateral Documents in form and substance
reasonably satisfactory to the Trustee, all the Obligations of such Guarantor
under the Notes, this Indenture and the Collateral Documents; (ii) immediately
after giving effect to such transaction, no Default or Event of Default
exists; (iii) such Guarantor, or any Person formed by or surviving any such
consolidation or merger, would have Consolidated Net Worth (immediately after
giving effect to such transaction) equal to or greater than the Consolidated
Net Worth of such Guarantor immediately preceding the transaction; (iv) the
Company would be permitted by virtue of the Company's pro forma Fixed Charge
Coverage Ratio, immediately after giving effect to such transaction, to incur
at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in Section 4.09; (v) the Fixed Charge Coverage
Ratio of such Guarantor, or any Person formed by or surviving any such
consolidation or merger, for the Reference Period immediately preceding the
date on which such consolidation or merger occurred, determined on a pro forma
basis (including a pro forma application of the proceeds therefrom) as if such
consolidation or merger had occurred at the beginning of such Reference
Period, would be no less than 85% of such Guarantor's or such Person's Fixed
Charge Coverage Ratio for such Reference Period prior to giving effect to such
consolidation or merger; (vi) such transaction would not result in the loss or
suspension or material impairment of any Gaming License (unless a comparable
replacement Gaming License is effective prior to or simultaneously with such
loss, suspension or material impairment); and (vii) such transaction would not
require any Holder or beneficial owner of Notes to obtain a Gaming License or
be qualified under the laws of any applicable gaming jurisdiction; PROVIDED,
that such Holder or beneficial owner would not have been required to obtain a
Gaming License or be qualified under the laws of any applicable gaming
jurisdiction in the absence of such transaction; PROVIDED, FURTHER, HOWEVER,
that the requirements set forth in the preceding clauses (iii), (iv) and (v)
will not prohibit any merger or consolidation among the Company and one or
more Wholly Owned Subsidiaries of the Company.
(b) The Trustee, subject to the provisions of Section 11.05
hereof, shall be entitled to receive an Officers' Certificate and an Opinion
of Counsel as conclusive evidence that any such consolidation, merger, sale or
conveyance, and any such assumption of Obligations, comply with the provisions
of this Section 11.04. Such certificate and opinion shall comply with
the
provisions of Section 13.05.
SECTION 11.05. RELEASES OF GUARANTEES.
In the event of a sale or other disposition of all or substantially
all of the assets of any Guarantor (other than Jefferson Corp.), by way of
merger, consolidation or otherwise, or a sale or other disposition of all of
the Capital Stock of any Guarantor (other than Jefferson Corp.), then such
Guarantor (in the event of a sale or other disposition, by way of such a
merger, consolidation or otherwise, of all of the Capital Stock of such
Guarantor) or the corporation acquiring the property (in the event of a sale
or other disposition of all or substantially all of the assets of such
Guarantor) shall be released and relieved of any Obligations under its
Guarantee and the Collateral Documents; PROVIDED that (i) immediately after
giving effect to such transaction, no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence thereof and (ii)
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Indenture. Upon delivery by the
Company to the Trustee of an Officers' Certificate and Opinion of Counsel, to
the effect that such sale or other disposition was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.10 hereof, the Trustee shall execute any documents reasonably
required in order to evidence the release of any such Guarantor from its
obligations under its Guarantee and the Collateral Documents. Any Guarantor
not released from its obligations under its Guarantee and the Collateral
Documents shall remain liable for the full amount of principal of, premium and
Liquidated Damages, if any, and interest on the Notes and for the other
Obligations of any Guarantor under this Indenture as provided in this Article
0. Nothing herein shall relieve the Company from its obligations to apply the
proceeds of an Asset Sale as provided in Section 4.10 hereof.
SECTION 11.06. "TRUSTEE" TO INCLUDE PAYING AGENT.
In case at any time any Paying Agent other than the Trustee shall
have been appointed by the Company and be then acting hereunder, the term
"TRUSTEE" as used in this Article 0 shall in such case (unless the context
shall otherwise require) be construed as extending to and includ-ing such
Paying Agent within its meaning as fully and for all intents and purposes as
if such Paying Agent were named in this Article 0 in place of the Trustee.
ARTICLE 12
SATISFACTION AND DISCHARGE
SECTION 12.01. SATISFACTION AND DISCHARGE.
This Indenture shall, upon the request of the Company, cease to be
of further effect (except as to surviving rights of registration of transfer
or exchange of Notes herein expressly provided for) and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture and releasing all Liens and
security interests in the Collateral when
(a) either
(i) all Notes theretofore authenticated and delivered
(other than (A) Notes which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.07 and (B) Notes for whose
payment money has been deposited in trust with the Trustee or any Paying Agent
and thereafter paid to the Company or discharged from such trust) have been
delivered to the Trustee for cancellation; or
(ii) all such Notes not theretofore delivered to the
Trustee for cancellation
(A) have become due and payable, or
(B) will become due and payable at their stated
maturity within one year, or
(C) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company,
and the Company, in the case of clause (A), (B) or (C) above, has
irrevocably deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for principal (and premium, if any) and interest to the date of
such deposit (in the case of Notes which have become due and payable) or to
the stated maturity or redemption date, as the case may be;
(b) the Company has paid or caused to be paid all other sums
then due and payable hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 7.08 and, if money
shall have been deposited with the Trustee pursuant to subclause (i) of clause
(a) of this Section 12.01, the obligations of the Trustee under Section 12.02
shall survive.
SECTION 12.02. APPLICATION OF TRUST MONEY.
All money deposited with the Trustee pursuant to Section 12.01 shall
be held in trust and, at the written direction of the Company, be invested
prior to maturity in U.S. Government Obligations, and applied by the Trustee
in accordance with the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and interest for the
payment of which money has been deposited with the Trustee; but such money
need not be segregated from other funds except to the extent required by law.
Any funds remaining following payment of all Notes and all other obligations
of the Company hereunder shall be the property of the Company.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA 318(c), the imposed duties shall control.
SECTION 13.02. NOTICES.
Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt
requested), telex, telecopier or overnight air courier guaranteeing next day
delivery, to the others' address:
If to the Company or the Guarantors:
Casino Magic of Louisiana, Corp.
0000 Xxx Xxxxxx Xxxx
Xxxxxxx Xxxx, Xxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Secretary
With a copy to:
Akin Gump Xxxxxxx Xxxxx & Xxxx
0000 Xxxxxxxxxxx Xxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Attention: J. Xxxxxxx Xxxx, Esq.
If to the Trustee:
First Union Bank of Connecticut
00 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery
to the courier, if sent by over-night air courier guaranteeing next day
delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on
the register kept by the Registrar. Any notice or communication shall also be
so mailed to any Person described in TIA 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company or a Guarantor mails a notice or communication to
Holders, it shall mail a copy to the Trustee and each Agent at the same time.
SECTION 13.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF
NOTES.
Holders may communicate pursuant to TIA 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Guarantors, the Trustee, the Registrar and anyone else shall have the
protection of TIA 312(c).
SECTION 13.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company or any Guarantor to
the Trustee to take any action under this Indenture, the Company or such
Guarantor, as the case may be, shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Sec-tion 13.05 hereof) stating that, in the opinion of the signers,
all conditions precedent and covenants, if any, provided for in this
Indenture relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Sec-tion 13.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
SECTION 13.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA 314(a)(4)) shall comply with the provisions of TIA
314(e) and shall include:
(a) a statement that the Person mak-ing such certi-ficate
or opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investi-gation upon which the statements or opinions contained
in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or
she has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or condition
has been satisfied; and
(d) a statement as to whether or not, in the opinion of
such Person, such condi-tion or covenant has been satisfied; provided,
however, that with respect to matters of fact, an Opinion of Counsel may rely
on an Officers' Certificate or certificates of public officials.
SECTION 13.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 13.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator
or stockholder of the Company or any Guarantor, as such, shall have any
liability for any obligations of the Company or the Guarantors under the
Notes, this Indenture, any Guarantee or the Collateral Documents, as
applicable, or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
SECTION 13.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES WITHOUT REGARD TO
THE CONFLICTS OF LAW PROVISIONS THEREOF.
SECTION 13.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 13.10. SUCCESSORS.
All agreements of the Company and the Guarantors in this Indenture
and the Notes and the Guarantees, as applicable, shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 13.11. SEVERABILITY.
In case any provision in this Indenture, in the Notes or in the
Guarantee shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION 13.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
SECTION 13.13. ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or
taken by the Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agents duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company and the Guarantors. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Indenture and conclusive in favor of the Trustee, the Company and the
Guarantors, if made in the manner provided in this Section 13.13.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized
by law to take acknowledgements of deeds, certifying that the individual
signing such instrument or writing acknowledged to such witness, notary or
officer the execution thereof. Where such execution is by a signer acting in
a capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) The principal amount and serial numbers of Notes held by any
Holder, and the date of holding the same, shall be proved by the register of
the Notes maintained by the Registrar as provided in Section 2.03.
(d) If the Company shall solicit from the Holders of the Notes
any request, demand, authorization, direction, notice, consent, waiver or
other Act, the Company may, at its option, by or pursuant to a resolution of
the Company's Board of Directors, fix in advance a record date for the
determination of Holders entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other Act, but the Company shall have no
obligation to do so. Notwithstanding TIA 316(c), such record date shall be
the record date specified in or pursuant to such resolution, which shall be a
date not earlier than the date 30 days prior to the first solicitation of
Holders generally in connection therewith or the date of the most recent list
of Holders forwarded to the Trustee prior to such solicitation pursuant to
Section 2.05 and not later than the date such solicitation is completed. If
such a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business on such record
date shall be deemed to be Holders for the purposes of determining whether
Holders of the requisite proportion of the then outstanding Notes have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other Act, and for that purpose the then
outstanding Notes shall be computed as of such record date; provided, that no
such authorization, agreement or consent by the Holders on such record date
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than eleven months after the record
date.
(e) Any request, demand, authorization,direction, notice,
consent, waiver or other Act of the Holder of any Note shall bind every future
Holder of the same Note and the Holder of every Note issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made
upon such Note.
(f) Without limiting the foregoing, a Holder entitled hereunder
to take any action hereunder with regard to any particular Note may do so
itself with regard to all or any part of the principal amount of such Note or
by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.
SECTION 13.14. LEGAL HOLIDAYS.
If any date specified in this Indenture, the Notes or the Collateral
Documents for the occurrence of any event (including the giving of notice and
the making of a payment) shall not be a Business Day, then such event shall
occur on the next succeeding date that is a Business Day with the same force
and effect as if such event had occurred on the date originally specified and,
if such event is a payment day in respect of the Notes, no interest shall
accrue for the intervening period.
SECTION 13.14. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
SIGNATURES
Dated as of Xxxxxx 00, 0000 XXXXXX MAGIC OF LOUISIANA, CORP.
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President, General Council
Attest: Xxx X. Xxxxx
Dated as of August 22, 1996 JEFFERSON CASINO CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President, General Council
Attest: Xxx X. Xxxxx
Dated as of August 22, 0000 XXXXX XXXXX XXXX XX XXXXXXXXXXX
Trustee
By: /s/ W. Xxxxxxx Xxxxxx
Name: W. Xxxxxxx Xxxxxx
Title: Vice President
Attest:
(SEAL)
A-1
C-3
EXHIBIT C
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF NOTES
Re: 13% First Mortgage Notes due 2003 With Contingent Interest of Casino
Magic of Louisiana, Corp.
This Certificate relates to $___________ principal amount of Notes
held in * ________ book-entry or *_______ definitive form by
____________________________________ (the "Transferor").
The Transferor*:
___ has requested the Trustee by written order to deliver in exchange
for its beneficial interest in the Global Note held by the Depositary a Note
or Notes in definitive, registered form of authorized denominations in an
aggregate principal amount equal to its beneficial interest in such Global
Note (or the portion thereof indicated above); or
___ has requested the Trustee by written order to exchange or
register the transfer of a Note or Notes.
In connection with such request and in respect of each such Note,
the Transferor does hereby certify that it is familiar with the Indenture
relating to the above captioned Notes and as provided in Section 2.06 of such
Indenture, the transfer of this Note does not require registration under the
Securities Act (as defined below) because:*
___ Such Note is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.06(a)(ii)(A), Section
2.06(b)(i)(A) or Section 2.06(d)(i)(A) of the Indenture).
___ Such Note is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of 1933, as amended
(the "Securities Act")) in reliance on Rule 144A (in satisfaction of Section
2.06(a)(ii)(B), Section 2.06(b)(i)(B) or Section 2.06(d)(i) (B) of the
Indenture) or pursuant to an exemption from registration in accordance with
Rule 904 under the Securities Act (in satisfaction of Section 2.06(a)(ii)(B),
Section 2.06(b)(i)(B) or Section 2.06(d)(i)(B) of the Indenture.)
_______________
*Check applicable box.
___ Such Note is being transferred in accordance with Rule 144 under
the Securities Act, or pursuant to an effective registration statement under
the Securities Act (in satisfaction of Section 2.06(a)(ii)(B), Section
2.06(b)(i)(B) or Section 2.06(d)(i)(B) of the Indenture).
___ Such Note is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Securities Act,
other than Rule 144A, Rule 144 or Rule 904 under the Securities Act. An
Opinion of Counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate (in
satisfaction of Section 2.06(a)(ii)(C), Section 2.06(b)(i)(C) or Section
2.06(d)(i)(C) of the Indenture).
[INSERT NAME OF TRANSFEROR]
By:
Date:
_______________
*Check applicable box.
EXHIBIT D
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
__________________, between ________________________ (the "Guarantor"), a
subsidiary of Casino Magic of Louisiana, Corp. (or its successor), a Louisiana
corporation (the "Company"), and First Union Bank of Connecticut, as trustee
under the indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of August 22, 1996, providing
for the issuance of an aggregate principal amount of $115,000,000 of 13% First
Mortgage Notes due 2003 with Contingent Interest (the "Notes");
WHEREAS, Section 4.18 of the Indenture provides that under certain
circumstances the Company is required to cause the Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the
Guarantor shall guarantee all of the Company's obligations under of the Notes
pursuant to a Guarantee on the terms and conditions set forth herein; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and
ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE.
(a) The Guarantor, jointly and severally, hereby
unconditionally guarantees, on a senior secured basis (each such guarantee
being a "Guarantee"), to each Holder of a Note authenticated and delivered by
the Trustee and to the Trustee and its successors and assigns, irrespective of
the validity or enforceability of the Indenture, the Notes or the Obligations
of the Company under the Indenture or the Notes, that: (i) the principal of,
premium, if any, and Liquidated Damages, if any and interest on the Notes
shall be paid in full when due, whether at the maturity or interest payment or
mandatory redemption date, by acceleration, call for redemption or otherwise,
and (to the extent permitted by law) interest on the overdue principal,
premium, Liquidated Damages, if any, and interest, if any, of the Notes, and
all other Obligations of the Company to the Holders or the Trustee under the
Indenture or the Notes shall be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Notes; and (ii) in case of
any extension of time of payment or renewal of any Notes or any of such other
obligations, they shall be paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at maturity, by
acceleration, redemption or otherwise. Failing payment when due of any amount
so guaranteed or failing performance of any other Obligation of the Company to
the Holders, for whatever reason, each Guarantor shall be jointly and
severally obligated to pay, or to perform or to cause the performance of, the
same immediately, whether or not such failure to pay or perform has become an
Event of Default that could cause acceleration pursuant to Section 6.02 of the
Indenture. An Event of Default under the Indenture or the Notes shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Notes to accelerate the Obligations of each Guarantor hereunder in
the same manner and to the same extent as the Obligations of the Company.
(b) Each Guarantor hereby agrees that its obligations with
regard to each Guarantee shall be joint and several and unconditional,
irrespective of the validity or enforceability of the Notes or the Indenture,
the absence of any action to enforce the same, any waiver or consent by any
Holder of Notes with respect to any provision hereof or thereof, the recovery
of any judgment against the Company or any other obligor with respect to the
Indenture, the Notes or the Obligations of the Company under the Indenture or
the Notes, any action to enforce the same or any other circumstances that
might otherwise constitute a legal or equitable discharge or defense of a
Guarantor. Each Guarantor, to the extent permitted by law, hereby waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims,
rights or remedies, including but not limited to: (i) any right to require the
Trustee, the Holders or the Company (each, a "BENEFITTED PARTY") to proceed
against the Company or any other Person or to proceed against or exhaust any
security held by a Benefitted Party at any time or to pursue any other remedy
in any Benefitted Party's power before proceeding against such Guarantor; (ii)
the defense of the statute of limitations in any action hereunder or in any
action for the collection of any Indebtedness or the performance of any
obligation hereby guaranteed; (iii) any defense that may arise by reason of
the incapacity, lack of authority, death or disability of any other Person or
the failure of a Benefitted Party to file or enforce a claim against the
estate (in administration, bankruptcy or any other proceeding) of any other
Person; (iv) diligence, presentment, demand, protest and notice of any kind
including but not limited to notice of the existence, creation or incurring of
any new or additional Indebtedness or obligation or of any action or
non-action on the part of such Guarantor, the Company, any Benefitted Party,
any creditor of such Guarantor, the Company or on the part of any other Person
whomsoever in connection with any Indebtedness or Obligations hereby
guaranteed; (v) any defense based upon an election of remedies by a Benefitted
Party, including but not limited to an election to proceed against such
Guarantor for reimbursement; (vi) any defense based upon any statute or rule
of law that provides that the obligation of a surety must be neither larger in
amount nor in other respects more burdensome than that of the principal; (vii)
any defense arising because of a Benefitted Party's election, in any
proceeding instituted under the Federal Bankruptcy Code, of the application of
Section 1111(b)(2) of the Federal Bankruptcy Code; or (viii) any defense based
on any borrowing or grant of a security interest under Section 364 of the
Federal Bankruptcy Code. Each Guarantor hereby covenants that its Guarantee
will not be discharged except by complete performance of the obligations
contained in the Notes and the Indenture or as otherwise expressly provided
herein.
If any Holder or the Trustee is required by any court or otherwise
to return to either the Company or any Guarantor, or any custodian, trustee,
or similar official acting in relation to either the Company or such
Guarantor, any amount paid by the Company or such Guarantor to the Trustee or
such Holder, the applicable Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor agrees that it
will not be entitled to any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby.
Each Guarantor further agrees that, as between such Guarantor, on
the one hand, and the Holders and the Trustee, on the other hand, (i) the
maturity of the Obligations guaranteed hereby may be accelerated as provided
in Article 6 of the Indenture for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration as to the Company or any other obligor on the Notes of the
obligations guaranteed hereby and (ii) in the event of any declaration of
acceleration of those obligations as provided in Article 6 of the Indenture,
those obligations (whether or not due and payable) shall forthwith become due
and payable by such Guarantor for the purpose of this Guarantee.
3. EXECUTION AND DELIVERY OF GUARANTEES. To evidence the
Guarantees set forth in Section 0 of the Indenture, each of the Guarantors
agrees that a notation of the Guarantees substantially in the form included in
Exhibit B of the Indenture shall be endorsed on each Note authenticated and
delivered by the Trustee and that the Indenture shall be executed on behalf of
each of the Guarantors by the Chairman of the Board, any Vice Chairman, the
President or one of the Vice Presidents of each of the Guarantors, under a
facsimile of its seal reproduced on the Indenture and attested to by an
Officer other than the Officer executing the Indenture.
Each of the Guarantors agree that the Guarantees set forth in
Article 0 of the Indenture shall remain in full force and effect and apply to
all the Notes notwithstanding any failure to endorse on each Note a notation
of the Guarantees.
If an Officer whose facsimile signature is on a Note no longer holds
that office at the time the Trustee authenticates the Note on which the
Guarantees are endorsed, the Guarantees shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantees set forth
in the Indenture on behalf of the Guarantors.
4. LIMITATION OF GUARANTORS' LIABILITY. Each Guarantor, and by
its acceptance hereof, each Holder, hereby confirms that it is its intention
that the Guarantee by such Guarantor not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or
state law to the extent applicable to any of the Guarantees. To effectuate
the foregoing intention, each such Holder hereby irrevocably agrees that the
obligation of such Guarantor under its Guarantee under Article 0 of the
Indenture shall be limited to the maximum amount as will, after giving effect
to such maximum amount and all other liabilities of such Guarantor that are
relevant under such laws, and after giving effect to any collections from,
rights to receive contribution from or payments made by or on behalf of any
other Guarantor in respect of the obligations of such other Guarantor under
Article 0 of the Indenture, result in the obligations of such Guarantor in
respect of such maximum amount not constituting a fraudulent conveyance. Each
beneficiary under the Guarantees, by accepting the benefits hereof, confirms
its intention that, in the event of a bankruptcy, reorganization or other
similar proceeding of the Company or any Guarantor in which concurrent claims
are made upon such Guarantor hereunder, to the extent such claims will not be
fully satisfied, each such claimant with a valid claim against the Company
shall be entitled to a ratable share of all payments by such Guarantor in
respect of such concurrent claims.
5. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
No Guarantor shall consolidate with or merge with or into (whether
or not such Guarantor is the surviving Person) another Person whether or not
affiliated with such Guarantor unless (i) subject to the provisions of Section
11.05 of the Indenture, the Person formed by or surviving any such
consolidation or merger (if other than such Guarantor) assumes, pursuant to a
supplemental indenture and appropriate Collateral Documents in form and
substance reasonably satisfactory to the Trustee, all the Obligations of such
Guarantor under the Notes, the Indenture and the Collateral Documents; (ii)
immediately after giving effect to such transaction, no Default or Event of
Default exists; (iii) such Guarantor, or any Person formed by or surviving any
such consolidation or merger, would have Consolidated Net Worth (immediately
after giving effect to such transaction) equal to or greater than the
Consolidated Net Worth of such Guarantor immediately preceding the
transaction; (iv) the Company would be permitted by virtue of the Company's
pro forma Fixed Charge Coverage Ratio, immediately after giving effect to such
transaction, to incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in Section 4.09 of the
Indenture; (v) the Fixed Charge Coverage Ratio of such Guarantor, or any
Person formed by or surviving any such consolidation or merger, for the
Reference Period immediately preceding the date on which such consolidation or
merger occurred, determined on a pro forma basis (including a pro forma
application of the proceeds therefrom) as if such consolidation or merger had
occurred at the beginning of such Reference Period, would be no less than 85%
of such Guarantor's or such Person's Fixed Charge Coverage Ratio for such
Reference Period prior to giving effect to such consolidation or merger; (vi)
such transaction would not result in the loss or suspension or material
impairment of any Gaming License (unless a comparable replacement Gaming
License is effective prior to or simultaneously with such loss, suspension or
material impairment); and (vii) such transaction would not require any Holder
or beneficial owner of Notes to obtain a Gaming License or be qualified under
the laws of any applicable gaming jurisdiction; PROVIDED, that such Holder or
beneficial owner would not have been required to obtain a Gaming License or be
qualified under the laws of any applicable gaming jurisdiction in the absence
of such transaction; PROVIDED, FURTHER, HOWEVER, that the requirements set
forth in the preceding clauses (iii), (iv) and (v) will not prohibit any
merger or consolidation among the Company and one or more Wholly Owned
Subsidiaries of the Company.
The Trustee, subject to the provisions of Section 11.05 of the
Indenture, shall be entitled to receive an Officers' Certificate and an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance, and any such assumption of Obligations, comply with the
provisions of Section 0 of the Indenture. Such certificate and opinion shall
comply with the provisions of Section 13.05 of the Indenture.
6. RELEASES OF GUARANTEES. In the event of a sale or other
disposition of all or substantially all of the assets of any Guarantor, by way
of merger, consolidation or otherwise, or a sale or other disposition of all
of the Capital Stock of any Guarantor (other than Jefferson Corp.), then such
Guarantor on (in the event of a sale or other disposition, by way of such a
merger, consolidation or otherwise, of all of the Capital Stock of such
Guarantor) or the corporation acquiring the property (in the event of a sale
or other disposition of all or substantially all of the assets of such
Guarantor) shall be released and relieved of any Obligations under its
Guarantee and the Collateral Documents; PROVIDED that (i) immediately after
giving effect to such transaction, no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence thereof and (ii)
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of the Indenture. Upon delivery by the Company
to the Trustee of an Officers' Certificate and Opinion of Counsel, to the
effect that such sale or other disposition was made by the Company in
accordance with the provisions of the Indenture, including without limitation
Section 4.10 of the Indenture, the Trustee shall execute any documents
reasonably required in order to evidence the release of any such Guarantor
from its obligations under its Guarantee and the Collateral Documents. Any
Guarantor not released from its obligations under its Guarantee and Collateral
Documents shall remain liable for the full amount of principal of, premium and
Liquidated Damages, if any, and interest on the Notes and for the other
Obligations of any Guarantor under the Indenture as provided in Article 0 of
the Indenture. Nothing herein shall relieve the Company from its obligations
to apply the proceeds of an Asset Sale as provided in Section 4.10 of the
Indenture.
7. "TRUSTEE" TO INCLUDE PAYING AGENT. In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting under the Indenture, the term "TRUSTEE" as used in Article
0 of the Indenture shall in such case (unless the context shall otherwise
require) be construed as extending to and includ-ing such Paying Agent within
its meaning as fully and for all intents and purposes as if such Paying Agent
were named in Article 0 of the Indenture in place of the Trustee.
8. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee, incorporator or stockholder of the Company or the
Guarantor, as such, shall have any liability for any obligations of the
Company or the Guarantor under the Notes, the Indenture or this Supplemental
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
9. NEW YORK LAW TO GOVERN. The internal law of the State of New
York shall govern and be used to construe this Supplemental Indenture.
10. COUNTERPARTS. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all
of them together represent the same agreement.
11. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
IN WITNESS WHEREOF, the parties hereto caused this Supplemental Indenture to
be duly executed and attested, all as of the date first above written.
Dated: August 22, 1996
[Guarantor]
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President and General Council
First Union Bank of Connecticut,
as Trustee
By: /s/ W. Xxxxxxx Xxxxxx
Name: W. Xxxxxxx Xxxxxx
Title: Vice President