EXHIBIT 10.4
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PREFERRED SHIP MORTGAGE
ON THE WHOLE OF THE
GOLD COAST CASINO BARGE
(Official Number 995650)
$5,827,500.00
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The President Riverboat Casino-Mississippi, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
-Sole Owner and Mortgagor-
In Favor of
American Gaming & Entertainment, Ltd.
Xxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000
-Sole Lender and Mortgagee-
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Dated as of August 10, 1999
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Discharge Amount: $5,827,500.00 together
With Interest, Costs, Attorneys' Fees and Other Expenses
and Performance of the Mortgage Covenants
PREFERRED SHIP MORTGAGE
THIS PREFERRED SHIP MORTGAGE, dated as of August 10, 1999, is granted by:
The President Riverboat Casino-Mississippi, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
a corporation organized and existing under and by virtue of the laws of the
State of Mississippi (the "Mortgagor"), to and in favor of:
American Gaming & Entertainment, Ltd.
Xxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000
a corporation organized and existing under and by virtue of the laws of the
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State of Delaware (the "Mortgagee").
WHEREAS:
A. The Mortgagor is the sole owner of the whole of the vessel identified
and described in the Granting Clause of this Preferred Ship Mortgage (this
"Mortgage").
B. The Mortgagor is truly and justly indebted unto the Mortgagee in the
full and true sum of FIVE MILLION, EIGHT HUNDRED, TWENTY-SEVEN THOUSAND FIVE
HUNDRED AND NO/100 DOLLARS ($5,827,500.00), said indebtedness being
represented and evidenced by one certain promissory note made and subscribed
by the Mortgagor in the principal sum of FIVE MILLION, EIGHT HUNDRED, TWENTY-
SEVEN THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($5,827,500.00), dated as of
August 10, 1999, being payable to the order of Mortgagee as principal in
accordance with the terms stated therein (the "Note"). A copy of the Note is
attached hereto, made a part hereof, and identified as Exhibit "A".
C. In order to secure the payment of the principal amount of the Note,
together with the payment of all other sums now or hereafter owing by the
Mortgagor to the Mortgagee under the terms of the Note and this Mortgage (the
"Indebtedness"), the Mortgagor has agreed to execute and deliver this Mortgage
to the Mortgagee, as follows:
GRANTING CLAUSE
NOW, THEREFORE, THIS MORTGAGE WITNESSETH:
THAT, in consideration of the premises and of the additional covenants
herein contained and for other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, and in order to secure the
payment of the principal on the Note together with the performance and
observance of and compliance with the covenants, terms and conditions
contained in this Mortgage and the Note, THE MORTGAGOR HAS granted, conveyed,
mortgaged, pledged, hypothecated, set over and confirmed, AND THE MORTGAGOR
DOES BY THESE PRESENTS grant, convey, mortgage, pledge, hypothecate, set over
and confirm UNTO AND IN FAVOR OF THE MORTGAGEE, the whole of the following
named and described vessel (referred to hereinafter as the "Barge") to wit:
OFFICIAL HAILING
NAME NUMBER PORT
---- ------ ----
Gold Coast Casino 995650 Biloxi, Mississippi
TOGETHER WITH all improvements and structures from time to time thereon, and
all equipment and appurtenances from time to time thereon or thereof,
including without limitation all engines, machinery, masts, spars, boats,
cables, motors, tools, anchors, chains, booms, cranes, rigs, pumps, pipes,
tanks, tackle, rigging, supplies, fittings and all other property located
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thereon, derived therefrom or used in connection therewith, and all
replacements thereof and substitutions therefor and shall include without
limitation all slot machines and other gaming devices, machinery, tools, fire
sprinklers, alarm, air conditioning, heating, refrigerating and electronic
monitoring systems and equipment, window or structural cleaning rigs,
maintenance equipment, equipment for the exclusion of vermin or insects or the
removal of dust, refuse or garbage, lobby and all other indoor and outdoor
furniture (including tables, chairs, planters, desks, sofas, shelves, lockers
and cabinets), wall beds, wall safes, furnishings, appliances (including ice
boxes, refrigerators, fans, heaters, stoves, water heaters and incinerators),
rugs, carpets and other floor coverings, draperies and drapery rods and
brackets, awnings, window shades, venetian blinds, curtains, wall hangings,
lamps, chandeliers and other lighting fixtures and office maintenance and
other supplies.
TO HAVE AND HOLD the same unto Mortgagee, its successors and assigns,
forever upon the terms herein set forth to secure the performance and
observance of and compliance with the covenants, terms and conditions in this
Mortgage and the Note contained.
PROVIDED, only, and the condition of these presents is such, that if the
Mortgagor, its successors or assigns, shall pay or cause to be paid to
Mortgagee or any other holder of the Note all sums due thereunder, and shall
perform, observe and comply with the covenants, terms and conditions in this
Mortgage and in the Note contained, expressed or implied, to be performed,
observed or complied with by and on the part of the Mortgagor, then these
presents and the rights hereunder shall cease, terminate and be void;
otherwise to be and remain in full force and effect.
AND NOW, THE PARTIES HEREBY FURTHER AGREE, COVENANT AND DECLARE that the
Barge is to be held subject to the following covenants, conditions,
provisions, terms and uses:
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definition of Terms. For all purposes of this Mortgage,
unless the context otherwise requires:
(a) All references to Person shall mean an individual, a corporation, a
partnership, a trust, a trustee, an unincorporated organization or a
government or any agency or political subdivision thereof.
(b) Act shall mean Xxxxxxx 000 xx Xxxxx 00 Xxxxxx Xxxxxx Code.
(c) National Vessel Documentation Center shall mean the National Vessel
Documentation Center of the United States Coast Guard, at Falling Waters, West
Virginia.
SECTION 1.02. Rules of Construction. Unless the context clearly indicates
to the contrary, the following rules shall apply to the construction of this
Mortgage.
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(a) Words importing the singular number shall include the plural number and
vice versa.
(b) All references herein to particular articles or sections, unless
otherwise provided, are references to articles or sections of this Mortgage.
(c) The headings herein are solely for convenience of reference and shall
not constitute a part of this Mortgage nor shall they affect its meaning,
construction or effect.
(d) References to the Note, and other agreements and/or instruments shall
be deemed to refer to such Note, agreements and instruments as the same may
from time to time be amended, supplemented or modified by the parties hereto
in accordance with the terms thereof.
(e) To the extent there is an inconsistency between the terms of the
Security Agreement executed by the parties hereto on the date hereof, and the
terms of this Mortgage, then the terms of the Security Agreement shall
control.
ARTICLE II
GENERAL MORTGAGE PROVISIONS
SECTION 2.01. Secured Amount.
(a) For purposes of this Mortgage and in order to comply with Title 46,
Section 31321(b)(3) of the United States Code, the parties to this Mortgage
hereby declare that the Indebtedness secured hereby as of the date hereof is
the sum of FIVE MILLION, EIGHT HUNDRED, TWENTY-SEVEN THOUSAND FIVE HUNDRED AND
NO/100 DOLLARS ($5,827,500.00), as the principal amount of Indebtedness
together with performance of mortgage covenants. The discharge amount is the
same as the total amount, together with interest, attorneys' fees, costs and
other expenses and performance of mortgage covenants.
(b) It is not intended that this Mortgage include any property other than
the Barge, as defined in the Granting Clause hereto, but should any
determination be made at any time for any reason that this Mortgage includes
any property other than a "vessel," then if such property is comprised of
incidental equipment, such property may be separately discharged from the lien
of this Mortgage by the payment of one-one hundredth of one percent of the
total amount of the Note then remaining unpaid.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MORTGAGOR
The Mortgagor represents, warrants, covenants and agrees with Mortgagee as
follows:
SECTION 3.01. Status of Mortgagor. Mortgagor is a corporation organized
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and existing under and by virtue of the laws of the State of Mississippi;
Mortgagor is and will remain a citizen of the United States of America within
the meaning of Title 46, Xxxxxxx 000, xx xxx Xxxxxx Xxxxxx Code, entitled to
own and operate the Barge and to engage in the coastwise trade; Mortgagor is
duly authorized to mortgage the Barge; all action necessary and required by
law for the execution and delivery of this Mortgage has been duly and
effectively taken; and this Mortgage is a valid and binding obligation of
Mortgagor enforceable in accordance with its terms.
SECTION 3.02. Liens. The following liens on the Barge arising after the
date hereof shall be permitted except to the extent that there exists for such
liens a notice of seizure or sale or an advertisement for seizure or sale:
(a) Liens for taxes, assessments, or other governmental charges not yet due
or which are being contested in good faith by appropriate action promptly
initiated and diligently conducted, if such reserve as shall be required by
generally accepted accounting principles shall have been made therefor;
(b) Liens of lessors (subordinated), carriers, warehousemen, mechanics,
laborers and materialmen arising by law in the ordinary course of business for
sums either not yet due or being contested in good faith by appropriate action
promptly initiated and diligently conducted, if such reserve as shall be
required by generally accepted accounting principles shall have been made
therefor;
(c) Liens (i) for crew's wages (1) for fifteen (15) days after the
termination of a voyage, or (2) which shall then be contested in good faith by
appropriate action promptly initiated and diligently conducted, if such
reserve as shall be required by generally accepted accounting principles shall
have been made therefor, (ii) for general average (1) which are unclaimed, (2)
for fifteen (15) days after having been claimed, (3) which are covered by
insurance, or (4) which shall then be contested in good faith by appropriate
action promptly initiated and diligently conducted, if such reserve as shall
be required by generally accepted accounting principles shall have been made
therefor, (iii) for salvage, whether voluntary or contract, (1) which are
unclaimed, (2) for fifteen (15) days after having been claimed, (3) which are
covered by insurance, or (4) which shall then be contested in good faith by
appropriate action promptly initiated and diligently conducted, if such
reserve as shall be required by generally accepted accounting principles shall
have been made therefor, (iv) otherwise incident to the then current
operations of the Barge, for the wages of a stevedore when employed directly
by Mortgagor, or the operator, master or agent of the Barge, (v) covered by
insurance and any deductible applicable thereto, (vi) for repairs or with
respect to any changes made in or on the Barge (1) which are unclaimed, (2)
for fifteen (15) days after having been claimed, (3) which are covered by
insurance, or (4) which shall then be contested in good faith by appropriate
action promptly initiated and diligently conducted, if such reserve as shall
be required by generally accepted accounting principles shall have been made
therefor, and (vii) for necessaries (1) which are unclaimed, (2) for fifteen
(15) days after having been claimed, (3) which are covered by insurance, or
(4) which shall then be contested in good faith by appropriate action promptly
initiated and diligently conducted, if such reserve as shall be required by
generally accepted accounting principles shall have been made therefor;
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(d) Permitted Liens, as that term is defined in the Security Agreement of
even date herewith (the "Security Agreement") between Mortgagor and Mortgagee,
as it may from time to time be amended, modified or supplemented; and
(e) Liens listed on the General Index or Abstract of Title relative to the
Barge attached hereto on Exhibit "B" and not removed by Mortgagee.
SECTION 3.03. Compliance With Law. Mortgagor will comply with and satisfy
all applicable formalities and provisions of the laws and regulations of the
United States of America, and any supplement or amendment thereto, in order to
perfect, establish and maintain this Mortgage as a preferred mortgage upon the
Barge and upon all renewals, improvements and replacements made in or to the
Barge. Mortgagor shall furnish to Mortgagee, from time to time, such proofs
as Mortgagee may reasonably request with respect to Mortgagor's compliance
with the foregoing covenant. Mortgagor shall promptly pay and discharge all
United States Coast Guard fees and expenses in connection with the recordation
of this Mortgage and any supplement or amendment thereto. In the event that
this Mortgage, the Note secured hereby, or any provisions hereof or thereof,
shall be deemed invalidated in whole or in part by reason of any present or
future law or any decision of any court, Mortgagor will execute such other and
further assurances and documents as in the opinion of Mortgagee may be
required to more effectually subject the Barge to the payment and the
performance of the terms and provisions of this Mortgage and the Note. In
addition, Mortgagor will furnish to Mortgagee such additional information as
Mortgagee may reasonably require.
SECTION 3.04. Operation of Barge. Mortgagor will not cause or permit the
Barge to be operated in any manner contrary to law and Mortgagor will not
engage in any unlawful trade or violate any law or carry any cargo that will
expose the Barge to penalty, forfeiture or capture, and will not do, or suffer
or permit to be done, anything which can or may injuriously affect the
registration or enrollment or flag of the Barge under the laws and regulations
of the United States of America.
SECTION 3.05. Payment of Taxes, etc. Mortgagor will pay as and when due
and payable all taxes, levies, license fees, assessments, and other
impositions levied on the Barge or any part thereof before its use and
operation or which otherwise, if unpaid, might become a Lien upon the Barge;
provided, that Mortgagor shall not be required to pay any such tax, levee,
fee, assessment or imposition if the amount, applicability or validity thereof
shall currently be contested in good faith by appropriate proceedings
diligently conducted and if Mortgagor shall have set up reserves therefor
adequate under generally accepted accounting principles (provided that such
reserves may be set up under generally accepted accounting principles);
provided, further, that any such contest shall prevent the posting for sale or
the sale of the Barge under special execution or otherwise for the payment of
any such tax, levee, fee, assessment or imposition, or other forfeiture or
loss of title to the Barge.
SECTION 3.06. Notice of Mortgage. Mortgagor will place, and at all times
will retain on board the Barge a properly certified copy of this Mortgage, a
Notice of this Mortgage and the Certificate of Documentation of the Barge.
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SECTION 3.07. Release From Arrest. If the Barge is attached, arrested,
levied upon or taken into custody by virtue of any legal proceeding in any
court, Mortgagor will promptly notify Mortgagee thereof by telegraph,
confirmed by letter, and within ten (10) working days will cause the Barge to
be released by posting such security as may be acceptable to the court in
which such proceedings are pending, and will promptly notify Mortgagee thereof
in the manner aforesaid.
SECTION 3.08. Maintenance of Barge. Mortgagor will at its own expense at
all times maintain, preserve and keep the Barge in good condition, working
order and repair and will from time to time make all needful and proper
repairs, renewals, replacements, betterments and improvements. The Barge
shall, and Mortgagor covenants that it will, at all times comply with all
applicable laws, treaties and covenants and rules and regulations issued
thereunder. Mortgagor will not make, or permit to be made, any substantial
change in the structure, type, name, or rig of the Barge without first
receiving written approval thereof from Mortgagee, which approval shall not be
unreasonably withheld.
SECTION 3.09. Access to Barge. Mortgagor at all reasonable times will
afford Mortgagee or its authorized representatives full and complete access to
the Barge for the purpose of inspecting the same and its cargo and papers.
SECTION 3.10. Documentation of Barge. Mortgagor will keep the Barge duly
documented as a vessel of the United States of America and entitled to engage
in the operations conducted by the Mortgagor. Mortgagor will never operate
the Barge outside the navigation limits of the insurance carried pursuant to
Section 3.12 of Article III of this Mortgage.
SECTION 3.11. Sale, Charter, Mortgage, or Release of Barge. Mortgagor will
not sell, mortgage, transfer, or demise charter the Barge or enter into any
arrangement or contract with respect to the Barge which might be construed as
a financing lease, without the written consent of Mortgagee first had and
obtained, which consent shall not be unreasonably withheld; and any such
written consent to any one sale, mortgage, transfer, or demise charter shall
not be construed to be a waiver of this provision in respect of any subsequent
proposed sale, mortgage, transfer, or demise charter. Any such sale,
mortgage, transfer, or demise charter of the Barge shall be subject to the
provisions of this Mortgage and the lien it creates, unless released therefrom
by Mortgagee. Nothing herein shall in any way limit the ability of Mortgagor
to sell equipment in accordance with the Security Agreement.
SECTION 3.12 Insurance.
(a) Mortgagor will cause to be carried and maintained on the Barge, without
expense to Mortgagee, insurance in such amounts, against such risks
(including, without limitation, pollution, fire, public liability, excess
liability and umbrella coverages, property damage, and workmen's
compensation), in such form, including without limitation the form of the loss
payable clause (naming Mortgagee and Mortgagor as loss payee), cancellation
clause, navigation limits, and the designation of named assured, and with such
insurance companies, insurers, underwriters or funds, and on such policy
forms, as Mortgagee shall from time to time approve. In no event shall the
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Hull value on the Barge be less than the outstanding amount of Indebtedness
under the Note. In no event shall the protection and indemnity insurance,
including umbrella coverage, on the Barge be less than $7,000,000. Such
insurance coverage policies shall contain an agreement by the insurer not to
cancel or amend the policies without giving Mortgagee at least 30 days' prior
written notice of its intention to do so.
(b) Payments in respect of any loss under insurance carried pursuant to
this Section 3.12 shall be made to Mortgagor and Mortgagee, as their
respective interests may appear.
(c) If any claim or lien is asserted against the Barge for loss, damage or
expense which is covered by insurance required hereunder and it is necessary
for Mortgagor to obtain a bond or supply other security to prevent arrest of
the Barge or to release the Barge from arrest on account of such claim or
lien, Mortgagee, on request of the Mortgagor, may, in the sole discretion of
Mortgagee, assign to any person, firm or corporation executing a surety or
guarantee bond or other agreement to save or release the Barge from such
arrest, all right, title and interest of Mortgagee in and to said insurance
covering said loss, damage or expense, as collateral security to indemnify
against liability under said bond or other agreement.
(d) Mortgagor will deliver to Mortgagee whenever so requested by Mortgagee
certified copies of all cover notes, binders and policies for the purpose of
inspection.
(e) Mortgagor agrees that it will not execute or permit or willingly allow
to be done any act by which any insurance may be suspended, impaired or
canceled, and that he will not permit or allow the Barge to undertake any
voyage, engage in any venture or run any risk or transport any cargo which may
not be permitted by the policies in force, without having previously insured
such Barge by additional coverage to extend to such voyages, ventures, risks
or cargoes.
SECTION 3.13. Payments by Mortgagee. At any time during the term of this
Mortgage, Mortgagee may, but shall not be required to, upon five days' notice
to Mortgagor, pay the costs of all insurance and all expenses of protecting
storing, warehousing, handling and maintaining the Barge, any and all excise,
property, sales, use, gaming and other taxes imposed by any federal, state or
local authority on the Barge, or any costs associated with maintaining the
rank of this Mortgage. Mortgagor will promptly reimburse Mortgagee for any
such payment unless (a) Mortgagor notifies Mortgagee within five days of
receiving notice that Mortgagee intends to pay any such expenses that such
expenses have been paid or are not due and (b) such expenses have, in fact,
been paid or are not legally due. All sums so paid or incurred by Mortgagee
for any of the foregoing and any and all other sums for which Mortgagor may
become liable hereunder and all costs and expenses (including reasonable
attorneys' fees, legal expenses and court costs) incurred by Mortgagee in
enforcing or protecting any of its rights or remedies under this Mortgage,
shall, together with interest thereon until paid at the rate of twelve percent
(12.0%) per annum, and Mortgagee agrees to pay all of the foregoing sums
promptly.
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SECTION 3.15. Requisition of Barge but not Title. If the United States of
America or any government of any other country or any department, agency or
representative thereof shall not take the title or ownership of the Barge but
shall requisition, charter, or in any manner take over the use of the Barge
pursuant to any present or future law, proclamation, decree, order or
otherwise, and in the event Mortgagor is in default of the terms of this
Mortgage, all charter hire and compensation resulting therefrom shall be
payable to Mortgagee, and if, as a result of such requisitioning, chartering
or taking of the use of the Barge such government, department, agency or
representative thereof shall pay or become liable to pay any sum by reason of
the loss of or injury to or depreciation of the Barge any such sum is hereby
made payable to Mortgagee, who shall be entitled to receive the same and shall
apply any such sums referred to in this Section 3.15 to the payment of the
Note; and in the event of any such requisitioning, chartering or taking of the
use of the Barge, Mortgagor shall promptly execute and deliver to Mortgagee
such documents, if any, and shall promptly do and perform such acts, if any,
as in the opinion of counsel for Mortgagee may be necessary or useful to
facilitate or expedite the collection by Mortgagee of such claims arising out
of the requisitioning, chartering or taking of the use of the Barge.
ARTICLE IV
EVENTS OF DEFAULT AND REMEDIES
SECTION 4.01.
A. Events of Default. In case any one or more of the following events,
herein termed "Events of Default," shall happen:
(1) Default in the payment of principal of the Note as and when the same
shall become due and payable and such default continues unremedied for ten
(10) days; or
(2)Default in the due and punctual observance and performance of any
provisions of Sections 3.01, 3.03, 3.04, 3.07, 3.09, 3.10, 3.11, 3.12, 3.13,
3.14 or 3.15 of Article III; or default in the due and punctual observance and
performance of any provisions of Section 3.05 of Article III hereof and such
default shall continue for fifteen (15) days; or
(3) Default in the due observance or performance of any of the other
covenants and conditions herein, in the Sale Agreement, in the exhibits
thereto, as executed and/or in the Note required to be kept and performed, and
continuance of such default for fifteen (15) days after written notice by
Mortgagee; provided, however, that Mortgagor shall not be deemed to be in
default for failure to keep the Barge in good condition, working order and
repair pursuant to Section 3.08 of Article III if Mortgagor shall be
diligently taking steps to comply with the requirements of said Section; or
(4) Any representations and warranties made in this Mortgage are untrue
in any material respect; or
(5) Mortgagor shall (i) abandon the Barge without due cause; or (ii)
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cease to be a citizen of the United States of America within the meaning of
Title 46, Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Code entitled to employ the Barge
in the trade in which it is engaged; or
(6) Mortgagor shall apply for or consent to the appointment of a receiver
or trustee of Mortgagor or for the Barge; or
(7) An order, judgment or decree shall be entered, without the
application, approval or consent of Mortgagor, by any court of competent
jurisdiction, approving a petition appointing a receiver or trustee of
Mortgagor or for the Barge, and such order, judgment or decree shall continue
unstayed and in effect for a period of thirty (30) days; or
(8) The title or ownership of the Barge shall be requisitioned, purchased
or taken by the government of any country or by any department, agency or
representative thereof and there shall not have been paid to Mortgagee an
amount in cash in United States dollars equal to the fair value of the Barge
within ninety (90) days after such event occurs; or
(9) The Barge is posted for foreclosure or notice of a sale to satisfy a
lien on the Barge is given as required by applicable law; or
(10) Mortgagee receives notice of cancellation of insurance on the Barge
in accordance with the required time restriction agreed to by the insurance
company and such insurance is not replaced prior to the effective date of the
cancellation; or
(11) Any "Event of Default" occurs under the Security Agreement.
B. Remedies. Then and in each and every such case Mortgagee shall have the
right to:
(1) Declare all the then unpaid principal sum of the Note to be due and
payable immediately, and upon such declaration the same with any delinquent
interest payment, as provided for in the Note, to date of declaration shall
become due and be immediately due and payable;
(2) Exercise all the rights and remedies in foreclosure and otherwise
given to Mortgagee by the laws and regulations of the United States of America
or of the country wherein the Barge shall then be found or of any country
wherein the Barge may thereafter be found or of any other applicable
jurisdiction;
(3) Bring suit at law, in equity or in admiralty, as it may be advised,
to recover judgment for any and all amounts due under the Note and this
Mortgage, or otherwise hereunder, and collect the same from Mortgagor and/or
out of any and all property of Mortgagor whether covered by this Mortgage or
otherwise;
(4) Take the Barge without legal process wherever the same may be; and
Mortgagor or other person in possession, forthwith upon demand of Mortgagee
shall surrender to Mortgagee possession of the Barge and Mortgagee may,
without being responsible for loss or damage, hold, lay up, lease, charter,
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operate or otherwise use the Barge for such time and upon such terms as it may
deem to be for its best advantage, accounting only for the net profits, if
any, arising from such use of the Barge and charging upon all receipts from
the use of the Barge or from the sale thereof by court proceedings or pursuant
to Subsection (5) of this Section 4.01 next following, all costs, expenses,
charges, damages or losses by reason of such use; and if at any time Mortgagee
shall avail itself of the right herein given it to take the Barge, Mortgagee
shall have the right to dock the Barge for a reasonable time at any dock,
pier, or other premises of Mortgagor without charge, or to dock it at any
other place at the cost and expense of the Mortgagor;
(5) Without being responsible for loss or damage, sell the Barge at any
place and at such time as Mortgagee may specify and in such manner as
Mortgagee may deem advisable free from any claim by the Mortgagor in
admiralty, in equity, at law or by statute, after first giving notice of the
time and place of sale with a general description of the property in the
following manner:
(a) By publishing such notice for three (3) consecutive days, within
ten (10) days prior to the sale, in a daily newspaper of general circulation
published in Biloxi, Mississippi;
(b) If the place of sale should not be Biloxi, Mississippi, then by
publication of such notice in a daily newspaper, if any, published at the
place of sale; and
(c) By mailing a similar notice to Mortgagor on the day of first
publication; Mortgagee may adjourn any such sale from time to time by
announcement at the time and place appointed for such sale or for such
adjourned sale, and without further notice or publication Mortgagee may make
any such sale at the time and place to which the same shall be so adjourned.
Any such sale may be conducted without bringing the Barge to be sold to the
place designated for such sale and in such manner as Mortgagee may deem to be
for its best advantage.
(6) Mortgagor hereby consents to the appointment of a consent keeper by
Mortgagee with the costs thereof to be a cost of the sale to be paid from the
proceeds of the sale or by Mortgagor.
SECTION 4.02. Sale of Barge by Mortgagee. Any sale of the Barge made in
pursuance of this Mortgage, whether under the power of sale hereby granted or
any judicial proceedings, shall operate to divest all right, title and
interest of any nature whatsoever of Mortgagor therein and thereto, and shall
bar Mortgagor, its successors and assigns, and all persons claiming by,
through or under them. At any such sale Mortgagee or any other holder of the
Note (the "holder/purchaser") may bid for and purchase the Barge and upon
compliance with the terms of sale may hold, retain and dispose of such
property without further accountability therefor. In case of any such sale
the holder/purchaser shall be entitled, for the purpose of making settlement
or payment for the property purchased, to use and apply the Note or any
portion thereof in order that there may be credited against the amount
remaining due and unpaid thereon the sums payable to the holder/purchaser out
of the net proceeds of such sale after allowing for the costs and expense of
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sale and other charges; and thereupon the holder/purchaser shall be credited,
on account of such purchase price, with the net proceeds that shall have been
so credited upon the Note. No purchaser shall be bound to inquire whether
notice has been given, or whether any default has occurred, or as to the
propriety of the sale or as to the application of the proceeds thereof.
SECTION 4.03. Mortgagee to Sign for Mortgagor. Mortgagee is hereby
appointed attorney-in-fact of Mortgagor to execute and deliver to any
purchaser aforesaid and is hereby vested with full power and authority to
make, in the name and in behalf of Mortgagor, a good conveyance of the title
to the Barge so sold. In the event of any sale of the Barge, under any power
herein contained, Mortgagor will, if and when required by Mortgagee, execute
such form of conveyance of such Barge as Mortgagee may direct or approve.
SECTION 4.04. Mortgagee to Collect Hire, etc. Mortgagee is hereby
appointed attorney-in-fact of Mortgagor upon the happening of any Event of
Default, in the name of Mortgagor to demand, collect, receive, compromise and
xxx for, so far as may be permitted by law, all amounts due from underwriters
under any insurance thereon as payment of losses or as return premiums or
otherwise, salvage awards and recoveries, recoveries in general average or
otherwise, and all other sums, due or to become due at the time of the
happening of any Event of Default in respect of the Barge, or in respect of
any insurance thereof from any person whomsoever, and to make, give and
execute in the name of Mortgagor acquittances, receipts, releases, or other
discharges for the same, whether under seal or otherwise, and to endorse and
accept in the name of Mortgagor all checks, notes, drafts, warrants,
agreements and all other instruments in writing with respect to the foregoing.
All amounts so received shall first be applied to operating expenses and then
to unpaid interest and then to unpaid principal on the Note.
SECTION 4.05. Mortgagee's Right to Possession. Whenever any right to enter
and take possession of the Barge accrues to Mortgagee, it may require
Mortgagor to deliver, and Mortgagor shall on demand, at its own cost and
expense, deliver the Barge to Mortgagee as demanded. If any legal proceedings
shall be taken to enforce any right under this Mortgage, Mortgagee shall be
entitled as a matter of right to the appointment of a receiver of the Barge
and the freights, hire, earnings, issues, revenues, income and profits due or
to become due and arising from the operation thereof.
SECTION 4.06. Appearance by Mortgagee on Behalf of Mortgagor. Mortgagor
authorizes and empowers Mortgagee or its appointees or any of them to appear
in the name of Mortgagor, its successors and assigns, in any court of any
country or nation of the world where a suit is pending against the Barge
because of or on account of any alleged lien against the Barge from which the
Barge has not been released and to take such proceedings as to them or any of
them may seem proper towards the defense of such suit and the discharge of
such lien, in the event that the Mortgagor shall not be taking proceedings
reasonably satisfactory to Mortgagee, and in such case all expenditures made
or incurred by Mortgagee or his appointees for the purpose of such defense or
discharge shall be a debt due from the Mortgagor, its successors and assigns,
to Mortgagee, and shall be secured by the lien of this Mortgage in like manner
and extent as if the amount and description thereof were written herein.
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SECTION 4.07. Acceleration of Indebtedness Secured Hereby. Mortgagor
covenants that upon the happening of any one or more of the Events of Default,
then upon written demand of Mortgagee, the Mortgagor will pay to Mortgagee the
whole of the indebtedness then owed under Note secured hereby and under this
Mortgage, and in case the Mortgagor shall fail to pay the same forthwith upon
such demand, Mortgagee shall be entitled to recover judgment for the whole
amount so due and unpaid, together with such further amounts as shall be
sufficient to cover the reasonable costs and expenses of collection, including
a reasonable compensation to Mortgagee's agents, attorneys and counsel and any
necessary advances, expenses and liabilities made or incurred by them
hereunder. All moneys collected by Mortgagee under this Section shall be
applied by Mortgagee in accordance with the provisions of Section 4.11 of this
Article IV.
SECTION 4.08. Right of Mortgagee. Each and every power and remedy herein
given to Mortgagee shall be cumulative and shall be in addition to every other
power and remedy herein given or now or hereafter existing at law, in equity,
in admiralty or by statute, and each and every power and remedy whether herein
given or otherwise existing may be exercised from time to time and as often
and in such order as may be deemed expedient by Mortgagee, and the exercise or
the beginning of the exercise of any power to remedy shall not be construed to
be a waiver of the right to exercise at the same time or thereafter any other
power or remedy. No delay or omission by Mortgagee in the exercise of any
right or power or in the pursuance of any remedy accruing upon any Event of
Default shall impair any such right, power or remedy or construed to be a
waiver of any such Event of Default or to be any acquiescence therein; nor
shall the acceptance by Mortgagee of any security or of any payment of or on
account of the Note after any Event of Default or of any payment on account of
any past default be construed to be a waiver of any right to take advantage of
any future Event of Default or of any past Event of Default not completely
cured thereby.
SECTION 4.09. Restoration of Position. In case Mortgagee shall have
proceeded to enforce any right, power or remedy under this Mortgage by
foreclosure, entry or otherwise, and such proceedings shall have been
discontinued or abandoned for any reason or shall have been determined
adversely to Mortgagee, then and in every such case Mortgagor and Mortgagee
shall be restored to their former positions and rights hereunder with respect
to the property subject or intended to be subject to this Mortgage, and all
rights, remedies and powers of Mortgagee shall continue as if no such
proceedings had been taken.
SECTION 4.10. Proceeds of Sale. The proceeds of any sale of the Barge and
the net earnings from the hire or from any charter, operation or other use of
the Barge by Mortgagee under any of the powers herein specified and any and
all other money received by Mortgagee pursuant to or under the terms of this
Mortgage or in any proceedings hereunder, the application of which has not
elsewhere herein been specifically provided, shall be applied at the
discretion of Mortgagee with Mortgagee having the right to impute payments as
it may desire among the following:
FIRST: To the payment of all reasonable expenses and charges, including
the expenses of any sale, and expenses of any retaking, attorney's fees, court
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costs, keeper's fees, necessary repairs and any other expenses or advances
made or incurred by Mortgagee in the protection of its rights or the pursuance
of its remedies hereunder, and to provide adequate indemnity against liens
claiming priority over or equality with the lien of this Mortgage;
SECOND: To the payment in full of any amount then unpaid and accrued and
due as a deficiency payment pursuant to the terms of the Note.
THIRD: To the payment in full of any amount then unpaid and accrued and
due as principal pursuant to the terms of the Note.
FOURTH: To the payment of any other amounts remaining unpaid and accrued
and due Mortgagee by Mortgagor on this Mortgage.
FIFTH: To the payment of any surplus thereafter remaining to Mortgagor or
to whomsoever may be entitled thereto.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.01. Notice. Any notice to be given under this Mortgage shall,
except as otherwise expressly provided herein, be served by registered or
certified mail, overnight express mail, or hand delivered, addressed as
follows:
(a) To Mortgagor:
The President Riverboat Casino-Mississippi, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
with copies to:
Xxxxx X. O'Xxxx
Xxxxxx Xxxxxx, L.L.P.
Xxxxx 000, XxxXxx Xxxxxx
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
Xxxxxxxx Xxxxxx
Xxxxxx Xxxxxx, L.L.P.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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(b) To Mortgagee:
American Gaming & Entertainment, Ltd.
Xxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000
with copies to:
Xxxxxx X. Xxxx, Esq.
Xxxx & Wiser
X.X. Xxx 0000
Xxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxxx X. Xxxxx, Esq.
Xxxxx & Xxxxx, L.L.P.
0000 Xxxx Xxx., Xxx. 000
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Shamrock Holdings Group, Inc.
Xxx Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
X. Xxxxxx Xxxxxxx, Esq.
Xxxxxxxxx, Xxxxx & Xxx, P.C.
0000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxxxx X. Xxxx, Esq.
X.X. Xxx 0000
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxx Xxxxxxx, Esq.
Rimmer, Rawlings, XxxXxxxx
& Xxxxxxx
0000 Xxxxxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
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Xxxxxxx X. Xxxxxx, Esq.
Heller, Draper, Hayden, Horn, L.L.C.
000 Xxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xx. 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
unless another address shall be furnished in writing by the party to receive
such notice to the party giving such notice, and any such notice shall be
deemed made as of the date of mailing or hand delivery.
SECTION 5.02. Counterparts. This Mortgage may be executed in any number of
counterparts and all such counterparts executed and delivered each as an
original shall constitute but one and the same instrument.
SECTION 5.03. Interest of Mortgagor. The interest of Mortgagor in the
Barge and the interest mortgaged by this Mortgage is that of one hundred
percent (100%) absolute and sole ownership.
SECTION 5.04. Survivorship of Covenants. All the covenants, promises,
stipulations and agreements of Mortgagor in this Mortgage and the Note
contained shall bind Mortgagor and its successors and assigns and shall inure
to the benefit of Mortgagee and its successors and assigns.
SECTION 5.05. Amendments. This Mortgage may not be modified, extended,
supplemented or amended in any respect, or any waiver given in regard to any
of the provisions hereof, in any case which might affect the rights of
Mortgagee hereunder, except with the written consent of Mortgagee, and so long
as Mortgagor shall do all acts and things necessary to maintain the preferred
status of this Mortgage.
SECTION 5.06. Discharge of Lien. When the Note has been paid in full,
including all costs, expenses and attorneys' fees provided for therein,
Mortgagee shall, at Mortgagor's expense, execute and deliver to Mortgagor such
documents as Mortgagor shall reasonably request to evidence the surrender and
discharge of the lien hereof upon the Barge.
SECTION 5.07. Incorporation into Mortgage. The Whereas Clauses and the
Granting Clause of this Mortgage are incorporated in and are made a part of
this Mortgage.
SECTION 5.08. Governing Law. This Mortgage shall be governed by and
construed according to the provisions of the Act, and where silent, by the
General Maritime Law of the United States.
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WHEREFORE, the Mortgagor has executed this Preferred Ship Mortgage in
multiple original counterparts on the day and year first above written.
THE PRESIDENT RIVERBOAT CASINO-
MISSISSIPPI, INC.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
EXHIBIT "A"
[Note attached.]
EXHIBIT "B"
[General Index and Abstract of Title attached - see Section 3.02.]
