EXHIBIT 10.52
EXHIBIT VIII
[FORM OF COLLATERAL ACCOUNT AGREEMENT]
COLLATERAL ACCOUNT AGREEMENT
This COLLATERAL ACCOUNT AGREEMENT (this "Agreement") is dated
as of August 25, 1995 and entered into by and between PLAYERS INTERNATIONAL,
INC., a Nevada corporation ("Pledgor"), and FIRST INTERSTATE BANK OF NEVADA,
N.A. ("FIB"), as administrative agent for and representative of (in such
capacity herein called "Secured Party") the financial institutions ("Lenders")
party to the Credit Agreement (as hereinafter defined).
PRELIMINARY STATEMENTS
A. Secured Party, Lenders, FIB and Bankers Trust Company, as
Managing Agents, and FIB and BT Securities Corporation, as Co-Arrangers, have
entered into a Credit Agreement dated as of August 25, 1995 (said Credit
Agreement, as it may hereafter be amended, supplemented or otherwise modified
from time to time, being the "Credit Agreement", the terms defined therein and
not otherwise defined herein being used herein as therein defined) with Pledgor
pursuant to which Lenders have made certain commitments, subject to the terms
and conditions set forth in the Credit Agreement, to extend certain credit
facilities to Pledgor.
B. It is a condition precedent to the initial extensions of
credit by Lenders under the Credit Agreement that Pledgor shall have granted the
security interests and undertaken the obligations contemplated by this
Agreement.
NOW, THEREFORE, in consideration of the premises and in order
to induce Lenders to make Loans and issue Letters of Credit under the Credit
Agreement and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Pledgor hereby agrees with Secured
Party as follows:
SECTION 1. Certain Definitions. The following terms used in
this Agreement shall have the following meanings:
"Collateral" means (i) the Collateral Account, (ii) all amounts
on deposit from time to time in the Collateral Account, (iii) all interest,
cash, instruments, securities and other
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property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Collateral, and (iv) to the
extent not covered by clauses (i) through (iii) above, all proceeds of any or
all of the foregoing Collateral.
"Collateral Account" means the restricted deposit account
established and maintained by Pledgor with Secured Party pursuant to Section
2(a).
"Secured Obligations" means all obligations and liabilities of
every nature of Pledgor now or hereafter existing under or arising out of or in
connection with the Credit Agreement and the other Loan Documents and all
extensions or renewals thereof, whether for principal, interest (including
without limitation interest that, but for the filing of a petition in bankruptcy
with respect to Pledgor, would accrue on such obligations), reimbursement of
amounts drawn under Letters of Credit, fees, expenses, indemnities or otherwise,
whether voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and whether
or not from time to time decreased or extinguished and later increased, created
or incurred, and all or any portion of such obligations or liabilities that are
paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from Secured Party or any Lender as a preference, fraudu-
lent transfer or otherwise, and all obligations of every nature of Pledgor now
or hereafter existing under this Agreement.
SECTION 2. Establishment and Operation of Collateral Account.
(a) Pledgor hereby authorizes and directs Secured Party to
establish and maintain at its office at the Funding and Payment Office, as a
blocked account in the name of Pledgor but under the sole dominion and control
of Secured Party, a restricted deposit account designated as "Players
International, Inc. Collateral Account".
(b) The Collateral Account shall be operated in accordance with
the terms of this Agreement.
(c) Secured Party shall be fully protected and shall suffer no
liability in acting in accordance with any written instructions reasonably
believed by it to have been given by Pledgor with respect to any aspect of the
operation of the Collateral Account.
(d) Anything contained herein to the contrary notwithstanding, the
Collateral Account shall be subject to such applicable laws, and such applicable
regulations of the Board of Governors of the Federal Reserve System and of any
other appropriate banking or governmental authority, as may now or hereafter be
in effect.
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SECTION 3. Deposits of Cash Collateral.
(a) All deposits of funds in the Collateral Account shall be made
by wire transfer (or, if applicable, by intra-bank transfer from another account
of Pledgor) of immediately available funds, in each case addressed as follows:
Account No.:
ABA No.:
Reference:
Attention:
Pledgor shall, promptly after initiating a transfer of funds to the Collateral
Account, give notice to Secured Party by telefacsimile of the date, amount and
method of delivery of such deposit.
(b) If an Event of Default has occurred and is continuing and, in
accordance with Section 8 of the Credit Agreement, Pledgor is required to pay to
Secured Party an amount (the "Aggregate Available Amount") equal to the maximum
amount that may at any time be drawn under all Letters of Credit then
outstanding under the Credit Agreement, Pledgor shall deliver funds in such an
amount for deposit in the Collateral Account in accordance with Section 3(a). If
for any reason the aggregate amount delivered by Pledgor for deposit in the
Collateral Account as aforesaid is less than the Aggregate Available Amount, the
aggregate amount so delivered by Pledgor shall be apportioned among all
outstanding Letters of Credit for purposes of this Section 3(b) in accordance
with the ratio of the maximum amount available for drawing under each such
Letter of Credit (as to such Letter of Credit, the "Maximum Available Amount")
to the Aggregate Available Amount. Upon any drawing under any outstanding Letter
of Credit in respect of which Pledgor has deposited in the Collateral Account
any amounts described above, Secured Party shall apply such amounts to reimburse
itself, as Administrative Agent, for the amount of such drawing. In the event of
termination, cancellation or expiration of any Letter of Credit in respect of
which Pledgor has deposited in the Collateral Account any amounts described
above, or in the event of any reduction in the Maximum Available Amount under
such Letter of Credit, Secured Party shall apply the amount then on deposit in
the Collateral Account in respect of such Letter of Credit (less, in the case of
such a reduction, the Maximum Available Amount under such Letter of Credit
immediately after such reduction) first, to the payment of any amounts payable
to Secured Party pursuant to Section 13, second, to the extent of any excess, to
the cash collateralization pursuant to the terms of this Agreement of any
outstanding Letters of Credit in respect of which Pledgor has failed to pay all
or a portion of the amounts described above (such cash collateralization to be
apportioned among all such Letters of Credit in the manner described above),
third, to the extent of any further excess, to the payment of any other
outstanding Secured Obligations, and fourth, to the extent of any further
excess, to the payment to whomsoever shall be lawfully entitled to receive such
funds.
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SECTION 4. Pledge of Security for Secured Obligations. Pledgor
hereby pledges and assigns to Secured Party, and hereby grants to Secured Party
a security interest in, all of Pledgor's right, title and interest in and to the
Collateral as collateral security for the prompt payment or performance in full
when due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including the payment of amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code, 11 U.S.C. ss.362(a)), of all Secured Obligations.
SECTION 5. No Investment of Amounts in the Collateral Account;
Interest on Amounts in the Collateral Account.
(a) Cash held by Secured Party in the Collateral Account shall not
be invested by Secured Party but instead shall be maintained as a cash deposit
in the Collateral Account pending application thereof as elsewhere provided in
this Agreement.
(b) To the extent permitted under Regulation Q of the Board of
Governors of the Federal Reserve System, any cash held in the Collateral Account
shall bear interest at the standard rate paid by Secured Party to its customers
for deposits of like amounts and terms.
(c) Subject to Secured Party's rights under Section 12, any
interest earned on deposits of cash in the Collateral Account in accordance with
Section 5(b) shall be deposited directly in, and held in the Collateral Account
and applied in accordance with Section 3(b).
SECTION 6. Representations and Warranties. Pledgor represents and
warrants as follows:
(a) Ownership of Collateral. Pledgor is (or at the time of
transfer thereof to Secured Party will be) the legal and beneficial owner of the
Collateral from time to time transferred by Pledgor to Secured Party, free and
clear of any Lien except for the security interest created by this Agreement.
(b) Governmental Authorizations. No authorization, approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the grant by Pledgor of the security
interest granted hereby, (ii) the execution, delivery or performance of this
Agreement by Pledgor, or (iii) the perfection of or the exercise by Secured
Party of its rights and remedies hereunder (except (i) the report required to be
filed by Pledgor pursuant to Nevada Gaming Commission Regulation 8.130, (ii)
authorization from any Gaming Authorities for the exercise by Secured Party of
certain of its rights and remedies hereunder, and (iii) as may have been taken
by or at the direction of Pledgor).
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(c) Perfection. The pledge and assignment of the Collateral
pursuant to this Agreement creates, to the extent permitted by applicable law
(including Gaming Laws) a valid and perfected first priority security interest
in the Collateral, securing the payment of the Secured Obligations.
(d) Other Information. All information heretofore, herein or
hereafter supplied to Secured Party by or on behalf of Pledgor with respect to
the Collateral is accurate and complete in all respects.
SECTION 7. Further Assurances. Pledgor agrees that from time to
time, at the expense of Pledgor, Pledgor will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable, or that Secured Party may request, in order to perfect
and protect any security interest granted or purported to be granted hereby or
to enable Secured Party to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, Pledgor will: (a) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or notices, as may
be necessary or desirable, or as Secured Party may request, in order to perfect
and preserve the security interests granted or purported to be granted hereby
and (b) at Secured Party's request, appear in and defend any action or
proceeding that may affect Pledgor's title to or Secured Party's security
interest in all or any part of the Collateral.
SECTION 8. Transfers and other Liens. Pledgor agrees that it will
not (a) sell, assign (by operation of law or otherwise) or otherwise dispose of
any of the Collateral or (b) create or suffer to exist any Lien upon or with
respect to any of the Collateral, except for the security interest under this
Agreement.
SECTION 9. Secured Party Appointed Attorney-in-Fact. Pledgor
hereby irrevocably appoints Secured Party as Pledgor's attorney-in-fact, with
full authority in the place and stead of Pledgor and in the name of Pledgor,
Secured Party or otherwise, from time to time in Secured Party's discretion to
take any action and to execute any instrument that Secured Party may deem
necessary or advisable to accomplish the purposes of this Agreement, including
without limitation to file one or more financing or continuation statements, or
amendments thereto, relative to all or any part of the Collateral without the
signature of Pledgor.
SECTION 10. Secured Party May Perform. If Pledgor fails to perform
any agreement contained herein, Secured Party may itself perform, or cause
performance of, such agreement, and the expenses of Secured Party incurred in
connection therewith shall be payable by Pledgor under Section 13.
SECTION 11. Standard of Care. The powers conferred on Secured Party
hereunder are solely to protect its interest in the Collateral and shall not
impose any duty upon it to exercise any such powers. Except for the exercise of
reasonable care in the custody
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of any Collateral in its possession and the accounting for moneys actually
received by it hereunder, Secured Party shall have no duty as to any Collateral,
it being understood that Secured Party shall have no responsibility for (a)
taking any necessary steps (other than steps taken in accordance with the
standard of care set forth above to maintain possession of the Collateral) to
preserve rights against any parties with respect to any Collateral or (b) taking
any necessary steps to collect or realize upon the Secured Obligations or any
guarantee therefor, or any part thereof, or any of the Collateral. Secured Party
shall be deemed to have exercised reasonable care in the custody and
preservation of Collateral in its possession if such Collateral is accorded
treatment substantially equal to that which Secured Party accords its own
property of like kind.
SECTION 12. Remedies.
(a) If any Event of Default or Potential Event of Default shall
have occurred and be continuing, Secured Party may (i) transfer any or all of
the Collateral to an account established in Secured Party's name (whether at
Secured Party or otherwise) or (ii) otherwise register title to any Collateral
in the name of Secured Party or one of its nominees or agents, without reference
to any interest of Pledgor.
(b) If any Event of Default shall have occurred and be continuing,
Secured Party may exercise in respect of the Collateral, in addition to all
other rights and remedies provided for herein or otherwise available to it, all
the rights and remedies of a secured party on default under the Uniform
Commercial Code as in effect in any relevant jurisdiction (the "Code") (whether
or not the Code applies to the affected Collateral).
(c) If the proceeds of any disposition of the Collateral are
insufficient to pay all the Secured Obligations, Pledgor shall be liable for the
deficiency and the fees of any attorneys employed by Secured Party to collect
such deficiency.
(d) Anything contained herein to the contrary notwithstanding, any
of the Collateral consisting of cash held by Secured Party in the Collateral
Account shall be subject to Secured Party's rights of set-off under subsection
10.4 of the Credit Agreement.
SECTION 13. Indemnity and Expenses.
(a) Pledgor agrees to indemnify Secured Party and each Lender from
and against any and all claims, losses and liabilities in any way relating to,
growing out of or resulting from this Agreement and the transactions
contemplated hereby (including, without limitation, enforcement of this
Agreement), except to the extent such claims, losses or liabilities result
solely from Secured Party's or such Lender's gross negligence or willful
misconduct as finally determined by a court of competent jurisdiction.
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(b) Pledgor shall pay to Secured Party upon demand the amount of
any and all costs and expenses, including the reasonable fees and expenses of
its counsel and of any experts and agents, that Secured Party may incur in
connection with (i) the administration of this Agreement, (ii) the custody,
preservation, use or operation of, or the sale of, collection from, or other
realization upon, any of the Collateral, (iii) the exercise or enforcement of
any of the rights of Secured Party hereunder, or (iv) the failure by Pledgor to
perform or observe any of the provisions hereof.
SECTION 14. Continuing Security Interest; Transfer of Loans. This
Agreement shall create a continuing security interest in the Collateral and
shall (a) remain in full force and effect until the indefeasible payment in full
of the Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all outstanding Letters of Credit, (b) be
binding upon Pledgor, its successors and assigns, and (c) inure, together with
the rights and remedies of Secured Party hereunder, to the benefit of Secured
Party and its successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), but subject to the provisions of
subsection 10.1 of the Credit Agreement, any Lender may assign or otherwise
transfer any Loans held by it to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted to
Lenders herein or otherwise. Upon the indefeasible payment in full of all
Secured Obligations, the cancellation or termination of the Commitments and the
cancellation or expiration of all outstanding Letters of Credit, the security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to Pledgor. Upon any such termination Secured Party shall, at Pledgor's
expense, execute and deliver to Pledgor such documents as Pledgor shall
reasonably request to evidence such termination and Pledgor shall be entitled to
the return, upon its request and at its expense, against receipt and without
recourse to Secured Party, of such of the Collateral as shall not have been
otherwise applied pursuant to the terms hereof.
SECTION 15. Secured Party as Administrative Agent.
(a) Secured Party has been appointed to act as Secured Party
hereunder by Lenders. Secured Party shall be obligated, and shall have the right
hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including,
without limitation, the release or substitution of Collateral), solely in
accordance with this Agreement and the Credit Agreement.
(b) Secured Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of resignation
by Administrative Agent pursuant to subsection 9.5 of the Credit Agreement shall
also constitute notice of resignation as Secured Party under this Agreement;
removal of Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute removal as Secured Party under this Agreement;
and appointment of a successor Administrative Agent pursuant to subsection 9.5
of the Credit Agreement shall also constitute appointment of a
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successor Secured Party under this Agreement. Upon the acceptance of any
appointment as Administrative Agent under subsection 9.5 of the Credit Agreement
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Secured Party under this Agreement, and
the retiring or removed Secured Party under this Agreement shall promptly (i)
transfer to such successor Secured Party all sums held by Secured Party
hereunder (which shall be deposited in a new Collateral Account established and
maintained by such successor Secured Party), together with all records and other
documents necessary or appropriate in connection with the performance of the
duties of the successor Secured Party under this Agreement, and (ii) execute and
deliver to such successor Secured Party such amendments to financing statements,
and take such other actions, as may be necessary or appropriate in connection
with the assignment to such successor Secured Party of the security interests
created hereunder, whereupon such retiring or removed Secured Party shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Administrative Agent's resignation or removal hereunder as
Secured Party, the provisions of this Agreement shall inure to its benefit as to
any actions taken or omitted to be taken by it under this Agreement while it was
Secured Party hereunder.
SECTION 16. Amendments; Etc. No amendment or waiver of any
provision of this Agreement, or consent to any departure by Pledgor herefrom,
shall in any event be effective unless the same shall be in writing and signed
by Secured Party, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it was given.
SECTION 17. Notices. Any notice or other communication herein
required or permitted to be given shall be in writing and may be personally
served, telexed or sent by telefacsimile or United States mail or courier
service and shall be deemed to have been given when delivered in person or by
courier service, upon receipt of telefacsimile or telex, or five Business Days
after depositing it in the United States mail with postage prepaid and properly
addressed. For the purposes hereof, the address of each party hereto shall be as
set forth under such party's name on the signature pages hereof or, as to either
party, such other address as shall be designated by such party in a written
notice delivered to the other party hereto.
SECTION 18. Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Secured Party in the exercise of any power,
right or privilege hereunder shall impair such power, right or privilege or be
construed to be a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude any
other or further exercise thereof or of any other power, right or privilege. All
rights and remedies existing under this Agreement are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
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SECTION 19. Severability. In case any provision in or obligation
under this Agreement shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
SECTION 20. Headings. Section and subsection headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose or be given any
substantive effect.
SECTION 21. Governing Law; Terms. THIS AGREEMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEVADA, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES, EXCEPT TO THE EXTENT THAT THE CODE PROVIDES THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE
OF NEVADA. Unless otherwise defined herein or in the Credit Agreement, terms
used in Articles 8 and 9 of the Uniform Commercial Code in the State of Nevada
are used herein as therein defined.
SECTION 22. Consent to Jurisdiction and Service of Process. ALL
JUDICIAL PROCEEDINGS BROUGHT AGAINST PLEDGOR ARISING OUT OF OR RELATING TO THIS
AGREEMENT MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION
IN THE STATE OF NEVADA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT PLEDGOR
ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND
UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS AND IRREVOCABLY AGREES TO BE BOUND BY
ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS
AGREEMENT. Pledgor hereby agrees that service of all process in any such
proceeding in any such court may be made by registered or certified mail, return
receipt requested, to Pledgor at its address provided in Section 17, such
service being hereby acknowledged by Pledgor to be sufficient for personal
jurisdiction in any action against Pledgor in any such court and to be otherwise
effective and binding service in every respect. Nothing herein shall affect the
right to serve process in any other manner permitted by law or shall limit the
right of Secured Party to bring proceedings against Pledgor in the courts of any
other jurisdiction.
SECTION 23. Waiver of Jury Trial. PLEDGOR AND SECURED PARTY HEREBY
AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. The scope of this waiver is
intended to be all-encompassing of
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any and all disputes that may be filed in any court and that relate to the
subject matter of this transaction, including without limitation contract
claims, tort claims, breach of duty claims, and all other common law and
statutory claims. Pledgor and Secured Party each acknowledge that this waiver is
a material inducement for Pledgor and Secured Party to enter into a business
relationship, that Pledgor and Secured Party have already relied on this waiver
in entering into this Agreement and that each will continue to rely on this
waiver in their related future dealings. Pledgor and Secured Party further
warrant and represent that each has reviewed this waiver with its legal counsel,
and that each knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
In the event of litigation, this Agreement may be filed as a written consent to
a trial by the court.
SECTION 24. Counterparts. This Agreement may be executed in one or
more counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but all
such counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document.
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IN WITNESS WHEREOF, Pledgor and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
PLAYERS INTERNATIONAL, INC., as Pledgor
By: __________________________________
Title:
Notice Address:
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
Attention: President and
Chief Financial Officer
With copies to:
Players International, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
Attention: Chief Financial Officer
and
Players International, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
Attention: General Counsel
FIRST INTERSTATE BANK OF NEVADA, N.A., as
Secured Party
By: __________________________________
Title:
Notice Address:
0000 Xxxxxx Xxxxxx Xxxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
S-1
Attention: Xxxxx Xxxxx
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