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TRANS WORLD GAMING CORP.
TRANS WORLD GAMING OF LOUISIANA, INC.
Issuer
and
U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee
FIRST AMENDED
INDENTURE
Dated as of March 31, 1998
--------------------
$4,800,000
12% Secured Senior Bonds Due 2005
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TABLE OF CONTENTS
PAGE
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
FORM OF FACE OF SECURITY . . . . . . . . . . . . . . . . . . . . . . . .
FORM OF REVERSE OF SECURITY. . . . . . . . . . . . . . . . . . . . . . .
ARTICLE 1 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 1.1 Certain Terms Defined. . . . . . . . . . . . . . . . . 8
ARTICLE 2 ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES. . . . 13
SECTION 2.1 Authentication and Delivery of Securities. . . . . . . 13
SECTION 2.2 Execution of Securities. . . . . . . . . . . . . . . . 13
SECTION 2.3 Certificate of Authentication. . . . . . . . . . . . . 14
SECTION 2.4 Form, Denomination and Date of Securities;
Payments of Interest in Cash and in
Additional Securities . . . . . . . . . . . . . . . . 14
SECTION 2.5 Registration, Transfer and Exchange. . . . . . . . . . 15
SECTION 2.6 Mutilated, Defaced, Destroyed, Lost and Stolen
Securities . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.7 Cancellation of Securities; Destruction Thereof. . . . 17
SECTION 2.8 Temporary Securities . . . . . . . . . . . . . . . . . 17
ARTICLE 3 COVENANTS OF THE ISSUER. . . . . . . . . . . . . . . . . . . 17
SECTION 3.1 Payment of Principal and Interest. . . . . . . . . . . 17
SECTION 3.2 Offices for Payments, Etc. . . . . . . . . . . . . . . 18
SECTION 3.3 Appointment To Fill a Vacancy in Office of Trustee . . 18
SECTION 3.4 Paying Agents. . . . . . . . . . . . . . . . . . . . . 18
SECTION 3.5 Officers' Certificates as to Default and as to
Compliance . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.6 Maintenance of Properties, Etc.. . . . . . . . . . . . 19
SECTION 3.7 Excess Cash Flow Payment. . . . . . . . . . . . . . .
SECTION 3.8 Books. . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.9 Guarantees . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.10 Senior Indebtedness . . . . . . . . . . . . . . . . .
SECTION 3.11 Distributions . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.12 Disposition of Assets . . . . . . . . . . . . . . . . 20
SECTION 3.13 Line of Business. . . . . . . . . . . . . . . . . . .
SECTION 3.14 Payments for Consent. . . . . . . . . . . . . . . . .
SECTION 3.15 Cost of Operations. . . . . . . . . . . . . . . . . .
SECTION 3.16 Reserved. . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.17 Waiver of Stay, Extension or Usury Laws . . . . . . . 21
SECTION 3.18 Bishkek Note. . . . . . . . . . . . . . . . . . . . .
SECTION 3.19 Security Interest . . . . . . . . . . . . . . . . . .
-i-
ARTICLE 4 SECURITYHOLDERS' LISTS AND REPORTS BY THE ISSUER AND
THE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.1 Issuer To Furnish Trustee Information as to Names
and Addresses of Securityholders . . . . . . . . . . . 22
SECTION 4.2 Preservation and Disclosure of Securityholders'
Lists. . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.3 Reports by the Issuer. . . . . . . . . . . . . . . . . 23
SECTION 4.4 Listing. . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE 5 REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT
OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 5.1 Event of Default Defined; Acceleration of Maturity;
Waiver of Default. . . . . . . . . . . . . . . . . . . 24
SECTION 5.2 Collection of Indebtedness by Trustee; Trustee
May Prove Indebtedness . . . . . . . . . . . . . . . . 27
SECTION 5.3 Application of Proceeds. . . . . . . . . . . . . . . . 29
SECTION 5.4 Suits for Enforcement. . . . . . . . . . . . . . . . . 29
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings. . 30
SECTION 5.6 Limitations on Suits by Securityholders. . . . . . . . 30
SECTION 5.7 Unconditional Right of Securityholders To Institute
Certain Suits. . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.8 Powers and Remedies Cumulative; Delay or Omission
Not Waiver of Default. . . . . . . . . . . . . . . . . 31
SECTION 5.9 Control by Securityholders . . . . . . . . . . . . . . 31
SECTION 5.10 Waiver of Past Defaults . . . . . . . . . . . . . . . 31
SECTION 5.11 Trustee to Give Notice of Default, But May
Withhold in Certain Circumstances . . . . . . . . . . 32
SECTION 5.12 Right of Court To Require Filing of Undertaking
To Pay Costs. . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.13 Excess Cash Flow. . . . . . . . . . . . . . . . . . .
ARTICLE 6 CONCERNING THE TRUSTEE . . . . . . . . . . . . . . . . . . . 33
SECTION 6.1 Duties and Responsibilities of the Trustee; During
Default; Prior to Default. . . . . . . . . . . . . . . 33
SECTION 6.2 Certain Rights of the Trustee. . . . . . . . . . . . . 34
SECTION 6.3 Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof. . . . . 35
SECTION 6.4 Trustee and Agents May Hold Securities;
Collections, Etc.. . . . . . . . . . . . . . . . . . . 35
SECTION 6.5 Moneys Held by Trustee . . . . . . . . . . . . . . . . 36
SECTION 6.6 Compensation and Indemnification of Trustee and Its
Prior Claim. . . . . . . . . . . . . . . . . . . . . . 36
SECTION 6.7 Right of Trustee to Rely on Officers'
Certificate, Etc . . . . . . . . . . . . . . . . . . . 36
SECTION 6.8 [Reserved] . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.9 Persons Eligible for Appointment as Trustee. . . . . . 37
-ii-
SECTION 6.10 Resignation and Removal; Appointment of Successor
Trustee . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.11 Acceptance of Appointment by Successor Trustee. . . . 38
SECTION 6.12 Merger, Conversion, Consolidation or Succession to
Business of Trustee . . . . . . . . . . . . . . . . . 39
SECTION 6.13 [Reserved]. . . . . . . . . . . . . . . . . . . . . . 39
SECTION 6.14 Trust Estate May be Vested in Co-Trustee or in a
Sub-Trust . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 7 CONCERNING THE SECURITYHOLDERS . . . . . . . . . . . . . . . 42
SECTION 7.1 Evidence of Action Taken by Securityholders. . . . . . 42
SECTION 7.2 Proof of Execution of Instruments and of Holding of
Securities.. . . . . . . . . . . . . . . . . . . . . . 42
SECTION 7.3 Holders To Be Treated as Owners. . . . . . . . . . . . 42
SECTION 7.4 Securities Owned by Issuer Deemed Not Outstanding. . . 42
SECTION 7.5 Right of Revocation of Action Taken. . . . . . . . . . 43
ARTICLE 8 SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . . . . . . 43
SECTION 8.1 Supplemental Indentures Without Consent of
Securityholders. . . . . . . . . . . . . . . . . . . . 43
SECTION 8.2 Supplemental Indentures with Consent of
Securityholders. . . . . . . . . . . . . . . . . . . . 44
SECTION 8.3 Effect of Supplemental Indenture . . . . . . . . . . . 45
SECTION 8.4 Documents To Be Given to Trustee . . . . . . . . . . . 46
SECTION 8.5 Notation on Securities in Respect of Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE 9 NO CONSOLIDATION, MERGER, SALE OR CONVEYANCE . . . . . . . . 46
ARTICLE 10 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS. . 46
SECTION 10.1 Satisfaction and Discharge of Indenture . . . . . . . 46
SECTION 10.2 Defeasance and Discharge of Indenture . . . . . . . . 47
SECTION 10.3 Defeasance of Certain Obligations . . . . . . . . . . 48
SECTION 10.4 Application by Trustee of Funds Deposited for
Payment of Securities . . . . . . . . . . . . . . . . 49
SECTION 10.5 Repayment of Moneys Held by Paying Agent. . . . . . . 50
SECTION 10.6 Return of Moneys Held by Trustee and Paying Agent
Unclaimed for One Year. . . . . . . . . . . . . . . . 50
SECTION 10.7 Reinstatement . . . . . . . . . . . . . . . . . . . . 50
ARTICLE 11 MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . 51
SECTION 11.1 Incorporators, Shareholders, Officers and Directors
of Issuer Exempt from Individual Liability. . . . . . 51
SECTION 11.2 Provisions of Indenture for the Sole Benefit of Parties
-iii-
and Securityholders . . . . . . . . . . . . . 51
SECTION 11.3 Successors and Assigns of Issuer Bound by
Indenture . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 11.4 Notices and Demands on Issuer, Trustee and
Securityholders . . . . . . . . . . . . . . . . . . . 51
SECTION 11.5 Compliance Certificates and Opinions of Counsel;
Statements To Be Contained Therein. . . . . . . . . . 52
SECTION 11.6 Payments Due on Saturdays, Sundays and Holiday. . . . 53
SECTION 11.7 Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939 . . . . . . . . . . . . . . . . 53
SECTION 11.8 New York Law To Govern. . . . . . . . . . . . . . . . 54
SECTION 11.9 Counterparts. . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.10 Effect of Headings . . . . . . . . . . . . . . . . . 54
SECTION 11.11 Board of Directors . . . . . . . . . . . . . . . . .
SECTION 11.12 Waiver of Usury Laws . . . . . . . . . . . . . . . .
ARTICLE 12 REDEMPTION OF SECURITIES . . . . . . . . . . . . . . . . . . 55
SECTION 12.1 Right of Optional Redemption; Prices. . . . . . . . . 55
SECTION 12.2 Notice of Redemption. . . . . . . . . . . . . . . . . 55
SECTION 12.3 Payment of Securities Called for Redemption . . . . . 56
SECTION 12.4 Exclusion of Certain Securities from Eligibility
for Selection for Redemption. . . . . . . . . . . . . 56
SECTION 12.5 Selection of Securities to be Redeemed. . . . . . . .
SECTION 12.6 Partial Redemption of Securities. . . . . . . . . . .
ARTICLE 13 WARRANT
ARTICLE 14 SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 14.1 Pledge and Security Interest. . . . . . . . . . . . . 64
SECTION 14.2 Security for Obligation . . . . . . . . . . . . . . . 64
SECTION 14.3 Perfection of Security Interest . . . . . . . . . . . 64
SECTION 14.4 No Disposition of Collateral; Release of Lien of
Indenture . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 14.5 Other Liens . . . . . . . . . . . . . . . . . . . . . 65
SECTION 14.6 Trustee Appointed Attorney-in-Fact. . . . . . . . . . 65
SECTION 14.7 Return of Collateral. . . . . . . . . . . . . . . . . 65
SECTION 14.8 Default Remedies. . . . . . . . . . . . . . . . . . . 65
SECTION 14.9 Proceeds. . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 14.10 Deficiency . . . . . . . . . . . . . . . . . . . . . 66
SECTION 14.11 Trustee's Duties . . . . . . . . . . . . . . . . . . 66
SECTION 14.12 Special Trustee Powers Due to Environmental
Conditions . . . . . . . . . . . . . . . . . . . . . 66
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
-iv-
THIS FIRST AMENDED INDENTURE, dated as of March 31, 1998 between Trans
World Gaming Corp, a Nevada corporation ("TWG"), and its wholly-owned
subsidiary, Trans World Gaming of Louisiana, Inc., a Louisiana corporation (TWG
Louisiana, which together with TWG shall be collectively, the "Issuer"), and
U.S. Trust Company of Texas, N.A., a national banking association, not in its
individual capacity but solely as trustee (the "Trustee"),
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the issue of its 12% Secured
Senior Bonds Due 2005 (the "Securities"); and
WHEREAS, the Issuer authorized and issued its $4,800,000 12% Secured
Convertible Senior Bonds Due 1999 dated as of November 1, 1996 ("Original
Securities"), pursuant to an Indenture dated as of November 1, 1996 ("Original
Indenture"); and
WHEREAS, one hundred percent (100%) of the holders of the issued and
Outstanding Original Securities have agreed to the modification of the Original
Securities and Original Indenture on the terms and conditions set forth herein;
and
WHEREAS, the Securities and the Trustee's certificate of authentication
shall be in substantially the following form:
[FORM OF FACE OF SECURITY]
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES ACT, AND MAY NOT BE TRANSFERRED WITHOUT
REGISTRATION UNDER SUCH ACTS OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER
THAT SUCH REGISTRATION IS NOT REQUIRED.
No. $
TRANS WORLD GAMING CORP.
TRANS WORLD GAMING OF LOUISIANA, INC.
12% Secured Senior Bond Due 2005
Date: March 31, 1998
Trans World Gaming Corp., a Nevada corporation ("TWG"), and its wholly-owned
subsidiary, Trans World Gaming of Louisiana, Inc., a Louisiana corporation (TWG
Louisiana, which together with TWG shall be collectively, the "Issuer"), for
value received hereby promise to pay jointly and severally to ,
or registered assigns, the principal sum of _________ Dollars, with interest
thereon as set forth herein. Interest on the unpaid principal shall accrue the
rate of 12% per annum. Interest shall accrue on this Security from June 30,
1996, the date of the
Page 1
Original Security for which this Security is being substituted and the date from
which interest began accruing on the Original Security. The unpaid principal
and accrued unpaid interest shall mature and be due and payable on the Maturity
Date or such earlier date as provided herein. All payments of principal and
interest shall be in such coin or currency of the United States of America as
at the time of payment shall be legal tender for the payment of public and
private debts. Should an Event of Default occur, the unpaid principal (and
unpaid interest, to the extent permitted by applicable law) shall bear interest
at the Default Rate. The Default Rate is 17% per annum compounded semiannually,
subject to the Maximum Rate (as defined in the Indenture) and other limitations
thereon as set forth in this Indenture.
The sum of Excess Cash Flow allocable to this Security shall, except as
otherwise provided in the Indenture referred to on the Reverse hereof, be paid
to the Person in whose name this Security is registered on the Record Date next
preceding such Cash Flow Payment Date, whether or not such is a Business Day;
In the event a Default occurs as to the payment of Excess Cash Flow,
interest shall accrue at the Default Rate from the preceding Record Date for
which there was no such Default.
Interest on this Security will be calculated on the basis of a 360-day
year, consisting of twelve 30-day months.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof which further provisions shall for all purposes have
the same effect as if set forth in this place.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed under its corporate seal.
[Seal] TRANS WORLD GAMING CORP.
By: _____________________________________
By: ___________________________________
[Seal] TRANS WORLD GAMING OF LOUISIANA, INC.
By: _____________________________________
By: ___________________________________
Page 2
[FORM OF REVERSE OF SECURITY]
TRANS WORLD GAMING CORP.
TRANS WORLD GAMING OF LOUISIANA, INC.
12% Secured Senior Bond Due 2005
This Security is one of a duly authorized issue of debt of the Issuer,
with an aggregate principal amount of $4,800,000, issued pursuant to The First
Amended Indenture dated as of March 31, 1998, (the "Indenture"), duly executed
and delivered by the Issuer to U.S. Trust Company of Texas, N.A., as Trustee
(herein called the "Trustee"). Reference is hereby made to the Indenture and all
indentures supplemental thereto for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the Issuer
and the Holders (the words "Holders" or "Holder" meaning the registered holders
or registered holder) of the Securities. The Securities are secured obligations
of the Issuer. Capitalized terms used in this Security and not defined herein
shall have the meaning set forth in the Indenture.
In case an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the debt in respect of all of the Securities then
Outstanding may be declared due and payable in the manner and with the effect,
and subject to the conditions, provided in the Indenture. The Indenture
provides that the Holders of a majority in aggregate principal amount of the
Securities then Outstanding, by notice to the Trustee, may on behalf of the
Holders of all of the Securities, waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event of
Default in the payment of interest on, or the principal of, the Securities on
the Maturity Date or in respect of a covenant or provision that cannot be
modified or amended without the consent of all Holders of the Securities. Any
such consent or waiver by the Holder of this Security (unless revoked as
provided in the Indenture) shall be conclusive and binding upon such Holder and
upon all future Holders and owners of this Security and any Security which may
be issued in exchange or substitution therefore, whether or not any notation
thereof is made upon this Security or such other Securities.
The Indenture permits the Issuer and the Trustee, with the consent of (i)
the Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding, and (ii) the holders of 50% in aggregate
principal amount of the 12% Senior Secured Notes due March 2005 of TWG, TWG
International U.S. Corporation, a Nevada corporation ("TWG Finance") (the "Czech
Notes"), issued pursuant to the terms of an Indenture dated March 31, 1998,
among TWG, TWG International and TWG Finance and the Trustee, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental
indenture or modifying in any manner the rights of the Holders of the
Securities; PROVIDED that no such supplemental indenture shall, without the
consent of each Holder affected thereby (and the holders of 75% in aggregate
principal amount of the Czech Notes with respect to subsections (i) - (iii) and
subsection (viii) as it relates to subsections (i) - (iii)) (with respect to any
Securities held by a non-consenting Securityholder): (i) reduce the principal
amount of Securities whose Holders must consent to an amendment, supplement or
waiver, (ii) reduce the principal of or change the fixed maturity of any
Security or alter the provisions with respect to the redemption of the
Securities, (iii) reduce
Page 3
the rate of or change the time for payment of interest on any Security, (iv)
waive a Default or Event of Default in the payment of principal of or premium,
if any, or interest on the Securities (except a rescission of acceleration of
the Securities by the Holders of at least a majority in aggregate principal
amount of the then Outstanding Securities and a waiver of the payment default
that resulted from such acceleration), (v) make any Security payable in money
other than that stated in the Securities, (vi) make any change in the provisions
of the Indenture relating to waivers of past Defaults or the rights of Holders
of Securities to receive payments of principal of or interest on the Securities,
(vii) waive a redemption payment with respect to any Security, or (viii) make
any change in the foregoing amendment and waiver provisions.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligations of the Issuer, which are
absolute and unconditional, to pay the principal of and the interest on this
Security at the place, times, and rate, and in the currency, herein prescribed.
The Securities are issuable only as registered Securities without
coupons.
At the office or agency of the Issuer referred to on the face hereof and
in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at the
above-mentioned office or agency of the Issuer, a new Security or Securities of
authorized denominations, for a like aggregate principal amount, will be issued
to the transferee as provided in the Indenture. No service charge shall be made
for any such transfer, but the Issuer may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto.
As provided in, and subject to the terms and conditions of, the
Indenture, the Issuer shall be required to make mandatory prepayments of
principal and interest equal to Excess Cash Flow until the Obligations (as
defined in the Indenture) are fully defeased pursuant to Section 10.2 or until
one hundred percent (100%) of the principal amount of the Securities, together
with accrued and unpaid interest, is paid. The Securities may also be redeemed
by the Issuer at any time or from time to time, in whole, or in part, upon
mailing a notice of such redemption not less than 30 nor more than 60 days prior
to the date fixed for redemption to the Holders of Securities to be redeemed, at
a redemption price equal to 100% of the principal amount of the Securities
redeemed, together with accrued and unpaid interest to the date fixed for
redemption.
Subject to payment by the Issuer of a sum sufficient to pay the
obligations upon redemption, interest on this Security shall cease to accrue
upon the date duly fixed for redemption of this Security.
The Securities shall not be secured by, and the Holders of the Securities
shall have no rights relating to, the Capital Stock or assets of (including
direct and indirect, partially or wholly owned Subsidiaries) of either TWG
International or TWG Finance, until the Czech Notes are fully defeased, fully
redeemed or paid in full.
Page 4
The Issuer, the Trustee and any authorized agent of the Issuer or the
Trustee may deem and treat the registered Holder hereof as the absolute owner of
this Security (whether or not this Security shall be overdue and notwithstanding
any notation of ownership or other writing hereon made by anyone other than the
Issuer or the Trustee or any authorized agent of the Issuer or the Trustee), for
the purpose of receiving payment of, or on account of, the principal hereof and
premium, if any, and subject to the provisions on the face hereof, interest
hereon and for all other purposes, and neither the Issuer nor the Trustee nor
any authorized agent of the Issuer or the Trustee shall be affected by any
notice to the contrary.
No recourse shall be had for the payment of the principal of, premium, if
any, or the interest on this Security, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer, employee
or director, as such, past, present or future, of the Issuer or Trustee
or of any successor corporation, either directly or through the Issuer or any
successor corporation, whether by virtue of any constitution, statute or rule of
law or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
This Security shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly signed by an authorized signatory of
the Trustee acting under the Indenture.
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-mentioned
Indenture.
Dated:
U.S. Trust Company of Texas, N.A. , as
Trustee
By: ____________________________________
Authorized Signatory
Page 5
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to:
______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint _________________________________________ agent to
transfer this Security on the books of Issuer. The agent may substitute another
to act for him.
______________________________________________________________________________
______________________________________________________________________________
(Print or type other person's name, address and zip code)
Date: _________________________ ____________________________________
Your Signature
____________________________________
Signature Guaranty
____________________________________
Notice: Signature must be guaranteed
by an "Eligible Guarantor Institution"
as defined by Securities Exchange Act
Rule 17Ad-15.
(Sign exactly as your name appears on the other side of this Security)
Page 6
NOW, THEREFORE:
In consideration of the premises and the purchases of the Securities by
the Holders thereof, the Issuer and the Trustee mutually covenant and agree for
the equal and proportionate benefit of the respective Holders from time to time
of the Securities as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 CERTAIN TERMS DEFINED. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section 1.1. The words
"HEREIN," "HEREOF" and "HEREUNDER" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other
subdivision. The terms defined in this Article include the plural as well as
the singular.
"ACCELERATION DATE" has the meaning specified in Section 5.1.
"ACCELERATION NOTICE" has the meaning specified in Section 5.1.
"ASSET SALE" means the sale, lease, conveyance, disposition or other
transfer (including, without limitation, by eminent domain, condemnation or
similar governmental proceeding) of any property or assets of the Issuer or any
of its direct or indirect Subsidiaries, (other than TWG International or TWG
Finance, or any of their respective Subsidiaries until the Czech Notes are paid
in full) (including a sale and leaseback transaction or the issuance, sale or
transfer of Capital Stock of a direct or indirect Subsidiary (except TWG
International or TWG Finance or any of their respective Subsidiaries until the
Czech Notes are paid in full) except an acquisition of such Capital Stock by TWG
or its direct or indirect Subsidiaries).
"BISHKEK NOTE" means the obligation of TWG to Value Partners, Ltd. or its
assignee evidencing the obligation to repay sums used to acquire, commence
and/or fund operations in the city of Bishkek, in the Republic of Kryrgyz,
including those related to table and slot machine operations (the "Bishkek
Facility")and such documents necessary to grant Value Partners, Ltd. a security
interest in such assets.
"BOARD OF DIRECTORS" means the Board of Directors of the Issuer or any
committee of such Board duly authorized to act hereunder.
"BUSINESS DAY" means a day which in the city (or in any of the cities, if
more than one) where amounts are payable in respect of the Securities, as
specified on the face of the form of Security recited above, or in the city in
which the Corporate Trust Office or the operations office of the Trustee for
payment and transfer of the Securities are located, is neither a legal holiday
nor a day on which banking institutions are required or authorized by law or
regulation to close.
Page 7
"CAPITAL STOCK" means any and all shares, interests, participations,
rights or other equivalents (however designated) or corporate stock, whether
common or preferred, including, without limitation, partnership interests.
"CASH FLOW PAYMENT DATE" mean(s) the date(s) Excess Cash Flow is paid
pursuant to Section 3.7.
"CZECH NOTES" means Trans World Gaming Corp., TWG International U.S.
Corporation, and TWG Finance Corp. (as co-obligors) 12% Senior Secured Notes
dated March 31, 1998 in the sum of $17,000,000 Due March 17, 2005.
"CZECH INDENTURE" means that certain Indenture dated as of March 31, 1998
entered into by TWG, TWG International and TWG Finance as co-obligors, in
relation to the Czech Notes.
"COLLATERAL AGREEMENTS" means any agreements executed by the Issuer which
are intended to create a Lien on any Collateral, including without limitation,
appropriate security agreements, multiple indebtedness mortgages and financing
statements.
"COMMISSION" means the Securities and Exchange Commission.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is dated, located at 0000 Xxxx Xxxxxx, Xxxxxx, XX 00000-0000,
Attention: Corporate Trust Department.
"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.
"DEFAULT RATE" with respect to the Securities means 17% per annum
compounded semiannually, subject to the Maximum Rate and other limitations
thereon as set forth in this Indenture.
"EVENT OF DEFAULT" means any event or condition specified as such in
Section 5.1 which shall have continued for the period of time, if any, therein
designated.
"EXCESS CASH FLOW" means, for any period through December 31, 2005, or in
the event the Obligations are not satisfied in full by the Maturity Date, such
later date on which the Obligations are satisfied in full:
(a) until the Czech Notes are paid in full, Issuer's net income solely
from its U.S. operations and from the Bishkek Facility (as determined by GAAP)
adjusted as follows (in each case without duplication): minus (i) all cash flow
from the operation of Bishkek until the Bishkek Note is paid in full, plus (ii)
all cash flow from the operation of Bishkek after the Bishkek Note is paid in
full; plus (iii) non-cash items relating to the Issuer's U.S. operation and from
the Bishkek Facility which decrease net income, including, without limitation
depreciation expense and
Page 8
amortization expense (including amortization of deferred financing costs and
original issue discounts), but only to the extent included in computing such net
income, plus (iv) Undistributed Excess Cash Flow, MINUS (iv) the amount
necessary to establish or maintain a working capital reserve of $250,000 at all
times, PLUS (v) Net Cash Proceeds; MINUS, the cost of administration incurred by
the Issuer pursuant to Section 3.16 and not reimbursed by TWG International or
TWG Finance, MINUS (vi) a one-time reserve of sums disbursed to TWG from the
proceeds of the sales of the Czech Notes to pay post-closing costs of the Issuer
associated with the Czech Notes transaction and related events and to pay the
cost of public registration of Common Stock of TWG, and MINUS (vii) such sums
that TWG determines are reasonably necessary to meet its operating needs in
excess of its working capital reserves.
(b) subsequent to the date the Czech Notes are paid in full; (i) Issuer's net
income from its U.S. and non-U.S. operations, including the Bishkek Facility and
the Czech Casinos (as determined by GAAP) adjusted as follows (in each case
without duplication): minus (i) all cash flow from the operations of Bishkek
Facility until the Bishkek Note is paid in full, plus (ii) all cash flow from
the operation of Bishkek Facility after the Bishkek Note is paid in full; plus
(iii) non-cash items which decrease net income, including, without limitation,
depreciation expense and amortization expense (including amortization of
deferred financing costs and original issue discounts), but only to the extent
included in computing such net income; plus (iv) Undistributed Excess Cash Flow;
MINUS (v) the amount necessary to establish or maintain a working capital
reserve of $250,000 at all times, PLUS (vi) Net Cash Proceeds; and MINUS (vii)
the cost of administration of TWG; MINUS (viii) a one-time reserve of sums
disbursed to TWG from the proceeds of the sale of the Czech Notes to pay
post-closing costs of the Issuer associated with the Czech Notes transactions
and related events and to pay the cost of public registration of Common Stock of
TWG, and MINUS (ix) such sums that TWG determines are reasonably necessary to
meet its operating needs in excess of its working capital reserves.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FUNDING COLLATERAL AGREEMENTS" has the meaning that the term "Collateral
Agreements" has in the Indenture issued pursuant to the Funding Note.
"FUNDING NOTE" means TWG International 12% Senior Secured Notes in the
sum of $17,000,000 Due March 2005.
"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 may be approved by a significant segment of the accounting
profession, as the same are in effect on the Issue Date.
"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, and "Guaranteed" has a correlative meaning.
Page 9
"HOLDER," "SECURITYHOLDER" or any other similar term means the registered
holder of any Security.
"INCUR" means to, directly or indirectly, create, incur, issue, assume,
guaranty or otherwise become liable with respect to.
"INDEBTEDNESS" means, with respect to any Person, without duplication,
any indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
representing the balance deferred and unpaid of the purchase price of any
property (including pursuant to capital leases), except any such balance that
constitutes an accrued expense or trade payable, if and to the extent any of the
foregoing would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP, and also includes, to the extent not otherwise
included, the Guarantee of items that would be included within this definition
and all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on any asset or property (including, without limitation, leasehold
interests and any other tangible or intangible property) of such Person, whether
or not such Indebtedness is assumed by such Person or is not otherwise such
Person's legal liability, PROVIDED that if the obligations so secured have not
been assumed in full by such Person or are otherwise not such Person's legal
liability in full, the amount of such Indebtedness for the purposes of this
definition shall be limited to the lesser of the amount of such Indebtedness
secured by such Lien or the fair market value of the assets or property securing
such Lien. Notwithstanding the foregoing, the term "Indebtedness" shall not
include deferred compensation arrangements that are not evidenced by bonds,
notes, debentures or similar instruments.
"INDENTURE" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or
supplemented.
"ISSUE DATE" means the date on which the Securities are issued under this
amended Indenture.
"ISSUER" means Trans World Gaming Corp, a Nevada corporation, and its
wholly-owned subsidiary, Trans World Gaming of Louisiana, Inc., and, subject to
Article Nine, their successors and assigns, and any other obligor on the
Securities.
"KEY EMPLOYEE means persons such as production managers or sales
managers, who are not executive officers but who make or are expected to make
significant contributions to the business of the Issuer.
"LIEN" means, with respect to any asset, any mortgage; including without
limitation any multiple indebtedness 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
Page 10
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).
"MAXIMUM RATE" has the meaning contained in Section 3.1.
"MATURITY DATE" means the earlier of the date which is six (6) months
following the date the Czech Notes are fully defeased or paid in full or
December 31, 2005 or such earlier date as provided herein, by acceleration or
otherwise.
"NET CASH PROCEEDS" means the aggregate cash proceeds received by TWG or
any of its Subsidiaries (other than TWG International and TWG Finance, or any of
their Subsidiaries, prior to the payment in full of the Czech Notes) in respect
of any Asset Sale, net of the direct costs relating to such Asset Sale
(including, without limitation, title insurance fees and premiums, filing and
recordation fees, permit fees, landlord consent payments and other amounts
required to be paid to transfer the assets that are the subject of such Asset
Sale, sales commissions and legal, accounting and investment banking fees
incurred in respect of such Asset Sale) 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), and amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the asset or assets that are the subject of
such Asset Sale; PROVIDED FURTHER, HOWEVER, that if the agreement or instrument
governing such Asset Sale requires the transferor to maintain a portion of the
purchase price in escrow (whether as reserve for adjustment in respect of the
purchase price or otherwise) or to indemnify the transferee for specified
liabilities in a maximum stated amount for a stated period of time, the portion
of the cash consideration that is actually placed in escrow or segregated and
set aside by the transferor for such indemnification obligation shall not be
deemed to be Net Cash Proceeds until the escrow terminates or the transferor
ceases to segregate and set aside such funds, in whole or in part, and then only
to the extent of the proceeds released from escrow to the transferor or that are
no longer segregated and set aside by the transferor.
"OBLIGATIONS" has the meaning specified in Section 14.2.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of the
Board of Directors or the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") and by the Treasurer or the Secretary or any Assistant
Treasurer or Secretary of the Issuer and delivered to the Trustee. Each such
certificate shall include the statements provided for in Section 11.5.
"OPINION OF COUNSEL" means an opinion in writing signed by legal counsel
who may be an employee of or counsel to the Issuer or who may be other counsel
satisfactory to the Trustee. Each such opinion shall include the statements
provided for in Section 11.5, if and to the extent required hereby.
Page 11
"OUTSTANDING," when used with reference to Securities, means, subject to
the provisions of Sections 6.8 and 7.4, as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except:
(a) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption (i)
of which moneys in the necessary amount shall have been deposited in trust with
the Trustee or with any paying agent (other than the Issuer) or shall have been
set aside, segregated and held in trust by the Issuer (if the Issuer shall act
as paying agent) or (ii) of which moneys and/or Government Securities as
contemplated by Section 10.2 in the necessary amount have been theretofore
deposited with the Trustee (or another trustee satisfying the requirements of
Section 6.9) in trust for the Holders of such Securities in accordance with
Section 10.2 and the conditions set forth therein have been satisfied; PROVIDED
that if such Securities are to be redeemed prior to the maturity thereof, notice
of such redemption shall have been given as herein provided, or provision
satisfactory to the Trustee shall have been made for giving such notice; and
(c) Securities in substitution for which other Securities shall have
been authenticated and delivered, or which shall have been paid, pursuant to the
terms of Section 2.6 (unless proof satisfactory to the Trustee is presented that
any of such Securities is held by a Person in whose hands such Security is a
legal, valid and binding obligation of the Issuer).
"PAYMENT DEFAULT" has the meaning specified in Section 5.1.
"PERSON" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"PRINCIPAL" wherever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include the amount of the
Security plus, when appropriate, the premium, if any.
"PROPERTY" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included on the
most recent consolidated balance sheet of such Person in accordance with GAAP.
"RECORD DATE" has the meaning specified in Section 3.7.
"RELATED BUSINESS" has the meaning specified in the Czech Indenture.
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
officer in its Corporate Trust Office, or any other assistant officer of the
Trustee in its Corporate Trust Office customarily performing functions similar
to those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of his
Page 12
or her knowledge of and familiarity with the particular subject.
"SECURITY" or "SECURITIES" means any of the 12% Secured Senior Bonds Due
2005 authenticated and delivered under this Indenture.
"SUBSCRIPTION AGREEMENT" means the subscription agreement dated as of
July 1, 1996, by and among Trans World Gaming Corp., a Nevada corporation, Trans
World Gaming of Louisiana, Inc., a Louisiana corporation, and the
Securityholders.
"SUBSIDIARY" means 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 any Person or one or more of the other
Subsidiaries of that Person or a combination thereof.
"TWG" means Trans World Gaming Corp.
"TWG INTERNATIONAL" means TWG International U.S. Corporation, and its
direct and indirect Subsidiaries.
"TWG FINANCE" means TWG Finance Corp.
"TWG LOUISIANA" means Trans World Gaming of Louisiana, Inc.
"TRUSTEE" means the entity identified as "Trustee" in the first paragraph
hereof and, subject to the provisions of Article Six, shall also include any
successor trustee.
"UNDISTRIBUTED EXCESS CASH FLOW" means, for any period, that portion of
the aggregate Excess Cash Flow from all prior periods which has not been
previously used to repay accrued unpaid interest or unpaid principal due on the
Securities.
ARTICLE 2
ISSUE, EXECUTION, FORM AND
REGISTRATION OF SECURITIES
SECTION 2.1 AUTHENTICATION AND DELIVERY OF SECURITIES. Securities in
an aggregate principal amount not in excess of $4,800,000 (except as otherwise
provided in Section 2.6) may be executed by the Issuer and delivered to the
Trustee for authentication. After such execution a responsible officer of the
Trustee shall authenticate and deliver said Securities to the Holders, or as
directed by the Issuer upon the written order of the Issuer. Upon surrender of
the certificates representing the Original Securities by the Holders thereof,
the Trustee shall cancel such certificates, and the Issuer shall execute and the
Trustee shall authenticate new certificates in the form required hereby upon the
written instructions or order of the Issuer and
Page 13
the Holders. Notwithstanding whether a Holder surrenders its Original
Certificate, after the effective of date of this Indenture, the Original
Securities shall not be Outstanding hereunder, and the Holder thereof shall be
entitled only to receive a certificate(s) representing a Security as provided
herein upon surrender of the Original Security and provided herein.
SECTION 2.2 EXECUTION OF SECURITIES. The Securities shall be signed on
behalf of the Issuer by both (a) its Chairman of the Board of Directors or any
Vice Chairman of the Board of Directors or its President or any Vice President
(whether or not designated by a number or numbers or a word or words added
before or after the title "Vice President") and (b) by its Treasurer or any
Assistant Treasurer or its Secretary or any Assistant Secretary, under its
corporate seal which may, but need not, be attested. Such signatures may be the
manual or facsimile signatures of the present or any future such officers. The
seal of the Issuer may be in the form of a facsimile thereof and may be
impressed, affixed, imprinted or otherwise reproduced on the Securities.
Typographical and other minor errors or defects in any such reproduction of the
seal or any such signature shall not affect the validity or enforceability of
any Security which has been duly authenticated and delivered by the Trustee.
In case any such officer of the Issuer who shall have signed any of the
Securities shall cease to be such officer before the Security so signed shall
be authenticated and delivered by the Trustee or disposed of by the Issuer, such
Security nevertheless may be authenticated and delivered or disposed of as
though the Person who signed such Security had not ceased to be such officer of
the Issuer; and any Security may be signed on behalf of the Issuer by such
Persons as, at the actual date of the execution of such Security, shall be the
proper officers of the Issuer, although at the date of the execution and
delivery of this Indenture any such Person was not such officer.
SECTION 2.3 CERTIFICATE OF AUTHENTICATION. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinabove recited, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon
any Security executed by the Issuer shall be conclusive evidence that the
Security so authenticated has been duly authenticated and delivered hereunder
and that the Holder is entitled to the benefits of this Indenture.
SECTION 2.4 FORM, DENOMINATION AND DATE OF SECURITIES; PAYMENTS OF
EXCESS CASH FLOW IN CASH. The Securities and the Trustee's certificates of
authentication shall be substantially in the form recited above. The Securities
shall be issuable as registered securities without coupons and in denominations
provided for in the form of Security above recited. The Securities shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers of the Issuer executing the same may determine
with the approval of the Trustee.
Any of the Securities may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Indenture, as may be required to comply with any law
Page 14
or with any rules or regulations pursuant thereto, or with the rules of any
securities market in which the Securities are admitted to trading, or to conform
to general usage.
Each Security shall be dated the date of its authentication, shall bear
interest from the issue date of the Original Securities (June 30, 1996), and
Excess Cash Flow shall be payable on the dates established pursuant to Section
3.7. Nothing herein shall be construed to require the payment of interest which
was heretofore paid under the Original Securities.
The Person in whose name any Security is registered at the close of
business on any Record Date as provided herein shall be entitled to receive such
Holder's allocation of Excess Cash Flow as provided in Section 3.7, if any,
payable on such Cash Flow Payment Date notwithstanding any transfer or exchange
of such Security subsequent to the Record Date and prior to such Cash Flow
Payment Date, except if and to the extent the Issuer shall default in the
payment due on such Cash Flow Payment Date, in which case such defaulted payment
shall be paid to the Persons in whose names Outstanding Securities are
registered at the close of business on a subsequent Record Date established
after arrangements for payment reasonably satisfactory to the Trustee have been
made by the Issuer by notice given by mail by or on behalf of the Issuer to the
Holders of Securities not less than 7 days preceding such subsequent Record
Date.
SECTION 2.5 REGISTRATION, TRANSFER AND EXCHANGE. The Issuer will keep
at each office or agency to be maintained for the purpose as provided in Section
3.2 a register or registers in which, subject to such reasonable regulations as
it may prescribe, it will register, and will register the transfer of,
Securities as in this Article provided. Such register shall be in written form
in the English language or in any other form capable of being converted into
such form within a reasonable time. At all reasonable times such register or
registers shall be open for inspection by the Trustee.
Upon due presentation for registration of transfer of any Security at
each such office or agency, the Issuer shall execute and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new
Security or Securities in authorized denominations for a like aggregate
principal amount.
Any Security or Securities may be exchanged for a Security or Securities
in other authorized denominations, in an equal aggregate principal amount.
Securities to be exchanged shall be surrendered at each office or agency to be
maintained by the Issuer for the purpose as provided in Section 3.2, and the
Issuer shall execute and the Trustee shall authenticate and deliver in exchange
therefor the Security or Securities which the Securityholder making the exchange
shall be entitled to receive, bearing numbers not contemporaneously Outstanding.
All Securities presented for registration of transfer, exchange,
redemption or payment shall (if so required by the Issuer or the Trustee) be
duly endorsed by, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Issuer and the Trustee duly executed by,
the Holder or his attorney duly authorized in writing.
Page 15
The Issuer may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any exchange or
registration of transfer of Securities. No service charge shall be made for
any such transaction.
The Issuer shall not be required to exchange or register a transfer of
(a) any Securities for a period of 15 days next preceding the first mailing of
notice of redemption of Securities to be redeemed or (b) any Securities
selected, called or being called for redemption.
All Securities issued upon any transfer or exchange of Securities shall
be valid obligations of the Issuer, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Securities surrendered upon such
transfer or exchange.
SECTION 2.6 MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN SECURITIES.
In case any temporary or definitive Security shall become mutilated, defaced or
be apparently destroyed, lost or stolen, the Issuer in its discretion, which
shall not be unreasonably withheld, may execute, and upon the written request of
an officer of the Issuer, the Trustee shall authenticate and deliver, a new
Security bearing a number not contemporaneously Outstanding, in exchange and
substitution for the mutilated or defaced Security, or in lieu of or in
substitution for the Security so apparently destroyed, lost or stolen. In every
case the applicant for a substitute Security shall furnish to the Issuer and to
the Trustee and any agent of the Issuer or the Trustee such security or
indemnity agreement or bond as may be required by them to indemnify and defend
and to save each of them harmless and, in every case of destruction, loss or
theft, evidence to their satisfaction of the apparent destruction, loss or theft
of such Security and of the ownership thereof.
Upon the issuance of any substitute Security, the Issuer may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the
reasonable fees and expenses of the Trustee) connected therewith. In case any
Security which has matured or is about to mature shall become mutilated or
defaced or be apparently destroyed, lost or stolen, the Issuer may, instead of
issuing a substitute Security, pay or authorize the payment of the same with
written direction to the Trustee (without surrender thereof except in the case
of a mutilated or defaced Security), if the applicant for such payment shall
furnish to the Issuer and to the Trustee and any agent of the Issuer or the
Trustee such security or indemnity (including a bond) as any of them may require
to save each of them harmless from all risks, however remote, and in every case
of apparent destruction, loss or theft the applicant shall also furnish to the
Issuer and the Trustee and any agent of the Issuer or the Trustee evidence to
their satisfaction of the apparent destruction, loss or theft of such Security
and of the ownership thereof.
Every substitute Security issued pursuant to the provisions of this
Section 2.6 by virtue of the fact that any Security is apparently destroyed,
lost or stolen shall constitute an additional contractual obligation of the
Issuer, whether or not the apparently destroyed, lost or stolen Security shall
be at any time enforceable by anyone and shall be entitled to all the benefits
of (but shall be subject to all the limitations of rights set forth in) this
Indenture equally and proportionately with any and all other Securities duly
authenticated and delivered hereunder. All
Page 16
Securities shall be held and owned upon the express condition that, to the
extent permitted by law, the foregoing provisions are exclusive with respect to
the replacement or payment of mutilated, defaced, or apparently destroyed, lost
or stolen Securities and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.7 CANCELLATION OF SECURITIES; DISPOSITION THEREOF. All
Securities surrendered for payment, redemption, registration of transfer or
exchange, if surrendered to the Issuer or any agent of the Issuer or the
Trustee, shall be delivered to the Trustee for cancellation or, if surrendered
to the Trustee, shall be cancelled by it; and no Securities shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee shall destroy cancelled Securities held by it and
deliver a certificate of destruction to the Issuer from time to time. If the
Issuer shall acquire any of the Securities, such acquisition shall not operate
as a redemption or satisfaction of the Indebtedness represented by such
Securities unless and until the same are delivered to the Trustee for
cancellation. The Securities issued herein shall be delivered to the respective
Holder upon surrender and cancellation of the securities issued pursuant to the
Original Indenture.
SECTION 2.8 TEMPORARY SECURITIES. Pending the preparation of definitive
Securities, the Issuer may execute and the Trustee shall authenticate and
deliver temporary Securities (printed, lithographed, typewritten or otherwise
reproduced, in each case in form satisfactory to the Trustee). Temporary
Securities shall be issuable as registered securities without coupons, of any
authorized denomination, and substantially in the form of the definitive
Securities but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Issuer
with the concurrence of the Trustee. Temporary Securities may contain such
reference to any provisions of this Indenture as may be appropriate. Every
temporary Security shall be executed by the Issuer and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Securities. Without unreasonable delay the
Issuer shall execute and shall furnish definitive Securities and thereupon
temporary Securities may be surrendered in exchange therefor without charge at
each office or agency to be maintained by the Issuer for the purpose pursuant to
Section 3.2, and the Trustee shall authenticate and deliver in exchange for such
temporary Securities a like aggregate principal amount of definitive Securities
of authorized denominations. Until so exchanged, the temporary Securities shall
be entitled to the same benefits under this Indenture as definitive Securities.
The Issuer shall not be obligated to issue definitive Securities until it or the
Trustee shall have received such temporary Securities and until the securities
issued pursuant to the Original Indenture have been surrendered and cancelled.
Page 17
ARTICLE 3
COVENANTS OF THE ISSUER
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer covenants and
agrees that it will duly and punctually pay or cause to be paid the principal
of, and interest on, each of the Securities at the place or places, at the
Maturity Date or such earlier date as provided herein and in the manner provided
in the Securities. An installment of principal or interest shall be considered
paid on the Maturity Date or such earlier date as provided herein if the Trustee
or Paying Agent holds on that date sums to pay the installment. Anything herein
or in the Securities to the contrary notwithstanding, the obligation of the
Issuer hereunder shall be subject to the limitation that payments of interest to
the Holder shall not be required to the extent that the receipt of any such
payment by such Holder would be contrary to the provisions of law applicable to
the Issuer which limit the maximum rate of interest which may be charged or
collected by the Issuer, including as set forth in Section 11.12 (the "MAXIMUM
RATE").
SECTION 3.2 OFFICES FOR PAYMENTS, ETC. So long as any of the Securities
remain Outstanding, the Issuer will maintain at such place in the City of New
York and at such other place, if any, as may be designated by the Issuer, the
following: (a) an office or agency where the Securities may be presented for
registration of transfer, for exchange and for conversion as in this Indenture
provided and (b) an office or agency where notices and demands to or upon the
Issuer in respect of the Securities or of this Indenture may be served. The
Issuer will initially maintain such offices or agencies with the corporate
secretary at the Issuer's principal place of business. The Issuer will give to
the Trustee written notice of the location of any such office or agency and of
any change of location thereof. In case the Issuer shall fail to maintain any
such office or agency or shall fail to give such notice of the location or of
any change in the location thereof, presentations and demands may be made and
notices may be served at the Corporate Trust Office.
SECTION 3.3 APPOINTMENT TO FILL A VACANCY IN OFFICE OF TRUSTEE. The
Issuer, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 6.10, a Trustee, so that there
shall at all times be a Trustee hereunder.
SECTION 3.4 PAYING AGENTS. Whenever the Issuer shall appoint a paying
agent other than the Trustee or itself, it will cause such paying agent to
execute and deliver to the Trustee an instrument in which such agent shall agree
with the Trustee, subject to the provisions of this Section 3.4:
(a) that it will hold all sums received by it as such agent for the
payment of the principal of or interest on the Securities (whether such sums
have been paid to it by the Issuer or by any other obligor on the Securities) in
trust for the benefit of the Holders of the Securities or of the Trustee; and
Page 18
(b) that it will give the Trustee notice of any failure by the Issuer
(or by any other obligor on the Securities) to make any payment of the principal
of or interest on the Securities when the same shall be due and payable.
The Issuer will, at least one Business Day prior to each due date of the
principal of or interest on the Securities, deposit with the paying agent a sum
which is in immediately available funds on the due date sufficient to pay such
principal or interest and (unless such paying agent is the Trustee) the Issuer
will promptly notify the Trustee of any failure to take such action.
If the Issuer shall act as its own paying agent, it will, on or before
each due date of the principal of or interest on the Securities, set aside,
segregate and hold in trust for the benefit of the Holders of the Securities a
sum sufficient to pay such principal or interest so becoming due. The Issuer,
or paying agent which is not the Trustee, will promptly notify the Trustee in
writing of any failure to take such action.
Notwithstanding anything in this Section 3.4 to the contrary, the Issuer
may at any time, for the purpose of obtaining a satisfaction and discharge of
this Indenture or for any other reason, pay or cause to be paid to the Trustee
all sums held in trust by the Issuer or any paying agent hereunder, as required
by this Section 3.4, such sums to be held by the Trustee upon the trusts herein
contained.
Notwithstanding anything in this Section 3.4 to the contrary, the
agreement to hold sums in trust as provided in this Section 3.4 is subject to
the provisions of Sections 10.4 and 10.5.
The Issuer initially appoints Trans World Gaming Corp. as paying agent.
SECTION 3.5 OFFICERS' CERTIFICATES AS TO DEFAULT AND AS TO COMPLIANCE.
The Issuer will, so long as any of the Securities are Outstanding:
(a) deliver to the Trustee, forthwith upon becoming aware of any
default or defaults in the performance of any covenant, agreement or
condition contained in this Indenture (including notice of any event
which with the giving of notice, lapse of time or both would become an
Event of Default under Section 5.1 hereof), an Officers' Certificate
specifying such default or defaults; and
(b) deliver to the Trustee within 90 days after the end of each
fiscal year of the Issuer beginning with the fiscal year ending December
31, 1996, an Officers' Certificate, to the effect that:
(i) a diligent review of the activities of the Issuer
and its Subsidiaries during such year and of performance under
this Indenture has been made under such officers' supervision, and
(ii) to the best of such officers' knowledge, based on
such review, the Issuer has fulfilled all its obligations under
this Indenture throughout such year, or
Page 19
if there has been a default in the fulfillment of any such
obligation, specifying each such default known to them and the
nature and status thereof.
SECTION 3.6 MAINTENANCE OF PROPERTIES, ETC. Subject to Section 3.12,
the Issuer shall, and TWG shall cause TWG Louisiana and each of the Subsidiaries
of TWG Louisiana to, maintain its material properties and assets in working
order and condition and make all necessary repairs, renewals, replacements,
additions, betterments and improvements thereto, all as in the judgment of the
Issuer may be necessary so that the business carried on in connection therewith
may be conducted at all usual and ordinary times.
The Issuer shall, and TWG shall cause TWG Louisiana and each of TWG
Louisiana's Subsidiaries to, maintain with insurers that TWG believes in good
faith to be financially sound and reputable such insurance as may be required by
law and such other insurance, to such extent and against such hazards and
liabilities, as it in good faith determines is customarily maintained by
companies similarly situated with like properties.
Subject to Section 3.12 the Issuer shall, and TWG shall cause TWG
Louisiana and each of TWG Louisiana's Subsidiaries to do or cause to be done
all things necessary to preserve and keep in full force and effect its
existence, rights and franchises, except to the extent permitted by this
Indenture and except in such cases where the Board of Directors determines in
good faith that failure to do so would not have a material adverse effect on the
business, earnings, properties, assets, financial condition or results of
operation of TWG Louisiana and its Subsidiaries taken as a whole.
The Issuer shall, and TWG shall cause TWG Louisiana and each of TWG
Louisiana's Subsidiaries to, comply in all material respects with all statutes,
laws, ordinances, or government rules and regulations to which it is subject.
The Issuer shall, and TWG shall cause TWG Louisiana and each of TWG
Louisiana's Subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies except as contested in good faith and by appropriate
proceedings.
SECTION 3.7 EXCESS CASH FLOW PAYMENT. Not less than twenty (20)
days following each two calendar month period, with the first such two month
period commencing April 1, 1998, the Issuer shall (a) deposit in immediately
available funds with the Trustee in a fund which the Trustee may establish for
the benefit of the Securityholders an aggregate amount equal to Excess Cash
Flow, if any, for the prior two month period, and (b) regardless of whether any
repayment of principal is required under this Section, provide the Trustee and
each Securityholder with a written notice containing in reasonable detail the
Issuer's calculation of Excess Cash Flow. Excess Cash Flow shall be applied
first to accrued, unpaid interest on an equal and ratable basis among the
Securityholders in proportion, as nearly as practicable, to the respective
unpaid principal amount due each Securityholder, adjusted for any reduction in
principal as to any Securityholder pursuant to Section 13, so that the sum
distributed accurately reflects the interest accrued by such Securityholder as a
percentage of the total interest paid for in such two month period and the
balance thereof shall be applied to principal as set
Page 20
forth herein. Any repayments of principal required by this Section shall be
paid on an equal and ratable basis among the Securityholders in proportion, as
nearly as practicable, to the respective unpaid principal amounts of the
Securities held by each Securityholder without taking into account any reduction
in principal pursuant to Section 13, except to the extent such failure to take
into account such principal reductions pursuant to Section 13 would result in a
payment of an amount in excess of the principal sum due to such Securityholder.
The reduction in the principal amount of the Securities effected by repayments
made under this Section may be made without presentation of the Securities and
shall be binding on all future Securityholders. Securityholders shall make the
appropriate notation on the Securities to indicate the amount of any repayments
under this Section. If there is no Excess Cash Flow, nothing herein shall be
construed to create an obligation to make a payment for such period.
The Excess Cash Flow payment will be made in the following manner. At
least 5 days (or other period of time the Issuer and the Trustee may agree upon)
prior to the date on which the Issuer is required to make such the payment
required by this Section 3.7, the Issuer shall give the Trustee written notice
of such payment, which notice shall state the amount of the payment, certify
that such payment is equal to Excess Cash Flow for the applicable period, and
set forth the date the Issuer has selected that the payment be made ("Cash Flow
Payment Date"). The Record Date (herein so called) to determine the Holders who
shall be entitled to receive the payment shall be 10 Business Days before the
Cash Flow Payment Date selected by the Issuer. The Trustee shall not be
required to send a notice of the prepayment to the Holders with respect to such
payment. When the money to effect the payment of the Securities is held by the
Trustee for the purpose of effecting such payment, interest on that portion of
the Securities to be prepaid shall cease to accrue on the Principal being
reduced by the payment. The Trustee and the Holders shall make notations with
respect to the reduction of principal on Securities made a result of the
payment, and such notations of the Trustee shall be binding on the
Securityholders and all future Securityholders, even if such holders do not make
such notations on the certificates representing such Securities. The payments
will be made by the Trustee in increments of $100.00. Any Excess Cash Flow
which does not meet this requirement will be returned to the Issuer pursuant to
its written instructions and will be Undistributed Excess Cash Flow.
SECTION 3.8 BOOKS. Issuer will keep at all times proper books of record
and account in which full, true and correct entries will be made of its
transactions in accordance with Generally Accepted Accounting Principles.
SECTION 3.9 GUARANTEES. Issuer will not guarantee on a basis senior in
right of payment to the Securities, directly or indirectly, any obligation or
indebtedness of any other Person. Nothing herein shall be construed to (i)
prohibit the issuance of the Bishkek Note, the Czech Notes, or the Funding Note,
or (ii) permit the issuance of any indebtedness that would be secured by the
Collateral granted to the Holders.
SECTION 3.10 SENIOR INDEBTEDNESS. Issuer will not incur, create, assume
or at any time become liable, contingently or otherwise for any borrowed or
other indebtedness that is senior in right of payment to the Securities, other
than the Bishkek Note. Nothing herein shall be
Page 21
construed to (i) prohibit the issuance of the Bishkek Note, the Czech Notes, or
the Funding Note; or (ii) permit the issuance of any indebtedness that would be
secured by the Collateral granted to the Holders. Nothing herein shall be
construed to permit the issuance of any indebtedness secured by the Collateral
(this clause shall not be construed to prohibit the Bishkek Note or the Czech
Note).
SECTION 3.11 DISTRIBUTIONS. Issuer will not declare or pay, or set
apart any funds for the payment of, any dividend on any shares of Capital Stock
by reduction of capital surplus or otherwise, or make any distribution in
respect of shares of Capital Stock or redeem, repurchase, or effect any other
sale, or exchange, upon any of its Capital Stock.
SECTION 3.12 DISPOSITION OF ASSETS. Issuer will not sell, assign,
lease, transfer or otherwise dispose of, to any third party, in any transaction
or series of transactions, all or any portion of its properties or assets,
except for sales, assignments, leases, transfers, or dispositions at fair market
value, of properties or assets, where such net proceeds are utilized by the
Issuer to invest in its existing business, except, in the event Issuer
determines in good faith (or to the extent so directed by the holders of 50% of
the Securities) that it is no longer able to operate a gambling facility
(including as a result of a loss of its license to operate such a facility or as
a result of a loss of a premises lease). Upon such determination, Issuer shall
take all actions necessary and appropriate to promptly liquidate such assets
which comprise the facility which has ceased operations in such manner as shall
realize proceeds which reasonably represent the fair market value thereof. This
Section shall not govern the Capital Stock or assets of TWG International, TWG
Finance, or Subsidiaries of either.
SECTION 3.13 LINE OF BUSINESS. TWG shall not permit to TWG
International to, and shall not permit any of TWG International's Subsidiaries
to, engage in any business other than acquiring, developing and operating local
casinos outside the United States of America. TWG shall not, and shall not
permit any of its Subsidiaries, (other than TWG International and its
Subsidiaries) to engage in any business other than acquiring, developing and
operating local casinos inside of the United States and marketing activities
relating thereto, other than the Bishkek Facility, which may be operated by TWG.
TWG Finance shall not engage in any business other than performance of its
obligations arising under the Czech Note, Funding Note, and all documents
related to those two transactions (including indentures).
SECTION 3.14 PAYMENTS FOR CONSENT. None of the Issuers shall, nor shall
permit any Subsidiary to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder of
the Securities for or as an inducement to any consent, waiver or amendment of
any terms or provisions of the Securities unless such consideration is offered
to be paid or agreed to be paid to all Holders of the Securities which so
consent, waive or agree in the time frame set forth in solicitation documents
relating to such consent, waiver or agreement.
SECTION 3.15 COST OF OPERATIONS. TWG International shall be solely
responsible for all costs of operating TWG Finance, TWG International and TWG
International's direct and indirect Subsidiaries. In addition, TWG
International shall be responsible for costs of
Page 22
administration of TWG in the sum of $25,000 per month, through June 30, 1999,
and for one hundred percent of such costs of administration from the earlier of
(a) the date TWG no longer has adequate cash from its business operations in
Louisiana to pay such costs, or (b) after June 30, 1999. TWG shall be solely
responsible for (a) costs associated with its existing operations in the United
States, (b) costs of administration of TWG in excess of $25,000 per month
through the earlier of June 30, 1999 or the date TWG no longer has adequate cash
from its business operations in Louisiana to pay such costs. Income generated
from the Bishkek Facility, as well as cage cash in Louisiana and Bishkek and
assets located in Louisiana subject to the security interest herein on the
Collateral shall not be used to fund administrative costs. Cost of
administration refers to all costs associated with the TWG corporate
headquarters in New York and London, including rent and salaries and expenses of
all officers and employees at such location (or any successor location).
Nothing herein shall prohibit TWG International from reimbursing TWG as to costs
incurred in the acquisition of the Czech Casinos, this Indenture, the Czech
Indenture and the Funding Indenture, up to the sum of $250,000 at the closing of
the Czech Indenture, or directly paying all unpaid costs related to those
transactions.
SECTION 3.16 [Reserved].
SECTION 3.17 WAIVER OF STAY, EXTENSION OR USURY LAWS. The Issuer
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, or plead, or in any manner whatsoever claim, and shall resist
any and all efforts to be compelled to take the benefit or advantage of, any
stay or extension law or any usury law or other law which would prohibit or
forgive the Issuer from paying all or any portion of the principal of or
interest on the Securities as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
the Issuer hereby expressly waives all benefit or advantage of any such law and
covenants that it shall not 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 had been enacted.
SECTION 3.18 BISHKEK NOTE. All sums earned by TWG's operations at
Bishkek (net of operating costs of such Bishkek Facility) shall be used to repay
the Bishkek Note, until the Bishkek Note is paid in full, and then shall be used
toward the repayment of the Securities.
SECTION 3.19 SECURITY INTEREST. The Issuer shall execute documents
necessary to renew, affirm, reinstate, restate, replace and amend the Securities
and the security interest granted in all real and personal property of the
Issuer in the State of Louisiana. Such documents shall be prepared, executed,
delivered and filed by no later than December 31, 1998, unless extended in
writing by a majority of the holders of the Securities. The Issuer shall
reimburse all reasonable costs, including attorneys fees incurred by the
Securityholders and Trustee in preparing and executing such documents.
Page 23
ARTICLE 4
SECURITYHOLDERS' LISTS AND REPORTS
BY THE ISSUER AND THE TRUSTEE
SECTION 4.1 ISSUER TO FURNISH TRUSTEE INFORMATION AS TO NAMES AND
ADDRESSES OF SECURITYHOLDERS. The Issuer covenants and agrees that it will
furnish or cause to be furnished to the Trustee a list in such form as the
Trustee may reasonably require of the names and addresses of the Holders of the
Securities:
(a) semi-annually and not more than 15 days after each record
date for the payment of interest on the Securities, as hereinabove
specified, as of such record date; and
(b) at such other times as the Trustee may request in writing,
within 30 days after receipt by the Issuer of any such request as of a
date not more than 15 days prior to the time such information is
furnished;
PROVIDED that if and so long as the Trustee shall be the Security registrar,
such list shall not be required to be furnished.
SECTION 4.2 PRESERVATION AND DISCLOSURE OF SECURITYHOLDERS' LISTS.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of
the Holders of Securities contained in the most recent list furnished to
it as provided in Section 4.1 or maintained by the Trustee in its
capacity as Security registrar, if so acting. The Trustee may destroy
any list furnished to it as provided in Section 4.1 upon receipt of a new
list so furnished.
(b) The Security register maintained by the Trustee as registrar
will be available for inspection by any Holder or its attorney duly
authorized in writing during normal business hours of the Trustee upon
reasonable prior notice.
SECTION 4.3 REPORTS BY THE ISSUER. The Issuer covenants:
(a) to file with the Commission, and within 15 days after the
Issuer files the same with the Commission, file with the Trustee, and
mail or furnish copies to the Trustee and cause the Trustee to mail to
the Holders at their addresses as set forth in the register of the
Securities, copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the
foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Issuer may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act or
which the Issuer would be required to file with the Commission if the
Issuer then had a class of securities registered under the Exchange Act;
Page 24
(b) to file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents, and reports with
respect to compliance by the Issuer with the conditions and covenants
provided for in this Indenture as may be required from time to time by
such rules and regulations;
(c) to cause its annual report to securityholders and any
quarterly or other financial reports furnished to its securityholders
generally to be filed with the Trustee and mailed, no later than the date
such materials are mailed or made available to the Issuer's
Securityholders to the Holders at their addresses as set forth in the
register of Securities; and
SECTION 4.4 Listing. The Issuer shall promptly notify the Trustee in
writing if the Securities become listed on any stock exchange and the Trustee
shall within thirty (30) days of receipt of such notice notify the Holders.
ARTICLE 5
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 EVENT OF DEFAULT DEFINED; ACCELERATION OF MATURITY; WAIVER
OF DEFAULT. In case one or more of the following Events of Default (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body) shall have occurred and be continuing:
(a) default in the payment of interest on the Securities as and
when the same becomes due and payable, and the continuance of such
default for 15 days; or
(b) default in the payment of all or any part of the principal on
the Securities as and when the same shall become due and payable either
at maturity, upon acceleration or redemption or otherwise; or
(c) failure on the part of the Issuer duly to observe or perform
any covenants or agreements on the part of the Issuer contained in the
Securities, in this Indenture, or any of the Collateral Agreements and
the continuance of such failure for a period of 15 days after the date on
which written notice specifying such failure, stating that such notice is
a "Notice of Event of Default" hereunder and demanding that the Issuer
remedy the same, is given to the Issuer by the Trustee or to the Issuer
and the Trustee by the Holders of at least 25% in aggregate principal
amount of the Securities at the time Outstanding; or
Page 25
(d) failure on the part of the Issuer to appoint a Trustee within
5 days of a written request of the holders of 25% in principal amount of
the securities to appoint a Trustee; or
(e) default 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 TWG, TWG Louisiana or any
Subsidiaries of TWG Louisiana (or the payment of which is Guaranteed by
TWG, TWG Louisiana or any Subsidiaries of TWG Louisiana), which default
is caused by a failure to pay due principal or interest on such
Indebtedness after any applicable grace period (a "Payment Default"), and
the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has
been and is continuing a Payment Default, aggregates $150,000 or more; or
(f) default 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 TWG, TWG Louisiana or any
Subsidiaries of TWG Louisiana (or the payment of which is Guaranteed by
TWG, TWG Louisiana or any Subsidiaries TWG Louisiana), which default
results in the acceleration of such Indebtedness prior to its express
maturity and the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has
been and is continuing a Payment Default or the maturity of which has
been so accelerated and not rescinded, aggregates $150,000 or more; or
(g) failure by TWG, TWG Louisiana or any Subsidiaries of TWG
Louisiana to pay final judgments (other than any judgment as to which a
reputable insurance company has accepted coverage without a reservation
of rights) aggregating in excess of $150,000, which judgments are not
stayed or discharged within 15 days after their entry; or
(h) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of TWG, TWG Louisiana or any
Subsidiaries of TWG Louisiana in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of TWG, TWG Louisiana or any
Subsidiaries of TWG Louisiana or for any substantial part of the property
of TWG, TWG Louisiana or any Subsidiaries of TWG Louisiana or ordering
the winding up or liquidation of the affairs of TWG, TWG Louisiana or any
Subsidiaries of TWG Louisiana and such decree or order shall remain
unstayed and in effect for a period of 15 consecutive days; or
(i) TWG, TWG Louisiana or any Subsidiaries of TWG Louisiana shall
commence a voluntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or consent to the entry of
an order for relief in an involuntary case under any such law, or consent
to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of TWG,
TWG Louisiana or any Subsidiaries of TWG Louisiana or for any substantial
part of the property of TWG, TWG Louisiana or any Subsidiaries of TWG
Louisiana, or TWG, of
Page 26
TWG Louisiana or any Subsidiaries of TWG Louisiana shall make any general
assignment for the benefit of creditors;
(j) indictment of any officer or Key Employee of TWG, TWG
Louisiana or any subsidiaries of TWG Louisiana by any governmental
authority;
(k) fraud by an officer or Key Employee of TWG, TWG Louisiana or
any subsidiaries of TWG Louisiana; or
(l) the Issuer does not pay, or shall be unable to pay, or shall
admit in writing its inability to pay its debts as such debts become due.
then, and in each and every such case (other than an Event of Default specified
in clause (h) or (i) above relating to the Issuer), unless the principal of all
of the Securities shall have already become due and payable, either the Trustee
or the Holders of not less than 50% in aggregate principal amount of the
Securities then Outstanding hereunder, by notice in writing to the Issuer (and
to the Trustee if given by Securityholders) (the "Acceleration Notice"), may
declare all the debt evidenced by the Securities to be due and payable
immediately (the "Acceleration Date"). If an Event of Default specified in
clause (h) or (i) above relating to the Issuer occurs, all the Securities and
the accrued interest thereon shall be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholder.
SECTION 5.2 COLLECTION OF INDEBTEDNESS BY TRUSTEE; TRUSTEE MAY PROVE
INDEBTEDNESS. The Issuer covenants that (a) in case default shall be made in
the payment of interest on any of the Securities on the date due and such
default shall have continued for a period of 15 days, or (b) in case default
shall be made in the payment of all or any part of the principal of any of the
Securities when the same shall have become due and payable, whether upon
maturity or upon any redemption or by declaration or otherwise -- then upon
demand by the Trustee the Issuer will pay to the Trustee for the benefit of the
Holders of the Securities the whole amount that then shall have become due and
payable on all such Securities for principal or interest, as the case may be
(with interest to the date of such payment upon the overdue principal and, to
the extent that payment of such interest is enforceable under applicable law, on
interest at the rate borne by the Securities); and in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including such amounts as shall be due the Trustee and each
predecessor Trustee under Section 6.6.
Until such demand is made by the Trustee, the Issuer may pay the
principal of and interest on the Securities to the registered Holders, whether
or not the Securities be overdue.
In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any action or proceeding at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Issuer or other obligor upon the Securities
and collect
Page 27
in the manner provided by law out of the Property of the Issuer or other
obligor upon the Securities, wherever situated, the moneys adjudged or decreed
to be payable.
In case there shall be pending proceedings relative to the Issuer or any
other obligor upon the Securities under Title 11 of the United States Code or
any other applicable Federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or the property of the Issuer or such other
obligor, or in case of any judicial proceedings relative to the Issuer or other
obligor upon the Securities, or to the creditors or property of the Issuer or
such other obligor, the Trustee, irrespective of whether the principal of the
Securities shall then be due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made any demand
pursuant to the provisions of this Section 5.2, shall be entitled and empowered,
by intervention in such proceedings or otherwise:
(a) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Securities, and
to file such other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for
reasonable compensation to the Trustee and each predecessor Trustee, and
their respective agents, attorneys and counsel, and for reimbursement of
all expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee, except as a result of negligence
or bad faith) and of the Securityholders allowed in any judicial
proceedings relative to the Issuer or other obligor upon the Securities,
or to the creditors or Property of the Issuer or such other obligor;
(b) unless prohibited by applicable law and regulations, to vote
on behalf of the Holders of the Securities in any election of a trustee
or a standby trustee in arrangement, reorganization, liquidation or other
bankruptcy or insolvency proceedings or Person performing similar
functions in comparable proceedings; and
(c) to collect and receive any moneys or other Property payable
or deliverable on any such claims, and to distribute all amounts received
with respect to the claims of the Securityholders and of the Trustee on
their behalf; and any trustee, receiver, or liquidator, custodian or
other similar official is hereby authorized by each of the
Securityholders to make payments to the Trustee, and, in the event that
the Trustee shall consent to the making of payments directly to the
Securityholders, to pay to the Trustee such amounts as shall be due the
Trustee, and each predecessor Trustee under Section 6.6.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Securityholder any plan or reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding except, as aforesaid, to vote for the election of a trustee
in bankruptcy or similar Person.
Page 28
All rights of action and of asserting claims under this Indenture, or
under any of the Securities, may be enforced by the Trustee without the
possession of any of the Securities or the production thereof on any trial or
other proceedings relative thereto, and any such action or proceedings
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Trustee, each predecessor
Trustee and their respective agents and attorneys, shall be for the ratable
benefit of the Holders of the Securities in respect of which such judgment has
been sought.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the Holders
of the Securities, and it shall not be necessary to make any Holders of the
Securities parties to any such proceedings.
SECTION 5.3 APPLICATION OF PROCEEDS. Any moneys collected by the
Trustee pursuant to this Article shall be applied in the following order at the
date or dates fixed by the Trustee and, in case of the distribution of such
moneys on account of principal or interest, upon presentation of the several
Securities and stamping (or otherwise noting) thereon the payment, or issuing
Securities in reduced principal amounts in exchange for the presented Securities
if only partially paid, or upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and each
predecessor Trustee under Section 6.6;
SECOND: In case the principal of the Securities shall not have become
and be then due and payable, to the payment of interest with interest (to the
extent that such interest has been collected by the Trustee) upon the
installments of interest at the Default Rate borne by the Securities, such
payments to be made ratably to the Persons entitled thereto, without
discrimination or preference;
THIRD: In case the principal of the Securities shall have become and
shall be then due and payable, to the payment of the whole amount then owing and
unpaid upon all the Securities for principal and interest, with interest upon
the overdue principal, and (to the extent that such interest has been collected
by the Trustee) upon installments of interest at the Default Rate borne by the
Securities; and in case such moneys shall be insufficient to pay in full the
whole amount so due and unpaid upon the Securities, then to the payment of such
principal and interest, without preference or priority of principal over
interest, or of interest over principal, or of any installment of interest over
any other installment of interest, or of any Security over any other Security,
ratably to the aggregate of such principal and accrued and unpaid interest; and
FOURTH: To the payment of the remainder, if any, to the Issuer or any
other Person lawfully entitled thereto.
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SECTION 5.4 SUITS FOR ENFORCEMENT. In case an Event of Default has
occurred, has not been waived and is continuing, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture or the Collateral Agreements by such appropriate judicial proceedings
as the Trustee shall deem most effectual to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or otherwise, whether for
the specific enforcement of any covenant or agreement contained in this
Indenture or the Collateral Agreements or in aid of the exercise of any power
granted in this Indenture or the Collateral Agreements or to enforce any other
legal or equitable right vested in the Trustee by this Indenture or the
Collateral Agreements or by law.
SECTION 5.5 RESTORATION OF RIGHTS ON ABANDONMENT OF PROCEEDINGS. In
case the Trustee shall have proceeded to enforce any right under this Indenture
and such proceedings shall have been discontinued or abandoned for any reason,
then and in every such case the Issuer and the Trustee shall be restored
respectively to their former positions and rights hereunder, and all rights,
remedies and powers of the Issuer, the Trustee and the Securityholders shall
continue as though no such proceedings had been taken.
SECTION 5.6 LIMITATIONS ON SUITS BY SECURITYHOLDERS. No Holder shall
have any right by virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or
otherwise upon or under or with respect to this Indenture, or for the
appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder, unless such Holder previously shall
have given to the Trustee written notice of an Event of Default and of the
continuance thereof, as hereinbefore provided, and unless also the Holders of
not less than 25% in aggregate principal amount of the Securities then
Outstanding shall have made written request upon the Trustee to institute such
action or proceeding in its own name as trustee hereunder and shall have offered
to the Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby and the Trustee for
30 days after its receipt of such notice, request and offer of indemnity shall
have failed to institute any such action or proceedings and no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 5.9; it being understood and intended, and being expressly
covenanted by the taker and Holder of every Security with every other taker and
Holder and the Trustee, that no one or more Holders of Securities shall have any
right in any manner whatever by virtue or by availing of any provision of this
Indenture to affect, disturb or prejudice the rights of any other Holder of
Securities, or to obtain or seek to obtain priority over or preference to any
other such Holder or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
Holders of Securities. For the protection and enforcement of the provisions of
this Section 5.6, each and every Securityholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 5.7 UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO INSTITUTE CERTAIN
SUITS. Notwithstanding any other provision in this Indenture and any provision
of any Security, the right of any Holder to receive payment of the principal of
and interest on such Security on or after the respective due dates expressed in
such Security, or to
Page 30
institute 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 5.8 POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER
OF DEFAULT. No right or remedy herein conferred upon or reserved to the Trustee
or to the Securityholders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or thereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
No delay or omission of the Trustee or of any Holder to exercise any
right or power accruing upon any Event of Default occurring and continuing as
aforesaid shall impair any such right or power or shall be construed to be a
waiver of any such Event of Default or an acquiescence therein; and subject to
Section 5.6, every power and remedy given by this Indenture or by law to the
Trustee or to the Securityholders may be exercised from time to time, as often
as shall be deemed expedient, by the Trustee or by the Securityholders.
SECTION 5.9 CONTROL BY SECURITYHOLDERS. The Holders of a majority in
aggregate principal amount of the Securities at the time Outstanding shall have
the right to direct the time, method, and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power conferred
on the Trustee by this Indenture; PROVIDED that such direction shall not be
otherwise than in accordance with law and the provisions of this Indenture;
PROVIDED, FURTHER, that the Trustee is provided with reasonable indemnification
by the Holders prior to taking such action; and PROVIDED, FURTHER, that (subject
to the provisions of Section 6.1) the Trustee shall have the right to decline to
follow any such direction if the Trustee, being advised by counsel, shall
determine that the action or proceeding so directed may not lawfully be taken or
if the Trustee in good faith by its board of directors, the executive committee
or a trust committee of directors or Responsible Officers of the Trustee shall
determine that the action or proceeding so directed would involve the Trustee in
any financial or other liability or if the Trustee in good faith shall so
determine that the actions or forbearances specified in or pursuant to such
direction shall be unduly prejudicial to the interests of Holders of the
Securities not joining in the giving of said direction, it being understood that
(subject to Section 6.1) the Trustee shall have no duty to ascertain whether or
not such actions or forbearances are unduly prejudicial to such Holders.
Nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not
inconsistent with such direction by Securityholders.
SECTION 5.10 WAIVER OF PAST DEFAULTS. The Holders of a majority in
aggregate principal amount of the Securities at the time Outstanding, by notice
to the Issuer and the Trustee, may on behalf of all Holders, upon providing the
Trustee with reasonable indemnity with respect to any action that might be taken
by the Holders not so consenting, provide forbearances, waive any default or
Event of Default hereunder and its consequences under this
Page 31
Indenture including acceleration, except a default in the payment of principal
of or interest on any of the Securities at the Maturity Date. In the case of
any such waiver, the Issuer, the Trustee and the Holders of the Securities shall
be restored to their former positions and rights hereunder, respectively; but no
such waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
Upon any such waiver, such default shall cease to exist and be deemed to
have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured, and not to have occurred for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or Event of Default or impair any right consequent thereon.
SECTION 5.11 TRUSTEE TO GIVE NOTICE OF DEFAULT, BUT MAY WITHHOLD IN
CERTAIN CIRCUMSTANCES. The Trustee shall transmit to the Securityholders, as
the names and addresses of such Holders appear on the registry books, notice by
mail of all defaults actually known to a Responsible Officer of the Trustee,
such notice to be transmitted within 90 days after the occurrence thereof,
unless such defaults shall have been cured before the giving of such notice (the
term "default" or "defaults" for the purposes of this Section 5.11 being hereby
defined to mean any event or condition which is, or with notice or lapse of time
or both would become, an Event of Default); PROVIDED that, except in the case of
default in the payment of the principal of or interest on any of the Securities,
the Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee, or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Securityholders.
SECTION 5.12 RIGHT OF COURT TO REQUIRE FILING OF UNDERTAKING TO PAY
COSTS. All parties to this Indenture agree, and each Holder by its acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, 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, suffered or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.12 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder or group of
Securityholders holding in the aggregate more than 10% in aggregate principal
amount of the Securities Outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
interest on any Security on or after the Maturity Date expressed in such
Security.
SECTION 5.13 EXCESS CASH FLOW. All references to payments of principal
and interest refer soley to the Excess Cash Flow payments required by Section
3.17 of this Indenture.
Page 32
ARTICLE 6
CONCERNING THE TRUSTEE
SECTION 6.1 DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING DEFAULT;
PRIOR TO DEFAULT. The Trustee, prior to the occurrence of an Event of Default
and after the curing or waiving of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default has
occurred (which has not been cured or waived) the Trustee shall exercise such of
the rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that:
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default which may have occurred:
(i) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, and
the Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein,
upon any statements, certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but
in the case of any such statements, certificates or opinions which
by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the requirements
of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a majority in principal amount
of the Securities at the time Outstanding relating to the time, method
and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture;
Page 33
(d) the Trustee shall not be charged with knowledge of an Event
of Default unless a Responsible Officer of the Trustee obtains written
notice of such default; and
(e) whether or not therein expressly so provided, every provision
of this Indenture relating to the conduct or affecting the liability of
or affording protection to the Trustee shall be subject to the provisions
of this Section 6.1.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial or
other liability in the performance of any of its duties or in the exercise of
Any of its rights or powers, if repayment of such funds or adequate indemnity
against such liability is not assured to the reasonable satisfaction of the
Trustee.
SECTION 6.2 CERTAIN RIGHTS OF THE TRUSTEE. SUBJECT TO SECTION 6.1:
(a) the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
Officers' Certificate or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, debenture, note,
coupon, security or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Issuer
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed), and any resolution of the Board of Directors
may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Issuer;
(c) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Indenture at the request, order
or direction of any of the Securityholders pursuant to the provisions of
this Indenture, unless such Securityholders shall have offered to the
Trustee reasonable security and/or indemnity against the costs, expenses
and liabilities which might be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or within
the discretion, rights or powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default hereunder and
after the curing or waiving of all Events of Default which may have
occurred, the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order,
Page 34
approval, appraisal, bond, debenture, note, coupon, security, or other
paper or document unless requested in writing so to do by the Holders of
not less than a majority in aggregate principal amount of the Securities
then Outstanding; PROVIDED that if the payment within a reasonable time
to the Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of
the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expenses or liabilities as a condition
to proceeding; the reasonable expenses of every such examination shall be
paid by the Issuer or, if paid by the Trustee or any predecessor trustee,
shall be repaid by the Issuer upon demand; and
(g) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys, custodians or nominees not regularly in its employ and the
Trustee shall not be responsible for any misconduct or negligence on the
part of any such agent, attorney, custodian or nominee appointed with due
care by it hereunder.
(h) the Trustee makes no representation as to the validity or
adequacy of this Indenture, the Collateral, or the Securities. It shall
not be accountable for the Issuers' use of the proceeds from the sale of
the Securities, and it shall not be responsible for any statement in the
Securities, other than its authentication. Except required by Section
14.6 of this Indenture, the Trustee shall not be responsible for any
recording, re-recording, filing or refiling of this Indenture or other
document to perfect the security interest in the Collateral. The Trustee
shall not be bound to ascertain or inquire as to the performance of the
obligations of the Issuer under this Indenture or the Collateral
Agreements. The Trustee may nevertheless require the Issuer to furnish
information regarding performance of its obligations hereunder and under
the Collateral Agreements, but is not obligated to do so.
SECTION 6.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF
SECURITIES OR APPLICATION OF PROCEEDS THEREOF. The recitals contained herein
and in the Securities, except the Trustee's certificates of authentication,
shall be taken as the statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee shall not be accountable for the use or application by
the Issuer of any of the Securities or of the proceeds thereof. The Trustee
shall not be accountable or responsible for any information, statement or
recital in any prospectus, private offering memorandum or any other disclosure
material prepared or distributed in connection with the distribution of the
Securities.
SECTION 6.4 TRUSTEE AND AGENTS MAY HOLD SECURITIES; COLLECTIONS, ETC.
The Trustee or any agent of the Issuer or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities with the same
rights it would have if it were not the Trustee or such agent and, subject to
Sections 6.8 and 6.13, if operative, may otherwise deal with the Issuer and
receive, collect, hold and retain collections from the Issuer with the same
rights it would have if it were not the Trustee or such agent.
Page 35
SECTION 6.5 MONEYS HELD BY TRUSTEE. Subject to the provisions of
Section 10.6 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Issuer or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 6.6 COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS PRIOR
CLAIM. The Issuer covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) and the Issuer covenants and agrees to pay or reimburse the
Trustee and each predecessor Trustee upon its request for all reasonable
expenses, (including, without limitation, expenses incurred in connection with
notices and other communications to Holders) disbursements and advances incurred
or made by or on behalf of it in accordance with any of the provisions of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all agents and other Persons not regularly
in its employ) except any such expense, disbursement or advance as may arise
from its negligence or bad faith. The Issuer also covenants to indemnify the
Trustee, and each predecessor trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
Indenture or the trusts hereunder and its duties hereunder, including the costs
and expenses of defending itself against or investigating any claim of liability
in the premises. The obligations of the Issuer under this Section 6.6 to
compensate and indemnify the Trustee and each predecessor trustee and to pay or
reimburse the Trustee and each predecessor trustee for expenses, disbursements
and advances shall constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge of this Indenture. Such additional
indebtedness shall be a senior claim to that of the Securities upon all Property
and funds held or collected by the Trustee as such, except funds held in trust
for the benefit of the Holders of particular Securities, and the Securities are
hereby subordinated to such senior claim. The Trustee and Issuer shall enter
into a Fee Agreement acceptable to the Trustee and Issuer.
SECTION 6.7 RIGHT OF TRUSTEE TO RELY ON OFFICERS' CERTIFICATE, ETC.
Subject to Section 6.1, whenever in the administration of the trusts of this
Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of bad faith on the part of the
Trustee, be deemed to be conclusively proved and established by an Officers'
Certificate delivered to the Trustee, and such certificate, in the absence of
bad faith on the part of the Trustee, shall be full warrant and protection to
the Trustee for any action taken, suffered or omitted by it under the provisions
of this Indenture upon the faith thereof.
Page 36
SECTION 6.8 [Reserved].
SECTION 6.9 PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. The Trustee
hereunder shall at all times be a corporation organized and doing business under
the laws of the United States of America or of any State or territory or of the
District of Columbia having a combined capital and surplus of at least
$50,000,000 (or being a member of a bank holding system with an aggregate
combined capital and surplus), and which is authorized under such laws to
exercise corporate trust powers and is subject to supervision or examination by
Federal, State, territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section 6.9, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. Neither the Issuer nor any
Person directly or indirectly controlling, controlled by or under common control
with the Issuer may serve as Trustee hereunder. In case at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
6.9, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.10.
SECTION 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR TRUSTEE.
The Trustee may resign at any time by so notifying the Issuer in writing, such
resignation to be effective upon the appointment of a successor Trustee. The
Holders of a majority in principal amount of the Outstanding Securities may
remove the Trustee by so notifying the Trustee in writing and may appoint a
successor Trustee with the Issuer's consent which consent shall not be
unreasonably withheld. The Issuer may remove the Trustee if:
(a) the Trustee fails to comply with Section 6.8 or 6.9;
(b) the Trustee is adjudged a bankrupt or an insolvent;
(c) a receiver or other 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 Trustee in such event being referred to herein as
the retiring Trustee), the Issuer shall promptly appoint a successor Trustee
that is reasonably acceptable to the Holders of a majority in principal amount
of the Securities. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the Securities may appoint a
successor Trustee to replace the successor Trustee appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Issuer. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee (subject to the senior claim provided in Section 6.6 and upon being paid
the compensation due to it in Section 6.6), the resignation or removal of the
Page 37
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture. A
successor Trustee shall mail notice of its succession to each Securityholder.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 25% in principal amount of the Outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 6.8, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section 6.10,
the Issuer's obligations under Section 6.6 shall continue for the benefit of the
retiring Trustee.
SECTION 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any
successor trustee appointed as provided in Section 6.10 shall execute and
deliver to the Issuer and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of the Issuer or of the successor trustee, the trustee ceasing to act shall upon
being paid the amounts due it under Section 6.6 pay over to the successor
trustee all moneys at the time held by it hereunder and shall execute and
deliver an instrument transferring to such successor trustee all such rights,
powers, duties and obligations. Upon request of any such successor trustee, the
Issuer shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a prior
claim upon all Property or funds held or collected by such trustee to secure any
amounts then due it pursuant to the provisions of Section 6.6.
No successor trustee shall accept appointment as provided in this Section
6.11 unless at the time of such acceptance such successor trustee shall be
qualified under the provisions of Section 6.8 and eligible under the provisions
of Section 6.9. No Trustee under this Indenture shall be personally liable for
any action or omission of any successor trustee.
SECTION 6.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS
OF TRUSTEE. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to the corporate trust business of the Trustee, shall
be the successor of the Trustee hereunder, PROVIDED that such corporation shall
be qualified under the provisions of Section 6.8 and eligible under the
provisions of Section 6.9, without the execution or filing of any paper or any
Page 38
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee to authenticate Securities in the name of
any predecessor Trustee shall have; PROVIDED that the right to adopt the
certificate of authentication of any predecessor Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
SECTION 6.13 [Reserved].
SECTION 6.14 TRUST ESTATE MAY BE VESTED IN CO-TRUSTEE OR IN A SUB-
TRUST. It is the purpose of this Indenture that there shall be no violation of
any law of any jurisdiction denying or restricting of the right of banking
corporations or associations to transact business as Trustee in such
jurisdiction. Accordingly, at any time or times and for the purpose of meeting
any legal requirements of any jurisdiction, (i) a sub-trust ("Sub-Trust") may be
created as provided herein pursuant to the terms of which the Settlers of the
Sub-Trust may appoint an individual or financial institution to serve as a
trustee thereunder (Sub-Trustee"), and (ii) the Trustee shall have the power to
appoint, and the Issuer shall for such purpose join with the Trustee in the
execution, delivery and performance of all instruments and agreements necessary
or proper to appoint, one or more persons or entities approved by the Trustee
either to act as co-trustee or co-trustees, jointly with the Trustee, of all or
any part of the property subject to the trust created by this Indenture.
If the appointment of a co-trustee is not sufficient to allow the Trustee
to avoid violating any law of the state jurisdiction denying or restricting the
Trustee's right to transact business as Trustee in such jurisdiction or to
exercise any of its remedies contained herein or any Collateral Document, then
the Trustee may execute, and the Issuer shall for such purpose join with the
Trustee, an instrument permitted by applicable law creating a Sub-trust for all
or a portion of the Trust Estate, including collateral securing the Securities.
Initially, the Issuer and the Trustee shall enter into an Act of Revocable
Donation and Trust in the form attached hereto as Exhibit A. Pursuant to such
instrument, the Issuer and the Trustee shall be the Settlers and Xxxx X.
Xxxxxxxxx shall serve as the initial trustee ("sub-trustee") pursuant to the
terms thereof.
The Sub-trustee shall be entitled to the same rights, privileges, and
immunities (but not the obligations) of the Trustee contained in Sections 6.1,
6.2, 6.3, 6.5 and 6.7 of this Indenture, in addition to the rights, privileges
and immunities contained in the Sub-trust. Further, the Issuer shall indemnify
the Sub-trustee to the same extent as provided in Section 6.6 of this Indenture.
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The Trustee shall be accountable to the Securityholders for the acts and
omissions of the Sub-trustee in accordance with the standard of care provided in
Section 6.1 hereof, subject to limitations thereon set forth in subsections (a)
through (e) thereof, but only so long as the Sub-trustee is an Affiliate of the
Trustee.
The Sub-trust shall be governed by the terms thereof.
The following provisions relate only to the situation in which a co-
trustee is appointed pursuant to the terms hereof and not to the Sub-trust.
Every co-trustee or separate trustee shall, to the extent permitted by
law, be appointed subject to the following terms:
(a) The Bonds shall be authenticated and delivered, and all
rights, powers, trusts, duties and obligations hereby conferred upon the
Trustee in respect to the custody, control and management of moneys,
papers, securities and other personal property shall be exercised, solely
by the Trustee.
(b) All rights, powers, trusts, duties and obligations
conferred or imposed upon the trustees shall be conferred or imposed upon
and exercised or performed by the Trustee, or by the Trustee and such
co-trustee or co-trustees or separate trustee or separate trustees
jointly, as shall be provided in the instrument appointing such
co-trustee or co-trustees or separate trustee or separate trustees,
except to the extent that, under the law of any jurisdiction in which any
particular act or acts are to be performed, the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such act or acts shall be performed by such co-trustee or co-trustees or
separate trustee or separate trustees.
(c) Any request in writing by the Trustee to any co-trustee or
separate trustee to take or to refrain from taking any action hereunder
shall be sufficient warrant for the taking, or the refraining from
taking, of such action by such co-trustee or separate trustee.
(d) Any co-trustee or separate trustee may, to the extent
permitted by law, delegate to the Trustee the exercise of any right,
power, trust, duty or obligation, discretionary or otherwise.
(e) The Trustee at any time, by any instrument in writing, with
the concurrence of the Issuer, may accept the resignation of or remove
any co-trustee or separate trustee appointed under this Section, and, in
case an Event of Default shall have occurred and be continuing, the
Trustee shall have power to accept the resignation of, or remove, any
such co-trustees or separate trustee without the concurrence of the
Issuer. Upon the request of the Trustee, the Issuer shall join with the
Trustee in the execution, delivery and performance of all instruments and
agreements necessary or proper to effectuate such resignation or removal.
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(f) No trustee hereunder shall be personally liable by reason
of any act or omission of other trustee hereunder, nor will the act or
omission of any trustee hereunder be imputed to any other trustee.
(g) Any demand, request, direction, appointment, removal,
notice, consent, waiver or other action in writing delivered to the
Trustee shall be deemed to have been delivered to each such co-trustee or
separate trustee.
(h) Any moneys, papers, securities or other items of personal
property received by any such co-trustee or separate trustee hereunder
shall forthwith, so far as may be permitted by law, be turned over to the
Trustee.
Upon the acceptance in writing of such appointment by any such co-trustee
or separate trustee, it or he or she shall be vested jointly with the Trustee
(except insofar as local law makes it necessary for any such co-trustee or
separate trustee to act alone) with such title to the property subject to the
trust created by this Indenture or any part thereof, and with such rights,
powers, duties or obligations, as shall be specified in the instrument of
appointment subject to all the terms hereof. Every such acceptance shall be
filed with the Trustee. To the extent permitted by law, any co-trustee or
separate trustee may, at any time by an instrument in writing, constitute the
Trustee its or his or her attorney-in-fact and agent, with full power and
authority to do all acts and things and to exercise all discretion on its or his
or her behalf and in its or his or her own name.
In case any co-trustee or separate trustee shall die, become incapable of
acting, resign or be removed, the title to the pledged property, and all rights,
powers, trusts, duties and obligations of said co-trustee or separate trustee
shall, so far as permitted by law, vest in and be exercised by the Trustee
unless and until a successor co-trustee or separate trustee shall be appointed
in the manner herein provided.
ARTICLE 7
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 EVIDENCE OF ACTION TAKEN BY SECURITYHOLDERS. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Securityholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Securityholders in Person or by agent 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. Proof of execution of any instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture and (subject to
Sections 6.1 and 6.2) conclusive in favor of the Trustee and the Issuer if made
in the manner provided in this Article.
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SECTION 7.2 PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF
SECURITIES. Subject to Sections 6.1 and 6.2, the execution of any instrument by
a Securityholder or his agent or proxy may be proved in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee. The holdings of Securities
shall be proved by the Security register or by a certificate of the registrar
thereof.
SECTION 7.3 HOLDERS TO BE TREATED AS OWNERS. The Issuer, the Trustee
and any agent of the Issuer or the Trustee may deem and treat the Person in
whose name any Security shall be registered upon the Security register as the
absolute owner of such Security (whether or not such Security shall be overdue
and notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of and, subject
to the provisions of this Indenture, interest on such Security and for all other
purposes; and neither the Issuer nor the Trustee nor any agent of the Issuer or
the Trustee shall be affected by any notice to the contrary. All such payments
so made to any such Person, or upon his order, shall be valid, and, to the
extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for moneys payable upon any such Security.
SECTION 7.4 SECURITIES OWNED BY ISSUER DEEMED NOT OUTSTANDING. In
determining whether the Holders of the requisite aggregate principal amount of
Securities have concurred in any direction, consent or waiver under this
Indenture, Securities which are directly owned by the Issuer (which shall not
include the Securityholders as of the date of Issue), except that for the
purpose of determining whether the Trustee shall be protected in relying on any
such direction, consent or waiver only Securities which the Responsible Officer
actually knows are so owned shall be so disregarded. Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Issuer or any
other obligor upon the Securities or any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Issuer or any other obligor of the Securities. In case of a dispute as to such
right, the advice of counsel shall be full protection in respect of any decision
made by the Trustee in accordance with such advice. Upon request of the
Trustee, the Issuer shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known by the Issuer
to be owned or held by or for the account of any of the above described Persons;
and, subject to Section 6.1, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth.
SECTION 7.5 RIGHT OF REVOCATION OF ACTION TAKEN. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 7.1, of
the taking of any action by the Holders of the percentage in aggregate principal
amount of the Securities specified in this Indenture in connection with such
action, any Holder of a Security the serial number of which is shown by the
evidence to be included among the serial numbers of the Securities the Holders
of which have consented to such action may, by filing written notice at the
Corporate Trust Office and upon proof of holding as provided in this Article,
revoke such action so far as concerns such Security. Except as aforesaid, any
such action taken by the Holder of any Security shall be conclusive and binding
upon such Holder and upon all future Holders and owners of
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such Security and of any Securities issued in exchange or substitution therefor,
irrespective of whether or not any notation in regard thereto is made upon any
such Security. Any action taken by the Holders of the percentage in aggregate
principal amount of the Securities specified in this Indenture in connection
with such action shall be conclusively binding upon the Issuer, the Trustee and
the Holders of all the Securities.
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF SECURITYHOLDERS.
The Issuer, when authorized by a resolution of its Board of Directors, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto for one or more of the following purposes:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(c) to provide for the assumption of the Issuer's obligations
hereunder to the Holders in the case of a merger or consolidation
pursuant to Article Nine hereof; or,
(d) With the consent of the holders of 50% of the Czech Notes, to
make any change that would provide any additional rights or benefits to
the Holders or that does not adversely affect the legal rights hereunder
of any Holder.
The Trustee is hereby authorized to join in the execution of any such
supplemental indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property thereunder, but the
Trustee shall not be obligated to enter into any such supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section
8.1 may be executed without the consent of the Holders of any of the Securities
at the time Outstanding, notwithstanding any of the provisions of Section 8.2.
SECTION 8.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS.
With the consent (evidenced as provided in Article Seven) of the Holders of (i)
not less than 50% in aggregate principal amount of the Securities at the time
Outstanding, and (ii) the holders of 50% in aggregate principal amount of the
Czech Notes at the time Outstanding, (including consents obtained in connection
with a tender offer or exchange offer for the Securities), the Issuer, when
authorized by a resolution of the Board of Directors, and the Trustee may, from
time to time and at any time, enter into an indenture or indentures
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supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or of modifying in any manner the rights of the Holders
of the Securities; PROVIDED that no such supplemental indenture shall, without
the consent of each Holder affected thereby and the holders of 75% in aggregate
principal amount of the Czech Notes with respect to subsections (i)-(iii) and
subsection (viii) as it relates to subsections (i)-(iii)) (with respect to any
Securities held by a non-consenting Securityholder), (i) reduce the principal
amount of Securities whose Holders must consent to an amendment, supplement or
waiver, (ii) reduce the principal of or change the fixed maturity of any
Security or alter the provisions with respect to the redemption of the
Securities, (iii) reduce the rate of or change the time for payment of interest
on any Security, (iv) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest on the Securities (except a
rescission of acceleration of the Securities by the Holders of at least a
majority in aggregate principal amount of the then Outstanding Securities and a
waiver of the payment default that resulted from such acceleration), (v) make
any Security payable in money other than that stated in the Securities, (vi)
make any change in the provisions of the Indenture relating to waivers of past
Defaults or the rights of Holders of Securities to receive payments of principal
of or interest on the Securities, (vii) waive a redemption payment with respect
to any Security, or (viii) make any change in the foregoing amendment and waiver
provisions.
The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any indenture
supplemental hereto. If a record date is fixed, then those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such supplemental indenture or to
revoke any consent previously given, whether or not such Persons continue to be
Holders after such record date. No such consent shall be valid or effective for
more than 90 days after such record date.
Upon the request of the Issuer accompanied by a copy of a resolution of
the Board of Directors certified by the Secretary or an Assistant Secretary of
the Issuer authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of the required
Securityholders and other documents, if any, required by Section 7.1, the
Trustee shall join with the Issuer in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
It shall not be necessary for the consent of the Securityholders under
this Section 8.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 8.2, the
Issuer shall mail a notice thereof by first-class mail to the Holders of
Securities provided, however, this section shall not prohibit the pledge or
granting of a security interest to the holders of the Czech Notes in the stock
and assets of TWG International and TWG Finance, and any of their respective
subsidiaries, or the foreclosure on
Page 44
such collateral by the holders of the Czech Notes, at their addresses as they
shall appear on the registry books of the Issuer, setting forth in general terms
the substance of such supplemental indenture. Any failure of the Issuer to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.
SECTION 8.3 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and be deemed to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Issuer and the Holders of Securities
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 8.4 DOCUMENTS TO BE GIVEN TO TRUSTEE. In connection with the
execution and delivery of any supplemental indenture pursuant to this Article
Eight, the Trustee shall receive an Officers' Certificate and an Opinion of
Counsel and, subject to the provisions of Sections 6.1 and 6.2, may rely thereon
as conclusive evidence that any such supplemental indenture complies with the
applicable provisions of this Indenture. The Opinion of Counsel delivered
pursuant to this Section 8.4 shall include a statement that the execution,
delivery and performance of such supplemental indenture by the Issuer shall not
result in a breach or violation of, or constitute a default under, this
Indenture. Subject to Section 6.1, the Trustee may conclusively rely on an
Opinion of Counsel with respect to the effect a supplemental indenture will have
on a Holder under Section 8.1(d).
SECTION 8.5 NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL
INDENTURES. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article may bear a
notation in form approved by the Trustee as to any matter provided for by such
supplemental indenture or as to any action taken at any such meeting. If the
Issuer or the Trustee shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared and executed by the Issuer, authenticated by the Trustee and
delivered in exchange for the Securities then Outstanding.
ARTICLE 9
NO CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Except with the prior written consent of each Holder, the Issuer shall
not consolidate with, or merge with or into (whether or not the Issuer is the
surviving corporation), or sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all of its properties or assets as an entirety
in one or more related transactions to, another corporation, person or entity,
except as permitted in Article 3. For purposes of this Article 9, the transfer
(by lease,
Page 45
assignment, sale or otherwise), in a single transaction or series of
transactions), of all or substantially all of the properties or assets of one or
more Subsidiaries of the Issuer, the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Issuer, shall be deemed to
be the transfer of all or substantially all of the properties and assets of the
Issuer, provided however, this section shall not prohibit the pledge or granting
of a security interest to the holders of the Czech Notes in the stock and assets
of TWG International and TWG Finance, and of any of their respective
subsidiaries, or the foreclosure on such collateral by the holders of the Czech
Notes.
ARTICLE 10
SATISFACTION AND DISCHARGE
OF INDENTURE; UNCLAIMED MONEYS
SECTION 10.1 SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall cease to be of further effect as to all Outstanding Securities (except as
to (A) rights of registration of transfer and exchange, and the Issuer's right
of optional redemption, (B) substitution of apparently mutilated, defaced,
destroyed, lost or stolen Securities, (C) rights of Holders to receive payments
of principal thereof and interest thereon, (D) the rights, obligations and
immunities of the Trustee hereunder and (E) the rights of the Securityholders as
beneficiaries hereof with respect to the property so deposited with the Trustee
under the provisions of this Section 10.1) when (a) all Outstanding Securities,
except lost, stolen or destroyed Securities which shall have been replaced or
paid, as provided in Section 2.6, have been delivered to the Trustee for
cancellation or (b) the Issuer shall have paid or caused to be paid the
principal of and interest on the Securities Outstanding hereunder, as and when
the same shall have become due and payable, or (c) (i) the Securities not
theretofore delivered to the Trustee for cancellation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption under arrangements satisfactory to the Trustee upon
the giving of notice of redemption, and (ii) the Issuer shall have irrevocably
deposited or caused to be deposited with the Trustee, as trust funds, (A) money
in an amount or (B) Government Securities which through the payment of interest
and principal will provide, no later than one day before the due date of
payments in respect of the Securities, money in an amount or (C) a combination
thereof, any one of options (A), (B) or (C) being sufficient in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay the principal of
and interest on the Outstanding Securities to the date of maturity or
redemption, as the case may be. The Trustee, on demand of the Issuer
accompanied by an Officers' Certificate and an Opinion of Counsel and at the
cost and expense of the Issuer, shall execute proper instruments acknowledging
such satisfaction of and discharging this Indenture. The Issuer agrees to
reimburse the Trustee for any costs or expenses (including the reasonable fees
of its counsel) thereafter reasonably and properly incurred, to compensate the
Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Securities and to indemnify the
trust referred to in Section 10.2(a) for any tax liability and pay any expenses
of such trust not otherwise provided for pursuant to such Section.
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SECTION 10.2 DEFEASANCE AND DISCHARGE OF INDENTURE. The Issuer shall be
deemed to have paid and discharged the entire Indebtedness on all the
Outstanding Securities on the date of the deposit referred to in subparagraph
(a) hereof, and the provisions of this Indenture, as it relates to such
Outstanding Securities, shall no longer be in effect (and the Trustee, at the
expense of the Issuer, shall execute proper instruments acknowledging the same),
except as to: (1) rights of registration of transfer and exchange, and the
Issuer's right of optional redemption, (2) substitution of apparently mutilated,
defaced, destroyed, lost or stolen Securities, (3) rights of Holders to receive
payments of principal thereof and interest thereon, (4) the rights, obligations
and immunities of the Trustee hereunder and (5) the rights of the
Securityholders as beneficiaries hereof with respect to the property so
deposited with the Trustee payable to all or any of them; PROVIDED that all of
the following conditions shall have been satisfied:
(a) the Issuer has deposited or caused to be irrevocably
deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.9) as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of the Securities, (i) money in an amount or (ii) Government
Securities which through the payment of interest and principal in respect
thereof in accordance with their terms will provide not later than one
day before the due date of any payment referred to below money in an
amount, or (iii) a combination thereof, any one of options (i), (ii) or
(iii) being sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge without
consideration of the reinvestment of such interest and after payment of
all federal, state and local taxes or other charges and assessments in
respect thereof payable by the Trustee, the principal of and each
installment of principal and interest on the Outstanding Securities as of
the maturity date of such principal or installment of interest;
(b) such deposit shall not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Issuer is a party or by which it is bound;
(c) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit;
(d) the Issuer has delivered to the Trustee an Opinion of Counsel
to the effect that (i) the Holders of the Securities shall not recognize
income, gain or loss for Federal income tax purposes as a result of such
deposits, defeasance and discharge and will be subject to Federal income
tax on the same amount and in the same manner and at the same times as
would have been the case if such deposit, defeasance and discharge had
not occurred, (ii) the creation of the trust will not violate the
Investment Company Act of 1940, as amended, and (iii) Holders of the
Securities will have a valid, first priority lien on the trust funds; and
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(e) the Issuer has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to the defeasance contemplated by this
provision have been complied with.
SECTION 10.3 DEFEASANCE OF CERTAIN OBLIGATIONS. The Issuer may omit to
comply with any term, provision or condition set forth in Sections 3.5 to3.19
inclusive, and will not be subject to the Events of Default described under
clauses (d), (e) and (f) of Section 5.1 hereof, with respect to the Securities,
if all of the following conditions have been satisfied:
(a) the Issuer has deposited or caused to be irrevocably
deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.9) as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of the Securities, (i) money in an amount, or (ii) Government
Securities which through the payment of interest and principal in respect
thereof in accordance with their terms will provide not later than one
day before the due date of any payment referred to below money in an
amount, or (iii) a combination thereof, any one of options (i), (ii) or
(iii) being sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge without
consideration of the reinvestment of such interest and after payment of
all federal, state and local taxes or other charges and assessments in
respect thereof payable by the Trustee, the principal of and each
installment of principal and interest on the Outstanding Securities on
the maturity date of such principal or installment of principal or
interest;
(b) such deposit shall not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Issuer is a party or by which it is bound;
(c) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit;
(d) the Issuer has delivered to the Trustee an Opinion of Counsel
to the effect that (i) the Holders of the Securities shall not recognize
income, gain or loss for Federal income tax purposes as a result of such
deposit and defeasance of certain obligations and will be subject to
Federal income tax on the same amount and in the same manner and at the
same times as would have been the case if such deposit and defeasance had
not occurred, (ii) the creation of the trust will not violate the
Investment Company Act of 1940, as amended, and (iii) Holders of the
Securities will have a valid, first-priority lien on the trust funds; and
(e) the Issuer 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 defeasance contemplated by
this Section 10.3 have been complied with.
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SECTION 10.4 APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT OF
SECURITIES. Subject to Section 10.6, all moneys and Governmental Securities
deposited with the Trustee pursuant to Sections 10.1, 10.2 and 10.3 shall be
held in trust and applied by it to the payment, either directly or through any
paying agent (including the Issuer acting as paying agent), to the Holders of
the particular Securities for the payment or redemption of which such moneys
have been deposited with the Trustee, of all sums due and to become due thereon
for principal and interest; but such money and Government Securities need not be
segregated from other funds except to the extent required by law.
SECTION 10.5 REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection
with the satisfaction and discharge of this Indenture all moneys and Government
Securities then held by any paying agent under the provisions of this Indenture
shall, upon demand of the Issuer, be repaid to the Issuer or paid to the Trustee
and thereupon such paying agent shall be released from all further liability
with respect to such moneys and Government Securities.
SECTION 10.6 RETURN OF MONEYS HELD BY TRUSTEE AND PAYING AGENT UNCLAIMED
FOR ONE YEAR. Any moneys and Government Securities deposited with or paid to
the Trustee or any paying agent for the payment of the principal of or interest
on any Security and not applied but remaining unclaimed for one year after the
date upon which such principal or interest shall have become due and payable
shall, upon the written request of the Issuer and unless otherwise required by
mandatory provisions of applicable escheat or abandoned or unclaimed property
law, be repaid to the Issuer by the Trustee or such paying agent, and the Holder
of such Security shall, unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property laws, thereafter look only
to the Issuer for any payment which such Holder may be entitled to collect, and
all liability of the Trustee or any paying agent with respect to such moneys and
Government Securities shall thereupon cease; PROVIDED, HOWEVER, that the Trustee
or such paying agent before being required to make any such repayments may, at
the expense of the Issuer, cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, the City of New York, 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 publication, any unclaimed
balance of such money then remaining will be repaid to the Issuer. In the event
any Securities are not presented for payment when due, either at maturity or at
the date fixed for redemption thereof or otherwise, if funds sufficient to pay
such Securities shall have been made available to the Trustee or Paying Agent
for the benefit of the Holders thereof, all liability of the Issuer to the
Holders for payment of such Securities shall terminate and be completely
discharged. The Trustee shall hold such segregated funds, without liability for
interest thereon, for the benefit of the Holders, who shall thereafter be
restricted exclusively to such funds for the satisfaction of any claim of
whatever nature on their part under this Indenture or relating to such
Securities.
SECTION 10.7 REINSTATEMENT. If the Trustee or paying agent is unable to
apply any moneys or Government Securities in accordance with this Article Ten by
reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority
Page 49
enjoining, restraining or otherwise prohibiting such application, the Issuer's
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to this Article Ten until
such time as the Trustee or paying agent is permitted to apply all such moneys
or Government Securities in accordance with this Article; PROVIDED, HOWEVER,
that if the Issuer has made any payment of principal of or interest on any
Securities because of the reinstatement of its obligations, the Issuer shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the moneys or Government Securities held by the Trustee or paying
agent.
ARTICLE 11
MISCELLANEOUS PROVISIONS
SECTION 11.1 INCORPORATORS, SHAREHOLDERS, OFFICERS AND DIRECTORS OF
ISSUER EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such, or against any past, present or future stockholder,
officer, employee, director, or creditor, as such, of the Issuer or the Trustee
or any subsidiary of the Issuer or any successor of the Issuer or the Trustee or
any such subsidiary, whether directly or through the Issuer or any subsidiary of
the Issuer or any successor of the Issuer or any such subsidiary, under any rule
of law, statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the
Securities by the Holders thereof and as part of the consideration for the issue
of the Securities.
SECTION 11.2 PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES AND
SECURITYHOLDERS. Nothing in this Indenture or in the Securities, express or
implied, shall give or be construed to give to any Person, firm or corporation,
other than the parties hereto and their successors and the Holders of the
Securities, any legal or equitable right, remedy or claim under this Indenture
or under any covenant or provision herein contained, other than the rights
expressly granted to the holders of the Czech Notes.
SECTION 11.3 SUCCESSORS AND ASSIGNS OF ISSUER BOUND BY INDENTURE. All
the covenants, stipulations, promises and agreements in this Indenture contained
by or on behalf of the Issuer shall bind its successors and assigns, whether so
expressed or not.
SECTION 11.4 NOTICES AND DEMANDS ON ISSUER, TRUSTEE AND SECURITYHOLDERS.
Any notice or demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the Holders of Securities
to or on the Issuer shall be given or served by (i) delivery in Person, (ii)
telecopy (confirmed by copy sent by first-class mail) or (iii) certified or
registered mail, return receipt requested (except as otherwise specifically
provided herein), in each case addressed (until another address of the
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Issuer is filed by the Issuer with the Trustee) to Trans World Gaming Corp., Xxx
Xxxx Xxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000, Attention: President (Telecopy No.:
(000) 000-0000). Any notice, direction, request or demand by the Issuer or any
Securityholder to or upon the Trustee shall be deemed to have been sufficiently
given or made, for all purposes, if given or served by one of the methods
described in the first sentence of this Section 11.4, addressed to the Corporate
Trust Office (Telecopy No.: 212-754-1303).
Where this Indenture provides for notice to Holders, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to each Holder entitled thereto, at his
last address as it appears in the Security register. Any notice which is
delivered, telecopied (and confirmed by mail) or mailed in the manner herein
provided shall be conclusively presumed to have been given, whether or not the
addressee receives such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular mail
service, it shall be impracticable to mail notice or confirm by mail telecopy
notice to the Issuer and Securityholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice.
SECTION 11.5 COMPLIANCE CERTIFICATES AND OPINIONS OF COUNSEL; STATEMENTS
TO BE CONTAINED THEREIN. Upon an application or demand by the Issuer to the
Trustee to take any action under any of the provisions of this Indenture, the
Issuer shall furnish to the Trustee (i) an Officers' Certificate stating that
all conditions precedent provided for in this Indenture relating to the proposed
action have been complied with and (ii) an Opinion of Counsel stating that in
the opinion of such counsel all such conditions precedent have been complied
with and (iii) if appropriate, an Accountants' Certificate stating that in the
opinion of such accountants all such conditions precedent have been complied
with, except that in the case of any such application or demand as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and delivered
to the Trustee with respect to compliance with a condition or covenant provided
for in this Indenture shall include (a) a statement that the Person making such
certificate or opinion has read such covenant or condition, (b) a brief
statement as to the nature and scope of the examination or investigation 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 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
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condition has been complied with and (d) a statement as to whether or not, in
the opinion of such Person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters and information which is in the possession of the Issuer,
upon the certificate, statement or opinion of or representations by an officer
or officers of the Issuer, unless such counsel knows that the certificate,
statement or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the Issuer or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public accountants
filed with the Trustee shall contain a statement that such firm is independent.
SECTION 11.6 PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If the
date of maturity of interest on or principal of the Securities or the date fixed
for redemption of any Security shall not be a Business Day, then payment of
interest or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date.
SECTION 11.7 [Reserved]
SECTION 11.8 NEW YORK LAW TO GOVERN. THIS INDENTURE AND EACH SECURITY
SHALL BE DEEMED TO BE A CONTRACT UNDER THE LAWS OF THE STATE OF NEW YORK, AND
FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS (OTHER THAN
CHOICE OF LAW RULES) OF SAID STATE. THE ISSUER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE
COURT SITTING IN NEW YORK CITY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE OR THE SECURITIES AND THE ISSUER HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
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DETERMINED IN ANY SUCH UNITED STATES FEDERAL OR NEW YORK STATE COURT. THE
ISSUER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH
ACTION OR PROCEEDINGS IN SUCH RESPECTIVE JURISDICTIONS. THE ISSUER IRREVOCABLY
CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING
BROUGHT IN ANY COURT IN OR OF THE STATE OF NEW YORK BY THE DELIVERY OF COPIES OF
SUCH PROCESS TO THE ISSUER, AT ITS ADDRESS SPECIFIED IN SECTION 11.4 HEREOF OR
BY CERTIFIED MAIL DIRECT TO SUCH ADDRESS.
WHENEVER POSSIBLE EACH PROVISION OF THIS INDENTURE SHALL BE INTERPRETED
IN SUCH MANNER AS TO BE EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY
PROVISION OF THIS INDENTURE SHALL BE PROHIBITED BY OR INVALID UNDER APPLICABLE
LAW, SUCH PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR
INVALIDITY, WITHOUT INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE
REMAINING PROVISIONS OF THIS INDENTURE. WHENEVER IN THIS INDENTURE REFERENCE IS
MADE TO THE ISSUER OR A HOLDER, SUCH REFERENCE SHALL BE DEEMED TO INCLUDE, AS
APPLICABLE, A REFERENCE TO THEIR RESPECTIVE SUCCESSORS AND ASSIGNS. THE
PROVISIONS OF THIS INDENTURE SHALL BE BINDING UPON AND SHALL INURE TO THE
BENEFIT OF SUCH SUCCESSOR AND ASSIGNS. THE ISSUER'S SUCCESSORS AND ASSIGNS
SHALL INCLUDE, WITHOUT LIMITATION, A RECEIVER, TRUSTEE OR DEBTOR IN POSSESSION
FOR THE ISSUER.
SECTION 11.9 COUNTERPARTS. This Indenture may be executed in any number
of counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
SECTION 11.10 EFFECT OF HEADINGS. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
SECTION 11.11 DIRECTORS. Subject to the laws of the State of Nevada and
the Articles of Incorporation and By-Laws of TWG (which TWG shall use its best
efforts to amend to comply with this section), the Holder or Holders of 50
percent of the Outstanding Securities shall have the right to name, at any time,
and from time to time, two of seven members of the Board of Directors of TWG
until such time as the Securities are paid in full or fully defeased pursuant to
Article 10. Such named persons shall, upon direction by the required Holder(s),
be placed upon the Board of Directors and, TWG, at such time as such Board seat
of such appointee is subject to a shareholder vote, shall support and nominate
such named individuals for election to the Board. Such right to name such two
directors shall include, upon a one day written notice, the right to remove and
replace either or both such named directors. During such time period as
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this right exists, TWG will not permit its Board of Directors to exceeds a total
of seven (7) directors.
SECTION 11.12 WAIVER OF USURIOUS INTEREST. All agreements between
Issuer and Holders, whether now existing or hereafter arising and whether
written or oral, are hereby limited so that in no contingency, whether by reason
of demand or acceleration of the final maturity date of the Securities or
otherwise, shall the interest contracted for, charged, received, paid or agreed
to be paid to Holders exceed the maximum amount permissible under the laws of
the State of New York (hereinafter the "Applicable Law"). If, from any
circumstance whatsoever, interest would otherwise be payable to the Holders in
excess of the maximum amount permissible under Applicable Law, the interest
payable to the Holders shall be reduced to the maximum amount permissible under
Applicable Law, and if from any circumstance the Holders shall ever receive
anything of value deemed interest by the Applicable Law in excess of the maximum
amount permissible under the Applicable Law, an amount equal to the excessive
interest shall be applied to the reduction of the principal hereof and not to
the payment of interest, or if such excessive amount of interest exceeds the
unpaid principal balance of principal hereof, such excess shall be refunded to
Issuer. All interest paid or agreed to be paid to the Holders shall, to the
extent permitted by the Applicable Law, be amortized, prorated, allocated and
spread throughout the full period (including any renewal or extension) until
payment in full of the principal so that the interest hereon for such full
period shall not exceed the maximum amount permissible under the Applicable Law.
The Holders expressly disavow any intent to contract for, charge or receive
interest in an amount which exceeds the maximum amount permissible under the
Applicable Law. This paragraph shall control agreements between the Issuer and
the Holders.
ARTICLE 12
REDEMPTION OF SECURITIES
SECTION 12.1 RIGHT OF OPTIONAL REDEMPTION; PRICES. Subject to the terms
and conditions of this Indenture, the Securities shall be subject to redemption
prior the Maturity Date in whole or in part, at the election of the Issuer on
any date for which notice of redemption can be given, at the redemption price of
the principal amount of the Securities to be redeemed together with accrued
interest to the redemption date. To make this election the Issuer shall give
the Trustee at least 60 notice of such election, which notice shall specify the
principal amount of Securities to be redeemed and the date it has fixed for
redemption.
SECTION 12.2 NOTICE OF REDEMPTION. Notice of redemption to the Holders
of Securities to be redeemed as a whole shall be given by mailing notice of such
redemption by first-class mail, postage prepaid, at least 30 and not more than
60 days prior to the date fixed for redemption to such Holders of Securities at
their last addresses as they shall appear upon the registry books. Any notice
which is mailed in the manner herein provided shall be conclusively presumed to
have been duly given, whether or not the Holder receives the notice. Failure to
give notice by mail, or any defect in the notice to the Holder of any Security
designated for
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redemption as a whole or in part, shall not affect the validity of the
proceedings for the redemption of any other Security.
The notice of redemption to each such Holder shall specify the principal
amount of each Security held by such Holder to be redeemed, the date fixed for
redemption, the redemption price, the place or places of payment, that payment
will be made upon presentation and surrender of such Securities, that interest
accrued to the date fixed for redemption to the extent provided in
Section 12.1 will be paid as specified in said notice, that on and after said
date interest thereon will cease to accrue.
The notice of redemption of Securities to be redeemed shall be given by
the Issuer or, at the Issuer's request, by the Trustee in the name and at the
expense of the Issuer.
At least one Business Day prior to the redemption date specified in the
notice of redemption given as provided in this Section 12.2, the Issuer will
deposit with the Trustee or with one or more paying agents (or, if the Issuer is
acting as paying agent, set aside, segregate and hold in trust as provided in
Section 3.4) in immediately available funds an amount of money sufficient to
redeem in immediately available funds on the redemption date all the Securities
so called for redemption at the appropriate redemption price, together with
accrued interest to the date fixed for redemption to the extent provided in
Section 12.1.
SECTION 12.3 PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If notice of
redemption has been given as above provided, the Securities shall become due and
payable on the date and at the place stated in such notice at the applicable
redemption price, together with interest accrued to the date fixed for
redemption, and on and after said date (unless the Issuer shall default in the
payment of such Securities at the redemption price, together with interest
accrued to said date to the extent provided in Section 12.1) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue and, except as provided in Sections 6.5 and 10.6, such Securities shall
cease from and after the date fixed for redemption to be entitled to any benefit
or security under this Indenture, and the Holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to the date fixed for redemption to the extent
provided in Section 12.1. On presentation and surrender of such Securities at a
place of payment specified in said notice, said Securities shall be paid and
redeemed by the Issuer at the applicable redemption price, together with
interest accrued thereon to the date fixed for redemption. If any Security
called for redemption shall not be so paid upon surrender thereof for
redemption, the principal shall, until paid or duly provided for, bear interest
from the date fixed for redemption at the Default Rate.
SECTION 12.4 EXCLUSION OF CERTAIN SECURITIES FROM ELIGIBILITY FOR
SELECTION FOR REDEMPTION. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number in an Officer's Certificate and delivered to the Trustee at least 40 days
prior to the last date on which notice of redemption may be given as being owned
of record and beneficially by, and not pledged or hypothecated by, (a) the
Issuer or (b) an entity specifically identified in such written statement as
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directly or indirectly controlling or controlled by or under direct or indirect
common control with the Issuer (other than a holder of the Securities on the
Issue Date.
SECTION 12.5 SELECTION OF SECURITIES TO BE REDEEMED. If less than all
the Securities are to be redeemed, the particular Securities or portions of
Securities to be redeemed in minimum amounts $ 100.00 shall be selected in such
manner as the Trustee in its discretion may deem fair and appropriate so that
Securities are redeemed, as nearly as practicable, from each Holder on a
reasonably pro rata basis according to the principal amount of Securities
represented by each Security Outstanding.
SECTION 12.6 PARTIAL REDEMPTION OF SECURITIES. In case part but not all
of an Outstanding Security shall be selected for redemption, upon presentation
and surrender of such Security by the Holder thereof or his attorney duly
authorized in writing (with due endorsement by, or a written instrument of
transfer in form satisfactory to the Trustee) the Trustee shall authenticate and
deliver to or upon the order of such Holder, without charge therefor, for the
unredeemed portion of the principal amount of the Security so surrendered, a
Security or Securities, at the option of such Holder of like tenor. Fully
registered Securities so presented and surrendered shall be canceled in
accordance with this Indenture.
ARTICLE 13
WARRANT
The conversion feature of the Original Indenture is deleted as a
provision of this Indenture. Each Securityholder shall receive a Warrant to
purchase Common Stock of TWG in the form attached to that certain Consent to
Amend Indenture, Bonds and Warrants, by and between the Issuer, the Trustee and
the Holders as of the date hereof. Such Warrants shall permit the holder
thereof to purchase one share of common stock for each $1.50 of principal owed
to such Securityholder by the Issuer as of the date of this Indenture on the
terms and conditions set forth herein and in such Warrant. The number of shares
purchasable by the Warrant issued shall not be reduced by any subsequent
reduction in principal amount of such holder's Security. Subject to applicable
law, the Warrant is transferable and need not be exercised by a Securityholder.
Should a Securityholder desire to exercise the Warrant in whole or in part, such
Securityholder shall be permitted to, but shall not be required to, pay the
purchase price of the Common Stock acquired by such exercise by a corresponding
reduction in principal and interest owed such Securityholder pursuant to such
Securityholder's Security. The Warrants shall expire December 31, 2005. No
amendment to this Article 13 shall be binding upon a Holder absent that,
Holder's written consent, not withstanding any other provision of this
Indenture.
ARTICLE 14
SECURITY
SECTION 14.1 PLEDGE AND SECURITY INTEREST. "Collateral" means all
Property, including, without limitation, fee and leasehold interests in real
property and all
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personal property of the Issuer in the State of Louisiana, provided, however,
the Securities shall not be secured by, and the holders of the Securities have
no rights relating to, the Capital Stock (including direct and indirect,
partially and wholly-owned Subsidiaries) or assets of either TWG International
or TWG Finance, or of any of their respective Subsidiaries until the Czech Notes
are fully defeased, fully redeemed or paid in full. Pursuant to the terms of
the collateral agreements as executed pursuant to the Original Indenture, the
Issuer has granted to the Trustee Liens on the Collateral for the benefit of
holders of the Securities. This Indenture and the Securities issued pursuant to
this Indenture affirm, reinstate, restate, renew, replace and amend the Original
Indenture and the Securities issued thereunder and continues the Security
Interest of the Trustee for the benefit of the Holders of the Securities as
granted in the Original Indenture and related documents as to such real and
personal Property in the state of Louisiana, and any Security Interest beyond
the scope granted herein shall be deemed terminated. All references herein to
the "Security Interest" and to the "Lien of this Indenture" shall be deemed to
mean and refer to the Liens granted to the Trustee in the Original Indenture and
Collateral Agreements executed pursuant to the Original Indenture, as affirmed,
reinstated, restated, renewed, replaced and amended herein and pursuant to the
terms of the Collateral Agreements.
SECTION 14.2 SECURITY FOR OBLIGATION. The Security Interest secures
among other things the payment and performance of all obligations of the Issuer
now or hereafter existing under the Securities, the Collateral Agreements or
this Indenture, including without limitation the prompt payment when due
(whether by acceleration or otherwise) of the principal of or interest on the
Securities as such documents renew, affirm, reinstate, restate, replace and
amend the security interest granted the Securityholders in the Security arising
pursuant to the Original Indenture, and the collateral documents associated with
such Original Indenture (all such obligations of the Issuer being herein called
the "Obligations").
SECTION 14.3 PERFECTION OF SECURITY INTEREST.
The Issuer shall cause this Indenture, the Collateral Agreements,
financing statements, continuation statements, notifications of secured
transactions and other instruments with respect to the Collateral to be
promptly executed, recorded, registered and filed and to be kept
recorded, registered and filed in such manner and in such places as may
be required by law, and take all such other actions as may be required,
in order to make effective the Security Interest in all personal property
constituting part of the Collateral as a perfected security interest and
in all real property constituting part of the Collateral as a mortgage
lien effective as to third parties, and shall pay all taxes and fees
incidental thereto.
SECTION 14.4 NO DISPOSITION OF COLLATERAL; RELEASE OF LIEN OF INDENTURE.
The Issuer may not sell or otherwise dispose of Collateral, except as provided
in Section 3.13.
SECTION 14.5 OTHER LIENS. The Issuer will not create or permit to exist
any Lien upon or with respect to any of the Collateral, except for any Liens
permitted by the terms hereof or of the Collateral Agreements.
Page 57
SECTION 14.6 TRUSTEE APPOINTED ATTORNEY-IN-FACT. Subject to its right
of indemnification, the Trustee shall take any action required or permitted to
be taken by the Trustee under the Collateral Agreements if directed in writing
to do so by the Holders of at least 50% in aggregate principal amount of the
Securities then Outstanding; provided, however, that no action shall be taken
which, in the Opinion of Counsel, impairs the enforceability, priority or
perfection of the Lien of this Indenture as to the Collateral then subject
thereto, unless directed by all Holders, except as provided in Section 3.13.
SECTION 14.7 RETURN OF COLLATERAL. Upon the payment in full of the
obligations or upon satisfaction and discharge of this Indenture in accordance
with Article 10 (and the Trustee receiving written confirmation thereof
satisfactory to the Trustee), the Trustee, subject to the terms of the
Collateral Agreements, shall forthwith take all necessary action to return any
Collateral in the Trustee's possession to the Issuer or its Subsidiaries, as the
case may be, and release the Liens thereon and Security Interests therein.
SECTION 14.8 DEFAULT REMEDIES. The Trustee shall have the rights set
forth in the Collateral Agreements to exercise the remedies to realize upon the
collateral set forth in the Collateral Agreements.
SECTION 14.9 PROCEEDS. The proceeds of any sale or other disposition of
the Collateral received by the Trustee pursuant to the terms of the Collateral
Agreements shall be applied by the Trustee:
First: to the payment of the costs and expenses of such sale,
including a reasonable compensation to the Trustee, and its agents,
attorneys and counsel, and of all charges, expenses, liabilities and
advances incurred or made by the Trustee under this Indenture;
Second: to the reimbursement of the Trustee for any sum advanced
by the Trustee to the Issuer in order to preserve the Collateral together
with interest at the rate charged publicly announced by Citibank, N.A.
from time to time in New York, New York as its reference rate; and
Third: as provided in Section 5.3.
SECTION 14.10 DEFICIENCY. The Issuer shall remain liable for any
unfulfilled obligations, together with interest thereon, in accordance with and
subject to the provisions of the Securities and this Indenture.
SECTION 14.11 TRUSTEE'S DUTIES. The powers conferred upon the Trustee
by this Article 14 are solely to protect its interest and the interest of the
Holders in the Collateral and shall not impose any duty upon the Trustee to
exercise any such powers except as expressly provided in this Indenture or in
the Collateral Agreements. The Trustee shall be under no duty to the Issuer
whatsoever to make or give any presentment, demand for performance, notice of
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nonperformance, protest, notice of protest, notice of dishonor, or other notice
or demand in connection with any Collateral or the Obligations, or to take any
steps necessary to preserve any rights against prior parties except as expressly
provided in this Indenture or in the Collateral Agreements. The Trustee shall
not be liable to the Issuer for failure to collect or realize upon any or all of
the obligations or Collateral, or for any delay in so doing, nor shall the
Trustee be under any duty to the Issuer to take any action whatsoever with
regard thereto. The Trustee shall have no duty to the Issuer to comply with any
recording, filing, or other legal requirements necessary to establish or
maintain the validity, priority or enforceability of, or the Trustee's rights in
or to, any of the Collateral.
SECTION 14.12 SPECIAL TRUSTEE POWERS DUE TO ENVIRONMENTAL CONDITIONS.
The Trustee shall have the power to settle or compromise at any time any and all
claims against the Trust Estate or the Trustee (either in its corporate
capacity, or in the personal capacity of the individuals serving as trust
officers on behalf of the Trustee), which may be asserted by any governmental
body or private party involving the alleged violation of any applicable
Environmental Laws affecting the Collateral or any other property held in trust
with respect to or in connection with the Collateral. Notwithstanding any
provision in this subparagraph to the contrary, the Trustee may not settle or
compromise any claim against the Trust Estate or the Trustee which may result in
any liability being asserted against Issuer without Issuer having had a
reasonable opportunity to resolve the alleged violation, which reasonable
opportunity shall not exceed 60 days from the date on which Issuer shall have
been notified of such alleged violation by a governmental body or a private
party; provided, however, in the event that Issuer shall be in default under the
Indenture or under the Collateral Agreements, then it shall have none of the
rights afforded to it in this paragraph.
The Trustee shall not be personally liable to the Holders or any other
Person for any decrease in value of the Collateral by reason of the Trustee's
compliance with any Applicable Environmental Laws (as defined in the Collateral
Agreements), specifically including any reporting requirement under such law.
Neither the acceptance by the Trustee of property nor failure by the Trustee to
inspect property shall be deemed to create any interference as to whether or not
there is or may be any liability under any applicable Environmental Laws with
respect to such property.
Notwithstanding anything in this Indenture or the Collateral Agreements
to the contrary, the Trustee shall not be required to initiate foreclosure
proceedings with respect to the Collateral, and shall not otherwise be required
to acquire possession of, or take other action with respect to the Collateral
which could cause the Trustee to be considered an "owner" or "operator" within
the meaning of the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended from time to time, or any other law dealing
with the environmental matters or hazardous substances, unless the Trustee has
sufficient comfort, based on previous determinations by experts on which it can
rely, including environmental report, that:
(a) there are no circumstances present at the Collateral relating
to the use, management or disposal of any hazardous substances, hazardous
materials, hazardous wastes or petroleum-based materials for which
investigation, testing, monitoring,
Page 59
contaminant, clean up or remedial action could be required under any
environmental laws, or that if any such materials are present for which
such action could be required, that it would be nevertheless in the best
economic interest of the Trustee and the Holders to take such actions
with respect to the Collateral;
(b) if the Trustee has determined that it would be in the best
economic interest of the Trustee and the Holders, the Trustee must be
satisfied that they will suffer no unreimbursed liabilities and will be
adequately reimbursed for all liabilities, expenses and costs from
available funds in Trustee's possession and control; and
(c) if the Trustee has determined that it would be in the best
economic interest of the Trustee and the Holders to take any such action
and its aforementioned liabilities, expenses and costs are adequately
reimbursed, the Trustee has so notified the Holders and has not received,
within 30 days of such notification, instructions from owners of fifty
percent (50%) or more in principal amount of the then Outstanding
Securities directing it not to take such action.
If the foregoing conditions are not satisfied and the Trustee is not willing to
waive such conditions and initiate foreclosure proceedings, then the Trustee
shall take such actions as are reasonably necessary or appropriate in order to
facilitate the appointment of a co-trustee, being a person or entity designated
by the Holders of a majority in principal amount of the Securities then
Outstanding and to assign to such person or entity (subject, however, to the
trusts created pursuant to the Indenture) the beneficial interest under the
Collateral Agreements which secures the obligations under the Indenture, for the
limited purpose of conducting a foreclosure of such Collateral Agreements and
receiving and holding any title to real property obtained as a result of such
foreclosure. Persons or entities appointed as co-trustees or agents of the
Trustee pursuant to this Section shall not be required to meet the criteria of
Section 6.9 of this Indenture, or any other criteria, in order to serve as such.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and, where appropriate, their respective corporate seals to be
hereunto affixed and attested, all as of March 31, 1996.
[CORPORATE SEAL] TRANS WORLD GAMING CORP.
Attest: By: _______________________________________
By: _________________________ By: _______________________________________
[CORPORATE SEAL] TRANS WORLD GAMING OF LOUISIANA, INC.
Attest: By: _______________________________________
By: _________________________ By: _______________________________________
U.S. TRUST COMPANY OF TEXAS, N.A., as Trustee
By: __________________________________
__________________________________
(Name and Title)
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