ELSINORE CORPORATION,
Issuer
and
THE GUARANTORS NAMED HEREIN
and
FIRST TRUST NATIONAL ASSOCIATION
Trustee
-----------------------
AMENDED AND RESTATED
INDENTURE
Dated as of March 3, 1997
-----------------------
$30,000,000
13 1/2% Second Mortgage Notes due 2001
2.AMENDED AND RESTATED INDENTURE, dated as of March 3, 1997,
between ELSINORE CORPORATION, a Nevada corporation (the "Company"), the
GUARANTORS referred to below and FIRST TRUST NATIONAL ASSOCIATION, a national
association, as Trustee (individually a "Party" and collectively the "Parties").
Factual Background
A. The Parties entered into that certain Indenture dated as of October
8, 1993 as amended by Supplemental Indenture No. 1 dated as of April 21, 1994
and Supplemental Indenture No. 2 dated as of December 14, 1994 (the "Original
Indenture") pursuant to which the Company issued the Original Notes (as defined
below) in the aggregate principal amount of $60,000,000. The Original Notes bore
interest at 12 1/2% with a stated maturity date of October 1, 2000.
B. On or about October 14, 1994, the Company entered into a certain
Note and Stock Purchase Agreement with the Senior Noteholders (as defined below)
whereby the Company issued the Senior Notes (as defined below). The Senior Notes
were issued pursuant to a Waiver of Compliance dated as of October 13, 1994,
executed by Trustee, the Company, and the Guarantors. The Senior Notes are
secured by senior security interests in the Collateral (as defined below).
C. On October 31, 1995, the Company filed a Chapter 11 bankruptcy
reorganization case in the United States Bankruptcy Court for the District of
Nevada (the "Court"), Case No. 95-24685 RCJ. On August 9, 1996, the Court
entered its Order Confirming Chapter 11 Plan of Reorganization (the "Order")
confirming the Plan of Reorganization (the "Plan") identified in the Order,
which became final on August 20, 1996 (the "Confirmation Date").
D. This Amended and Restated Indenture is entered into by the Parties
pursuant to the Order and the Plan, and is effective subject to the terms and
conditions of the Order and the Plan, as provided in the Order and the Plan.
E. The Parties desire to amend and restate the Indenture to provide,
among other things, for the issuance of Amended and Restated Notes in the
aggregate principal amount of $30,000,000. The Amended and Restated Notes will
bear interest at 13 1/2% from August 20, 1996 and will mature on August 20,
2001. Each of the Original Notes shall be exchanged for an Amended and Restated
Note in a principal amount equal to one-half of the principal amount of the
Original Note.
NOW, THEREFORE, the parties do hereby amend and restate the Original
Indenture to read in full as follows, effective on the Effective Date (as
defined in the Order) and upon satisfaction of the conditions stated in Exhibit
A to this Amended and Restated Indenture:
Each Party hereto agrees as follows for the benefit of each other Party
and for the equal and ratable benefit of the Holders of the Company's Amended
and Restated Notes (as defined below):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.
"Acceleration Notice" shall have the meaning specified in Section 7.2.
"Acquired Indebtedness" means Indebtedness of any person existing at
the time such person becomes a Subsidiary of the Company or is merged or
consolidated into or with the Company or a Subsidiary of the Company, and not
incurred in connection with or in anticipation of, such merger or consolidation
or such person becoming a Subsidiary of the Company.
"Acquisitions" means the purchase or other acquisition of any person or
substantially all the assets of any person by any other person, whether by
purchase, merger, consolidation, or other transfer, and whether or not for
consideration.
"Affiliate" means (i) any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
of its Subsidiaries, (ii) any spouse, immediate family member, or other relative
who has the same principal residence of any Person described in clause (i)
above, (iii) any trust in which any Person described in clause (i) or (ii) above
has a beneficial interest, and (iv) any Person which has entered into a
management contract with the Company or any of its Subsidiaries, and any
Affiliate of such Person. For purposes of this definition, the term "control"
means (a) the power to direct the management and policies of a Person, directly
or through one or more intermediaries, whether through the ownership of voting
securities, by contract, or otherwise, or (b) the beneficial ownership of 10% or
more of any class of voting Capital Stock of a Person (on a fully diluted basis)
or of warrants or other rights to acquire 10% or more of such class of Capital
Stock (whether or not presently exercisable).
"Affiliate Transaction" shall have the meaning specified in Section 5.10
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Amended and Restated Notes" means the Amended and Restated Notes
issued pursuant to this Indenture.
"Approvals" means all approvals, licenses (including Gaming Licenses),
permits, authorizations, findings and other filings necessary under applicable
Gaming Laws.
"Asset Sale" shall have the meaning specified in Section 5.14.
"Average Life" means, as of the date of determination, with respect to
any security or instrument, the quotient obtained by dividing (i) the sum of the
products of the number of years from the date of determination to the dates of
each successive scheduled principal (or redemption) payment of such security or
instrument multiplied by the amount of such principal (or redemption) payment by
(ii) the sum of all such principal (or redemption) payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any person, the Board of
Directors of such person or any committee of the Board of Directors of such
person authorized, with respect to any particular matter, to exercise the power
of the Board of Directors of such person.
"Board Resolution" means, with respect to any person, a duly adopted
resolution of the Board of Directors of such person.
"Business Day" means a day that is not a Legal Holiday.
"Capital Stock" means, with respect to any person, any common stock,
preferred stock and any other capital stock of such person and shares,
interests, participations or other ownership interests (however designated), of
any person and any rights (other than debt securities convertible into corporate
stock), warrants or options to purchase any of the foregoing.
"Capitalized Lease Obligation" means obligations under a lease, entered
into on or after the Effective Date, that are required to be capitalized for
financial reporting purposes in accordance with GAAP, and the amount of
Indebtedness represented by such obligations shall be the capitalized amount of
such obligations, as determined in accordance with GAAP.
"Cases" means the following Chapter 11 bankruptcy cases in the Court, and
all petitions, consents, decrees, judgments, orders, documents, and pleadings
filed with or by the Court therein: No. 95-24685 RCJ, No. 95-24686 RCJ, No.
95-24687 RCJ, No. 95-24688 RCJ, No. 95-24689 RCJ, and No. 95-24839 RCJ.
"Cash" means U.S. Legal Tender or U.S. Government obligations.
"Cash Equivalent" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit and commercial paper issued by the parent corporation of
any domestic commercial bank of recognized standing having capital and surplus
in excess of $500,000,000 and commercial paper issued by others rated at least
A-2 or the equivalent thereof by Standard & Poor's Corporation or at least P-2
or the equivalent thereof by Xxxxx'x Investors Service, Inc. and in each case
maturing within one year after the date of acquisition and (iii) investments in
money market funds substantially all of whose assets comprise securities of the
types described in clauses (i) and (ii) above.
"Casino" means a gaming establishment owned by the Company or one of
its Subsidiaries.
"Change of Control" means (i) the time that the Company first
determines or reasonably should have known that any "person" or "group" (as such
terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act,
whether or not applicable), is or becomes the "beneficial owner" (as such term
is used in Rules 13d-3 and 13d-5 under the Exchange Act, whether or not
applicable, except that a "person" shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 50% of the total voting power in the
aggregate of all classes of Capital Stock then outstanding of the Company
normally entitled to vote in elections of directors, or (ii) during any period
of 12 consecutive months after the Effective Date, individuals who at the
beginning of such period constituted the Board of Directors of the Company
(together with any new directors whose election by such Board or whose
nomination for election by the shareholders of the Company was approved by a
vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved), cease for any reason to constitute a
majority of the Board of Directors of the Company then in office.
"Change of Control Offer" shall have the meaning specified in
Section 12.1.
"Change of Control Payment Date" shall have the meaning specified in
Section 12.1.
"Change of Control Purchase Price" shall have the meaning specified in
Section 12.1.
"Change of Control Put Date" shall have the meaning specified in
Section 12.1.
"Collateral" means the Property of the Company and Property of the
Guarantors which is subject to the Liens created by the Mortgage.
"Common Stock" shall mean the Common Stock, par value $0.001 per share, of
the Company, now or hereafter issued.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to the Indenture and thereafter means such
successor.
"Company Request" means a written request of the Company or a
Guarantor, as the case may be, in the form of an Officers' Certificate.
"Consolidated Depreciation and Amortization" for any person means the
total depreciation and amortization for such person and its Consolidated
Subsidiaries, as determined in accordance with GAAP.
"Consolidated EBITDA" means, with respect to any person, for any
period, the Consolidated Net Income of such person for such period adjusted to
add thereto (to the extent deducted from net revenues in determining
Consolidated Net Income), without duplication, the sum of (i) Consolidated
Income Tax Expense, (ii) Consolidated Depreciation and Amortization expense and
(iii) Consolidated Fixed Charges.
"Consolidated Fixed Charges" of any person means, for any period, the
aggregate amount (without duplication) of (a) interest expensed or capitalized,
paid, accrued, or scheduled to be paid or accrued in accordance with GAAP
(including, in accordance with the following sentence, interest attributable to
Capitalized Lease Obligations) during such period in respect of all Indebtedness
of such person and its Consolidated Subsidiaries, including (i) original issue
discount and non-cash interest payments or accruals on any Indebtedness other
than with respect to the Notes, (ii) the interest portion of all deferred
payment obligations, calculated in accordance with GAAP, and (iii) all
commissions, discounts and other fees and charges owed with respect to bankers'
acceptance financings and currency and Interest Swap Obligations, in each case
to the extent attributable to such period and determined on a consolidated basis
in accordance with GAAP, and (b) the amount of dividends payable by such person
or any of its Consolidated Subsidiaries in respect of Disqualified Capital Stock
(other than by Subsidiaries of such person to such person or such person's
wholly owned Subsidiaries). For purposes of this definition, (x) interest on a
Capitalized Lease Obligation shall be deemed to accrue at an interest rate
reasonably determined by the Company to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP and (y) interest expense
attributable to any Indebtedness represented by the guaranty by such person or a
Subsidiary of such person of an obligation of another person shall be deemed to
be the interest expense attributable to the Indebtedness guaranteed.
"Consolidated Fixed Charges Coverage Ratio" of any person on any date
of determination (the "Transaction Date") means, the ratio of (a) the aggregate
amount of Consolidated EBITDA of such person attributable to continuing
operations and businesses (exclusive of amounts attributable to operations and
businesses discontinued or disposed of) for the Reference Period to (b) the
aggregate Consolidated Fixed Charges of such person (exclusive of amounts
attributable to discontinued operations and business, but only to the extent
that the obligations giving rise to such Consolidated Fixed Charges would no
longer be obligations contributing to such person's Consolidated Fixed Charges
subsequent to the Transaction Date) during the Reference Period; provided, that
for purposes of such calculation, (i) Acquisitions which occurred during the
Reference Period or subsequent to the Reference Period and on or prior to the
date of the transaction giving rise to the need to calculate the Consolidated
Fixed Charges Coverage Ratio shall be assumed to have occurred on the first day
of the Reference Period, (ii) transactions giving rise to the need to calculate
the Consolidated Fixed Charges Coverage Ratio shall be assumed to have occurred
on the first day of the Reference Period, (iii) the incurrence of any
Indebtedness or issuance of any Disqualified Capital Stock during the Reference
Period or subsequent to the Reference Period and on or prior to the Transaction
Date (and the application of the proceeds therefrom to the extent used to
refinance or retire other Indebtedness) shall be assumed to have occurred on the
first day of such Reference Period, and (iv) the Consolidated Fixed Charges of
such person attributable to interest on any Indebtedness or dividends on any
Disqualified Capital Stock bearing a floating interest (or dividend) rate shall
be computed on a pro forma basis as if the average rate in effect from the
beginning of the Reference Period to the Transaction Date had been the
applicable rate for the entire period, unless such Person or any of its
Subsidiaries is a party to an Interest Swap obligation (which shall remain in
effect for the 12 month period immediately following the Transaction Date) that
has the effect of fixing the interest rate on the date of computation, in which
case such rate (whether higher or lower) shall be used.
"Consolidated Income Tax Expense" for any person means the total net
income tax expenses for such person and its Consolidated Subsidiaries, as
determined in accordance with GAAP.
"Consolidated Net Income" means, with respect to any person for any
period, the net income (or loss) of such person and its Consolidated
Subsidiaries (determined in accordance with GAAP) for such period, adjusted to
exclude (only to the extent included in computing such net income (or loss) and
without duplication): (a) all gains which are either extraordinary (as
determined in accordance with GAAP) or are either unusual or nonrecurring, (b)
the net income, if positive, of any person, other than a Consolidated
Subsidiary, in which such person or any of its Consolidated Subsidiaries has an
interest, except to the extent of the amount of any dividends or distributions
actually paid in Cash to such person or a Consolidated Subsidiary of such person
during such period, but not in excess of such person's pro rata share of such
person's net income for such period, (c) the net income, if positive, of any
person acquired in a pooling of interests transaction for any period prior to
the date of such acquisition, and (d) the net income, if positive, of any of
such person's Consolidated Subsidiaries to the extent that the declaration or
payment of dividends or similar distributions is not at the time permitted by
operation of the terms of its charter or bylaws or any other agreement,
instrument, judgment, decree, order, law, statute, rule or governmental
regulation applicable to such Consolidated Subsidiary.
"Consolidated Net Worth" of any person at any date means the aggregate
of capital, surplus and retained earnings of such person (plus amounts of equity
attributable to preferred stock) and its Consolidated Subsidiaries, as would be
shown on the consolidated balance sheet of such person prepared in accordance
with GAAP, adjusted to exclude (to the extent included in calculating such
equity), (a) the amount of capital, surplus and accrued but unpaid dividends
attributable to any Disqualified Capital Stock, (b) all upward revaluations and
other write-ups in the book value of any asset of such person or a Consolidated
Subsidiary of such person subsequent to the Effective Date and (c) all
investments in Subsidiaries that are not Consolidated Subsidiaries and in
persons that are not Subsidiaries.
"Consolidated Subsidiary" means, for any person, each Subsidiary of
such person (whether now existing or hereafter created or acquired) the
financial statements of which shall be (or should have been) consolidated for
financial statement reporting purposes with the financial statements of such
person in accordance with GAAP.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Deed of Trust" means the Deed of Trust, Assignment of Rents and
Security Agreement dated as of October 8, 1993, by and among Four Queens, Inc.,
Land Title of Nevada, Inc., as trustee and the Trustee, as modified by
Modification of Subordinated Deed of Trust dated March 3, 1997.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Disqualified Capital Stock" means, with respect to any person, (a)
Capital Stock of such person that, by its terms or by the terms of any security
into which it is convertible or exchangeable, is, or upon the happening of an
event or the passage of time would be, required to be redeemed or repurchased
(including at the option of the holder thereof) by such person or any of its
Subsidiaries, in whole or in part, on or prior to the Stated Maturity of the
Notes and (b) with respect to any Subsidiary of such person, any Capital Stock
other than any common stock or other equity interest with no preference,
privileges, or redemption or repayment provisions.
"Effective Date" means the date identified as such in the Plan and Order
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"Event of Default" shall have the meaning specified in Section 7.01.
"Event of Loss" means, with respect to any property or asset, any (i)
loss, destruction or damage of such property or asset; (ii) any actual
condemnation, seizure or taking, by exercise of the power of eminent domain or
otherwise, of such property or asset, or confiscation or requisition of the use
of such property or asset.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"Facility Lease" is defined in the Deed of Trust.
"Facility Lessor" is defined in the Deed of Trust.
"Four Queens Casino" means the Four Queens Casino and Hotel and
properties and operations ancillary thereto located at 000 Xxxx Xxxxxxx Xxxxxx,
Xxx Xxxxx, Xxxxxx, owned and operated by Four Queens, Inc., a wholly owned
subsidiary of the Company.
"Fremont Street Experience" means an open air street mall on Fremont
Street in Las Vegas, Nevada.
"Fremont Street L.L.C." means any Person in which the Company has an
interest which manages or operates the Fremont Street Experience.
"GAAP" means generally accepted accounting principles as in effect in
the United States from time to time.
"Gaming Authority" means any governmental board, agency or authority
with the power to regulate gaming, including the Nevada State Gaming Control
Board and the Nevada Gaming Commission, and the corresponding governmental
authorities with responsibility to interpret and enforce the laws and
regulations applicable to gaming in any Gaming Jurisdiction.
"Gaming Jurisdiction" means the State of Nevada and any other Federal,
state or local jurisdiction in which any entity in which the Company has a
direct or indirect beneficial, legal or voting interest conducts casino gaming.
"Gaming Law" means any law, rule, regulation or ordinance governing
gaming activities, including the Nevada Gaming Control Act, any administrative
rules or regulations promulgated thereunder, and any of the corresponding
statutes and regulations in each Gaming Jurisdiction.
"Gaming Licenses" means every material license, material franchise or
other material approval or authorization on the date of the Indenture or
thereafter required to own, lease, operate or otherwise conduct gaming in the
State of Nevada or any other jurisdiction in which the Company conducts or
proposes in good faith to conduct material gaming business, and applicable
liquor licenses related to any such gaming business.
"Guarantors" means, collectively, the Subsidiaries of the Company and all
future Subsidiaries of the Company.
"Guaranty" shall have the meaning provided in Section 13.1(a).
"Holder" or "Securityholder" means the person in whose name a Security
is registered on the Registrar's books.
"incur" shall have the meaning specified in Section 5.11
"Incurrence Date" shall have the meaning specified in Section 5.11.
"Indebtedness" means, without duplication, (a) all liabilities and
obligations, contingent or otherwise, with respect to any person, (i) in respect
of borrowed money (whether or not the recourse of the lender is to the whole of
the assets of such person or only to a portion thereof), (ii) evidenced by
bonds, notes, debentures or similar instruments, (iii) representing the balance
deferred and unpaid of the purchase price of any property or services, (iv)
evidenced by bankers' acceptances or similar instruments issued or accepted by
banks, (v) for the payment of money relating to a Capitalized Lease Obligation,
or (vi) evidenced by a letter of credit or a reimbursement obligation of such
person with respect to any letter of credit; (b) all obligations of such person
under Interest Swap Obligations and foreign currency xxxxxx; (c) all liabilities
of others of the kind described in the preceding clauses (a) or (b) that such
person has guaranteed or that is otherwise its legal liability and all
obligations to purchase, redeem or acquire any Capital Stock; (d) all
obligations secured by a Lien, other than a Permitted Lien, not securing any
liability or obligation that would itself constitute Indebtedness, to which the
property or assets (including, without limitation, leasehold interests and any
other tangible or intangible property rights) of such person are subject,
whether or not the obligations secured thereby shall have been assumed by or
shall otherwise be such person's legal liability, provided, that the amount of
such obligations shall be limited to the lesser of the fair market value of the
assets or property to which such Lien attaches and the amount of the obligation
so secured; and (e) any and all deferrals, renewals, extensions, refinancings
and refundings (whether direct or indirect) of, or amendments, modifications or
supplements to, any liability of the kind described in any of the preceding
clauses (a), (b), (c) or (d), or this clause (e), whether or not between or
among the same parties.
"Indenture" means this Amended and Restated Indenture, as amended or
supplemented from time to time in accordance with the terms hereof.
"Indenture Obligations" means the obligations of the Company and the
Guarantors pursuant to this Indenture and the Securities (and any other obligor
hereunder or under the Securities) now or hereafter existing, to pay principal
of and premium, if any, and interest on the Securities when due and payable,
whether on the Maturity Date or an Interest Payment Date, by acceleration, call
for redemption, acceptance of any Change of Control Offer, or otherwise, and
interest on the overdue principal and premium, if any, of, and (to the extent
lawful) interest, if any, on, the Securities and all other amounts due or to
become due in connection with this Indenture, the Securities and the Mortgage,
including any and all extensions, renewals or other modifications thereof, in
whole or in part, and the performance of all other obligations of the Company
(and any other obligor hereunder or under the Securities) and the Guarantors,
including all costs and expenses incurred by the Trustee or the Holders in the
collection or enforcement of any such obligations or realization upon the
Collateral or the security of any Mortgage.
"Insurance Proceeds" means the Company's and the Guarantors' interest
in and to (a) all proceeds which now or hereafter may be paid under any
insurance policies now or hereafter obtained by or on behalf of the Company and
the Guarantors in connection with the conversion of the Property subject to the
Mortgage into Cash or liquidated claims, together with the interest payable
thereon and the right to collect and receive the same, including, but without
limiting the generality of the foregoing, proceeds of casualty insurance, title
insurance, business interruption insurance and any other insurance now or
hereafter maintained with respect to such Property and (b) all amounts
attributable to Events of Loss.
"Interest Payment Date" means the stated due date of an installment of
interest on the Securities.
"Interest Swap Obligation" means, when used with reference to any
person, the obligations of such person pursuant to any arrangement with any
other person whereby, directly or indirectly, such person is entitled to receive
from time to time periodic payments calculated by applying either a floating or
a fixed rate of interest on a stated notional amount in exchange for periodic
payments made by such person calculated by applying a fixed or a floating rate
of interest on the same notional amount.
"Investment" by a person in any other person means (without
duplication) (a) the acquisition by such person (whether for cash, property,
services, securities or otherwise) of capital stock, bonds, notes, debentures,
partnership or other ownership interests or other securities of such other
person or any agreement to make any such acquisition; (b) the making by such
person of any deposit with, or advance, loan or other extension of credit to,
such other person (including the purchase of property from another person
subject to an understanding or agreement, contingent or otherwise, to resell
such property to such other person) or any commitment to make any such advance,
loan or extension; (c) the entering into by such person of any guarantee of, or
other contingent obligation with respect to, Indebtedness or other liability of
such other person; (d) the making of any capital contribution by such person to
such other person or (e) the designation by the Board of Directors of a
subsidiary to be an Unrestricted Subsidiary in accordance with the definition of
"Unrestricted Subsidiary." For purposes of this definition, the definition of
"Unrestricted Subsidiary" and Section 15.3, an "Investment" shall include the
fair market value of the net assets at the time of such "Investment," as
determined in good faith by the Board of Directors.
"Legal Holiday" shall have the meaning provided in Section 14.7.
"Lien" means any mortgage, lien, pledge, charge, security interest, or
other encumbrance of any kind, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement and any lease deemed to constitute a security interest, and
any option or other agreement to give any security interest).
"Maturity Date," when used with respect to any Security, means the date
on which the principal of such Security becomes due and payable as therein or
herein provided, whether at Stated Maturity, Change of Control Payment Date, or
by declaration of acceleration, call for redemption or otherwise.
"Mortgage" means the Deed of Trust, the Pledge Agreement and any other
agreement purporting to convey to the Trustee for the benefit of Holders, a
security interest in Property pursuant to the requirements of this Indenture
executed by the Company and the Guarantors in favor of the Trustee for the
benefit of the Securityholders, as the same may be amended from time to time.
"Native American Casino" means a Casino which lawfully conducts gaming
pursuant to, and in accordance with the Indian Gaming Regulatory Act, 25 U.S.C.
ss. 2701 et seq., and the rules and regulations promulgated thereunder by the
National Indian Gaming Commission.
"Native American Casino Management Contract" means a contract to
operate and/or manage one or more Native American Casinos, or any Casino
operated on Native American land; provided that, (i) jurisdiction to rule on
disputes over such contract's terms is properly exercised by a state or federal
court in the United States and (ii) such contract by its terms is enforceable in
a state or federal court.
"Net Proceeds" means the aggregate Cash, Cash Equivalents, and fair
market value of property (valued at the fair market value thereof at the time of
receipt in good faith by the Board of Directors of the Company) other than
securities of the Company or any of its Subsidiaries, received by the Company,
after payment of expenses, commissions, discounts and the like incurred in
connection with the transaction giving rise to the Net Proceeds.
"Non-recourse Indebtedness" means Indebtedness of a person to the
extent that under the terms thereof or pursuant to applicable law no personal
recourse shall be had against such person for the payment of the principal of or
interest or premium on such Indebtedness or for any claim based on such
Indebtedness and enforcement of obligations on such Indebtedness is limited only
to recourse against interests in property and assets purchased with the proceeds
of the incurrence of such Indebtedness and as to which the Company provides no
credit support and is not directly or indirectly liable and a default with
respect to which would not entitle any party to cause any other Indebtedness to
be accelerated.
"Officer" means, with respect to the Company, the Chairman of the
Board, the President, any Vice President, the Chief Financial Officer, the
Treasurer, the Controller, or the Secretary or Assistant Secretary of the
Company.
"Officers' Certificate" means, with respect to the Company or any
Guarantor, a certificate signed by two Officers of the Company or such Guarantor
and otherwise complying with the requirements of Sections 14.4 and 14.5.
"Opinion of Counsel" means a written opinion from legal counsel to the
Trustee complying with the requirements of Sections 14.4 and 14.5. Unless
otherwise required by this Indenture, the counsel may be in-house counsel to the
Company.
"Original Indenture" means the Indenture by and among the Parties dated
October 8, 1993, prior to amendment and restatement in this Amended and Restated
Indenture.
"Original Notes" means the 12 1/2% First Mortgage Notes due 2000, that
were issued pursuant to the Original Indenture.
"Paying Agent" shall have the meaning specified in Section 2.4.
"Permitted Equity Proceeds Investments" means any Investment, solely of
the Net Proceeds received by the Company from the sale of its Qualified Capital
Stock, other than to any of its Subsidiaries, after the Effective Date, by the
Company in riverboat or dockside gaming or Casinos on Native American land,
pursuant to which Investment the Company, an Unrestricted Subsidiary, or a
Guarantor receives, in the case of a Casino on Native American land, a Native
American Casino Management Contract or, in the case of riverboat or dockside
gaming, constructs, owns or operates pursuant to a management contract a
dockside or riverboat Casino, provided that in any case, all of the rights and
interests in such Casino or contract held by the Company or any of its
Subsidiaries are pledged (except for Permitted Liens) on an exclusive basis as
Collateral for the Notes.
"Permitted FF&E Financing" means Indebtedness incurred to finance the
acquisition or lease of newly acquired or leased furniture, fixtures or
equipment ("FF&E") used directly in the operation of Casinos and secured by a
Lien on such FF&E.
"Permitted Liens" means any of the following:
(a) Liens arising by reason of any judgment, decree or order
of any court only to the extent, for an amount and for a period not resulting in
an Event of Default with respect thereto and so long as such Lien is being
contested in good faith and is adequately bonded, and any appropriate legal
proceeding which may have been duly initiated for the review of such judgment,
decree or order shall not have been finally permitted or the period within which
such proceedings may be initiated shall not have expired;
(b) Security for payment of worker's compensation or other
insurance;
(c) Security for the performance of bids, tenders, trade,
contracts (other than contracts for the payment of money) or leases, surety
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business or appeal bonds, and public and statutory bonds;
(d) Liens for taxes, assessments or other governmental charges
not yet due or which are being contested in good faith and by appropriate
proceedings by the Company or a Guarantor if adequate reserves with respect
thereto are maintained on the books of the Company or such Guarantor, as the
case may be, in accordance with GAAP;
(e) Liens of carriers, warehousemen, mechanics, landlords,
materialmen, repairmen or other like Liens arising by operation of law in the
ordinary course of business and consistent with industry practices and Liens on
deposits made to obtain the release of such Liens if (i) the underlying
obligations are not overdue for a period of more than 30 days or (ii) such Liens
are being contested in good faith and by appropriate proceedings by the Company
or a Guarantor and adequate reserves with respect thereto are maintained on the
books of the Company or such Guarantor, as the case may be, in accordance with
GAAP;
(f) Easements, rights-of-way, zoning and similar restrictions
and other similar encumbrances or title defects incurred in the ordinary course
of business and consistent with industry practices which, in the aggregate, are
not substantial in amount, and which do not in any case materially detract from
the value of the property subject thereto (as such property is used by the
Company or such Guarantor) or interfere with the ordinary conduct of the
business of the Company or such Guarantor or any of their Subsidiaries;
provided, that any such Liens are not incurred in connection with any borrowing
of money or any commitment to loan any money or to extend any credit;
(g) Liens securing any Permitted FF&E Financing, but
only on the FF&E acquired with the proceeds of such Permitted FF&E Financing;
(h) Liens securing the Notes; and
(i) Liens securing the Senior Notes.
"Person" means any individual, limited liability company, corporation,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
"Plans" means all drawings, plans and specifications prepared by or on
behalf of the Company or any of its Subsidiaries, as the same may be amended or
supplemented from time to time, and, if required by applicable law, submitted to
and approved by the building or other relevant department, which describe and
show a Casino and the labor and materials necessary for construction thereof.
"Pledge Agreement" means the Pledge Agreement dated October 8, 1993, as
amended by Amendment of 1993 Pledge Agreement dated March 3, 1997, from the
Company, Elsub Management Corporation, and Palm Springs East Limited
Partnership, as Pledgors, to the Trustee for the benefit of Holders as the same
may be amended from time to time.
"Principal" of any Indebtedness (including the Securities) means the
principal of such Indebtedness plus any applicable premium, if any, on such
Indebtedness.
"Property" or "property" means any right or interest in or to property
or assets of any kind whatsoever, whether real, personal or mixed and whether
tangible, intangible, contingent, indirect or direct.
Purchase Agreement" means the Purchase Agreement by and among the
Company, the Guarantors and the Purchasers, dated as of the date hereof,
providing for the several purchases of the Securities (including the
Guaranties).
"Purchasers" means the Purchasers named on the execution pages attached
to the Purchase Agreement.
"Qualified Capital Stock" means any Capital Stock of the Company that
is not Disqualified Capital Stock.
"Record Date" means a Record Date specified in the Securities whether
or not such Record Date is a Business Day.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to Article III of
this Indenture and Paragraph 5 in the form of Security.
"Redemption Price," when used with respect to any Security to be
redeemed, means the principal amount of the Security, without premium, together
with accrued and unpaid interest with respect to such Security to the applicable
Redemption Date.
"Reference Period" with regard to any person means the four full fiscal
quarters ended immediately preceding any date upon which any determination is to
be made pursuant to the terms of the Notes or the Indenture.
"Refinancing Indebtedness" means Indebtedness or Disqualified Capital
Stock (a) issued in exchange for, or the proceeds from the issuance and sale of
which are used substantially concurrently to repay, redeem, defease, refund,
refinance, discharge or otherwise retire for value, in whole or in part, or (b)
constituting an amendment, modification or supplement to, or a deferral or
renewal of ((a) and (b) above are, collectively, a "Refinancing"), any
Indebtedness or Disqualified Capital Stock in a principal amount or, in the case
of Disqualified Capital Stock, liquidation preference, not to exceed (after
deduction of reasonable and customary fees and expenses incurred in connection
with the Refinancing) the lesser of (i) the principal amount or, in the case of
Disqualified Capital Stock, liquidation preference, of the Indebtedness or
Disqualified Capital Stock so Refinanced and (ii) if such Indebtedness being
Refinanced was issued with an original issue discount, the accreted value
thereof (as determined in accordance with GAAP) at the time of such Refinancing;
provided, that (A) Refinancing Indebtedness of any Subsidiary of the Company
shall only be used to Refinance outstanding Indebtedness or Disqualified Capital
Stock of such Subsidiary, (B) Refinancing Indebtedness shall (x) not have an
Average Life less than the Indebtedness or Disqualified Capital Stock to be so
refinanced at the time of such Refinancing and (y) in all respects, be no less
subordinated, if applicable, to the rights of Holders pursuant to the Notes than
was the Indebtedness or Disqualified Capital Stock to be refinanced and (C) such
Refinancing Indebtedness shall have no installment of principal (or redemption)
scheduled to come due earlier than the scheduled maturity of any installment of
principal (or redemption) of the Indebtedness (or Disqualified Capital Stock) to
be so refinanced which was scheduled to come due prior to the Stated Maturity.
"Registrar" shall have the meaning specified in Section 2.4.
"Required Regulatory Redemption" shall have the meaning specified in
Section 3.2.
"Restricted Investment" means any Investment provided, that the
extension of credit to customers of a Casino, consistent with industry practice
and in the ordinary course of business, shall not be a Restricted Investment.
"Restricted Payment" means, with respect to any person, (a) the
declaration or payment of any dividend or other distribution in respect of
Capital Stock of such person or any Subsidiary of such person, (b) any payment
on account of the purchase, redemption or other acquisition or retirement for
value of Capital Stock of such person or any Subsidiary of such person, (c) any
purchase, redemption, or other acquisition or retirement for value of, any
payment in respect of any amendment of the terms of, or any defeasance of, any
subordinated Indebtedness, directly or indirectly, by such person or a
Subsidiary of such person prior to the scheduled maturity, any scheduled
repayment of principal, or scheduled sinking fund payment, as the case may be,
of such Indebtedness and (d) any Restricted Investment by such person; provided,
however, that the term "Restricted Payment" shall not include:
(i) any dividend, distribution or other payment on or with
respect to Capital Stock of a person to the extent payable solely in shares of
Qualified Capital Stock of such person,
(ii) any dividend, distribution or other payment to the
Company, or any of its directly or indirectly wholly owned Subsidiaries, by any
of its Subsidiaries, or any Investment by the Company or any Guarantor in any of
its wholly owned Guarantors, and
(iii) any defeasance, redemption, repurchase, acquisition, or
other retirement for value, in whole or in part, of any subordinated
Indebtedness of an issuer in exchange for or with the Net Proceeds from the
substantially concurrent sale of Disqualified Capital Stock or Subordinated
Indebtedness of such issuer, which Capital Stock or Subordinated Indebtedness is
at least as subordinated in ranking to the Notes (or Guaranties, as applicable)
and has a lower yield to maturity than, and has no installment (contingent or
otherwise) of principal or liquidation amount (including upon the happening of
an event or the passage of time) due before any installment of principal of, the
subordinated Indebtedness being so defeased, redeemed, repurchased, acquired or
retired and, in a principal amount or with a liquidation preference (or, if such
Indebtedness is issued at less than its principal amount, with an original issue
price, as determined in accordance with GAAP) not to exceed the lesser of (x)
the principal amount of such subordinated Indebtedness being so defeased,
redeemed, repurchased, acquired or retired in exchange therefor and (y) if such
subordinated Indebtedness being acquired was issued with an original issue
discount, the accreted value thereof (as determined in accordance with GAAP) at
the time of such transaction.
"SEC" means the Securities and Exchange Commission.
"Securities" or "Notes" means the Amended and Restated Notes, as
amended or modified from time to time in accordance with the terms hereof,
issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Securityholder" See "Holder."
"Senior Noteholders" means the Persons which signed the Senior Note
Purchase Agreement as "Purchasers" and their successors and assigns.
"Senior Notes" means the notes issued by Company pursuant to the Senior
Note Purchase Agreement.
"Senior Note Purchase Agreement" means that certain Note and Stock
Purchase Agreement by and among Company, Guarantors, and the Senior Noteholders
dated October 11, 1994.
"Senior Note Documents" means the Senior Notes, the Senior Note
Purchase Agreement, and all documents evidencing, guaranteeing, securing, or in
any way relating to the Senior Notes and the Senior Note Purchase Agreement.
"Stated Maturity," when used with respect to any Security, means August
20, 2001.
"Subordinated Indebtedness" means indebtedness of the Company or a
Guarantor, as applicable, that is subordinated in right of payment to the
Securities or the Guaranty, as applicable, in all respects and has no scheduled
installment of principal due, by redemption, sinking fund payment or otherwise,
on or prior to the Stated Maturity of the securities.
"Subsidiary," with respect to any person, means (i) a corporation a
majority of whose Capital Stock with voting power, under ordinary circumstances,
to elect directors is at the time, directly or indirectly, owned by such person,
by such person and one or more Subsidiaries of such person or by one or more
Subsidiaries of such person or (ii) any other person (other than a corporation)
in which such person, one or more Subsidiaries of such person, or such person
and one or more subsidiaries of such person, directly or indirectly, at the date
of determination thereof has at least majority ownership interest. An
Unrestricted Subsidiary is not a subsidiary of the Company for purposes of the
Indenture or the Notes.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code 00xx.xx.
77aaa-77bbb) as in effect on the date of the execution of this Indenture.
"Title Policy" means Policy of Title Insurance No. _________ issued by
Commonwealth Title Insurance Company dated as of March 3, 1997, which insures
the Deed of Trust.
"Trustee" means the party named as such in this indenture until a
successor replaces it in accordance with the provisions of this indenture and
thereafter means such successor.
"Trust Officer" means any officer within the corporate trust department
(or any successor group) of the Trustee including any vice president, assistant
vice president, secretary, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer of
the corporate trust department (or any successor group) of the Trustee to whom
such trust matter is referred because of his knowledge of and familiarity with
the particular subject.
"U.S. Government Obligations" means direct non-callable obligations of,
or non-callable obligations guaranteed by, the United States of America for the
payment of which obligation or guarantee the full faith and credit of the United
States of America is pledged.
"U.S. Legal Tender" means 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.
"Unrestricted Subsidiary" shall mean any Subsidiary of the Company
that, at the time of determination shall be an Unrestricted Subsidiary as
designated by the Board of Directors of the Company, as provided below. The
Board of Directors of the Company may designate any subsidiary of the Company
(including any newly acquired or newly formed subsidiary at or prior to the time
it is so formed or acquired) to be an Unrestricted Subsidiary if (a) no Default
or Event of Default is existing or will occur as a consequence thereof, (b)
immediately after giving effect to such designation, on a pro forma basis, the
Company could incur at least $1.00 of additional Indebtedness pursuant to
paragraph (a) of Section 5.11, provided that this clause (b) shall not apply to
the designation of Unrestricted Subsidiaries that are capitalized solely with
assets constituting "Permitted Equity Proceeds Investments" and (c) such
subsidiary does not own any Capital Stock of, or own or hold any Lien on any
property of, the Company or any Subsidiary of the Company. The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Subsidiary, provided that (i) no Default or Event of Default is existing or will
occur as a consequence thereof and (ii) immediately after giving effect to such
designation, on a pro forma basis, the Company could incur at least $1.00 of
additional Indebtedness pursuant to paragraph (a) of Section 5.11. Each
designation shall be evidenced by filing with the Trustee a certified copy of
the resolution giving effect to such designation and an Officers, Certificate
certifying that such designation complied with the foregoing conditions.
Notwithstanding anything to the contrary, Four Queens, Inc., Pinnacle Gaming
Corporation (formerly known as Elsub II Inc.), Elsub Management Corporation,
Four Queens Experience Corporation, Eagle Gaming, Inc., Palm Springs East, L.P.
and Olympia Gaming Corporation and their direct and indirect Subsidiaries shall
not at any time be Unrestricted Subsidiaries.
"wholly owned" with respect to a Subsidiary of any person means (i)
with respect to a Subsidiary that is a limited liability company or similar
entity, a Subsidiary whose capital stock is 99% or greater beneficially owned by
such person and (ii) with respect to a Subsidiary that is other than a limited
liability company or similar entity, a Subsidiary whose capital stock or other
equity interest is 100% beneficially owned by such person.
SECTION 1.2 Incorporation by Reference of TIA.
---------------------------------
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture securityholder" means a Holder or a Securityholder.
"indenture to be Qualified means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them thereby.
SECTION 1.3 Rules of Construction.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined
has the meaning assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural,
and words in the plural include the singular;
(v) provisions apply to successive events and
transactions;
(vi) "herein," "hereof" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision; and
(vii) references to Sections or Articles means
reference to such Section or Article in this Indenture, unless stated
otherwise.
ARTICLE II
THE SECURITIES
SECTION 2.1 Exchange Of Original Notes For Restated Notes.
(a) The Trustee shall certify to the Company a list of the
registered Holders of the Original Notes as of the Confirmation Date for each of
the Original Notes designating the name, address, taxpayer identification number
(if known), certificate number, and the amount of unpaid principal of the
Original Notes for each Holder. The unpaid principal designated shall be the
amount outstanding as of the Confirmation Date. All distributions of Restated
Notes shall be made to the registered Holders of the Original Notes as set forth
on the list certified to the Company by the Trustee. Entities that have acquired
Original Notes after the Confirmation Date will not be entitled to receive any
distributions of Restated Notes.
(b) As a condition to receiving the Restated Notes the
Holders of the Original Notes shall surrender their Original Notes to the
Trustee for cancellation. Upon surrender of the Original Notes, Holders of the
Original Notes will receive their pro rata share of the Restated Notes in the
amount of 52.6315% of the unpaid principal of such Original Notes, as designated
on the list provided pursuant to subsection 2.1(a) above; provided, however,
that if such amount exceeds an integral multiple of $1,000, the amount of such
excess shall be paid in cash and the Note to be issued under this Indenture
shall be issued in the amount of the largest integral multiple of $1,000
included in such amount. When a Holder surrenders its Original Notes to the
Trustee, the Trustee shall hold such instrument in "book entry only" until such
Original Notes are canceled.
(c) Any Holder whose Original Notes have been lost, stolen,
mutilated or destroyed, shall, in lieu of surrendering such Original Notes,
deliver to the Trustee (a) evidence satisfactory to the Trustee of the loss,
theft, mutilation, or destruction of such Original Notes and (b) such security
or indemnity that may be reasonably required by the Trustee to hold the Trustee
harmless with respect to any such representation of the Holder. Upon compliance
with the preceding sentence, such Holder shall, for all purposes under this
Indenture and the Plan, be deemed to have surrendered such Original Notes.
(d) As provided in the Plan, any Holder of Original Notes
which shall not have surrendered or have been deemed to surrender its Original
Notes within two (2) years after the Effective Date shall have its Claim (as
defined in the Plan) disallowed, shall receive no distribution of Restated Notes
under this Indenture or the Plan, and shall be forever barred from asserting any
claim against the Company or Guarantors on account of its Claim. Any Restated
Notes issued and held for distribution on account of such Original Notes shall
be canceled.
SECTION 2.2 Form and Dating.
The Amended and Restated Notes and the Trustee's certificate of
authentication, in respect thereof, shall be substantially in the form of
Exhibit B hereto. The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage. The Company shall approve the
form of the Securities and any notation, legend or endorsement on them. Any such
notations, legends or endorsements not contained in the form of Security
attached as Exhibit B hereto shall be delivered in writing to the Trustee. Each
Security shall be dated the date of its authentication.
The terms and provisions contained in the form of Securities shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Company and the Trustee, by their execution and delivery
of this Indenture, expressly agree to such terms and provisions and to be bound
thereby.
SECTION 2.3 Execution and Authentication.
Two Officers shall sign, or one officer shall sign and one officer
shall attest to, the Securities for the Company by manual or facsimile
signature. The Company's seal shall be impressed, affixed, imprinted, or
reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security was an officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless and the
Company shall nevertheless be bound by the terms of the Securities and this
Indenture.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security, but
such signature shall be conclusive evidence that the Security has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate Securities for original issue in the
aggregate principal amount of up to $30,000,000 upon a written order of the
Company in the form of an Officers' Certificate. The Officers' Certificate shall
specify the amount of Securities to be authenticated and the date on which the
Securities are to be authenticated. The aggregate principal amount of Securities
outstanding at any time may not exceed $30,000,000, except as provided in
Section 2.8. Upon the written order of the Company in the form of an Officers'
Certificate, the Trustee shall authenticate Securities in substitution of
Securities originally issued to reflect any name change of the Company.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company, any Affiliate of the Company
or any of their respective Subsidiaries.
Securities shall be issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof.
SECTION 2.4 Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, where Securities may be presented for
registration of transfer or for exchange ("Registrar") and an office or agency
in the Borough of Manhattan, The City of New York where Securities may be
presented for payment ("Paying Agent") and an office or agency where notices and
demands to or upon the Company in respect of the Securities may be served. The
Company may act as its own Registrar or Paying Agent, except that, for the
purposes of Articles III and IX, neither the Company nor any Affiliate of the
Company shall act as Paying Agent. The Registrar shall keep a register of the
Securities and of their transfer and exchange. The Company may have one or more
co-Registrars and one or more additional Paying Agents. The term "Paying Agent"
includes any additional Paying Agent. The Company hereby initially appoints the
Trustee as Registrar and Paying Agent, and the Trustee hereby initially agrees
so to act.
The Company shall enter into an appropriate written agency agreement
with any Agent not a party to this Indenture, which agreement shall implement
the provisions of this Indenture that relate to such Agent. The Company shall
promptly notify the Trustee in writing of the name and address of any such
Agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee
shall act as such.
SECTION 2.5 Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of, or interest on, the Securities (whether such assets have been
distributed to it by the Company or any other obligor on the Securities), and
shall notify the Trustee in writing of any Default by the Company (or any other
obligor on the Securities) in making any such payment. If the Company or a
Subsidiary of the Company acts as Paying Agent, it shall segregate such assets
and hold them as a separate trust fund for the benefit of the Holders or the
Trustee. The Company at any time may require a Paying Agent to distribute all
assets held by it to the Trustee and account for any assets disbursed and the
Trustee may at any time during the continuance of any payment Default, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed. Upon
distribution to the Trustee of all assets that shall have been delivered by the
Company to the Paying Agent, the Paying Agent (if other than the Company) shall
have no further liability for such assets.
SECTION 2.6 Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company shall furnish to the
Trustee on or before the third Business Day preceding each Interest Payment Date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee reasonably may require of the names and
addresses of Holders. The Trustee, the Registrar and the Company shall provide a
current securityholder list to any Gaming Authority upon demand.
SECTION 2.7 Transfer and Exchange.
When Securities are presented to the Registrar or a co-Registrar with a
request to register the transfer of such Securities or to exchange such
Securities for an equal principal amount of Securities of other authorized
denominations, the Registrar or co-Registrar shall register the transfer or make
the exchange as requested if its reasonable requirements for such transaction
are met; provided, however, that the Securities surrendered for transfer or
exchange shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing. To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities at the
Registrar's or co-Registrar's request. No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax, assessments, or similar governmental
charge payable in connection therewith (other than any such transfer taxes,
assessments, or similar governmental charge payable upon exchanges or transfers
pursuant to Sections 2.2, 2.10, 3.6, or 10.5). Except for a required regulatory
redemption pursuant to Section 3.2 of this Indenture or an order of any Gaming
Authority, the Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Security selected for redemption in whole or in
part pursuant to Article Three, except the unredeemed portion of any Security
being redeemed in part.
SECTION 2.8 Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims and submits an affidavit or other evidence, satisfactory to
the Trustee, to the Trustee to the effect that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements are met. If
required by the Trustee or the Company, such Holder must provide an indemnity
bond or other indemnity, sufficient in the judgment of both the Company and the
Trustee, to protect the Company, the Trustee or any Agent from any loss which
any of them may suffer if a Security is replaced. The Company may charge such
Holder for its reasonable, out-of-pocket expenses in replacing a Security. Every
replacement Security is an additional obligation of the Company.
SECTION 2.9 Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those canceled by it, those delivered
to it for cancellation and those described in this Section 2.9 as not
outstanding. A Security does not cease to be outstanding because the Company or
an Affiliate of the Company holds the Security, except as provided in Section
2.10.
If a Security is replaced pursuant to Section 2.8 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section 2.8.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Company or an Affiliate of the Company) holds U.S. Legal Tender or U.S.
Government Obligations sufficient to pay all of the principal and interest due
on the Securities payable on that date and payment of the Securities called for
redemption is not otherwise prohibited, then on and after that date such
Securities cease to be outstanding and interest on them ceases to accrue.
SECTION 2.10 Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, amendment, supplement, waiver or
consent, Securities owned by the Company, any Guarantor and Affiliates of the
Company or of any Guarantor shall be disregarded, except that, for the purposes
of determining whether the Trustee shall be protected in relying on any such
direction, amendment, supplement, waiver or consent, only Securities that the
Trustee knows or has reason to know are so owned shall be disregarded.
SECTION 2.11 Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare, the Guarantor shall endorse and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company reasonably and in
good faith considers appropriate for temporary Securities. Without unreasonable
delay, the Company shall prepare, the Guarantor shall endorse and the Trustee
shall authenticate definitive Securities in exchange for temporary Securities.
Until so exchanged, the temporary Securities shall in all respects be entitled
to the same benefits under this Indenture as permanent Securities authenticated
and delivered hereunder.
SECTION 2.12 Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent
(other than the Company or an Affiliate of the Company), and no one else, shall
cancel and, at the written direction of the Company, shall dispose of all
Securities surrendered for transfer, exchange, payment or cancellation. Subject
to Section 2.8, the Company may not issue new Securities to replace Securities
it has paid or delivered to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section 2.12, except as expressly permitted in the form of Securities
and as permitted by this Indenture.
SECTION 2.13 Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, it
shall pay the defaulted interest, plus (to the extent lawful) interest on the
defaulted interest, to the persons who are Holders on a Record Date (or at its
option a subsequent special record date) which date shall be the fifteenth day
next preceding the date fixed by the Company for the payment of defaulted
interest, whether or not such day is a Business Day, unless the Trustee fixes
another record date. At least 15 days before the subsequent special record date,
the Company shall mail to each Holder with a copy to the Trustee a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid.
ARTICLE III
REDEMPTION
SECTION 3.1 Right of Redemption.
Redemption of Securities shall be made in accordance with this Article
III. At its election, the Company may redeem the Securities in whole or from
time to time in part, at any time upon payment of the Redemption Price.
SECTION 3.2 Redemption Pursuant to Gaming Laws.
Notwithstanding any other provision of this Indenture, the Notes shall
also be redeemable at any time pursuant to, and in accordance with, any order of
any Gaming Authority with appropriate jurisdiction and authority, or to the
extent necessary in the reasonable, good faith judgment of the Board of
Directors of the Company to prevent the loss or material impairment or secure
the reinstatement of any Gaming License or to prevent such Gaming Authority from
taking any other action, which if lost, impaired, not reinstated or taken, as
the case may be, would have a material adverse effect on the Company or any
Guarantor, or where such redemption or acquisition is required because the
holder or beneficial owner of such security redeemed or acquired is required to
qualify, be found suitable, or become licensed as such under such Gaming Laws
and such holder or beneficial owner refuses to, or does not so qualify, obtain a
finding of suitability or become licensed (a "Required Regulatory Redemption") .
If the Company requires the redemption of any Security pursuant to this Section
3.2, then the redemption price shall be the principal amount thereof, plus
accrued interest to the date of such determination of unsuitability. The Company
shall tender the redemption price (together with any accrued and unpaid
interest) to the Trustee no later than thirty (30) days after the Company gives
the Securityholder or owner of a beneficial or voting interest written notice of
redemption or such earlier date as may be ordered by any Gaming Authority. The
Company shall notify the Trustee of any disposition or redemption required under
this Section 3.2, and upon receipt of such notice, the Trustee shall not accord
any rights or privileges under this Indenture or any Security to any
Securityholder or owner of a beneficial or voting interest who is required to
dispose of any Security or tender it for redemption, except to pay the
redemption price (together with any accrued but unpaid interest) upon tender of
such Security.
SECTION 3.3 Notices to Trustee.
If the Company elects to redeem Securities pursuant to Article III, it
shall notify the Trustee in writing of the date on which the Notes are to be
redeemed ("Redemption Date") and the principal amount of Securities to be
redeemed and whether it wants the Trustee to give notice of redemption to the
Holders.
If the Company elects to reduce the principal amount of Securities to
be redeemed pursuant to Paragraph 5 of the Securities by crediting against any
such redemption Securities it has not previously delivered to the Trustee for
cancellation, it shall so notify the Trustee of the amount of the reduction and
deliver such Securities with such notice.
The Company shall give each notice to the Trustee provided for in this
Section 3.3 at least 30 days before the Redemption Date (unless a shorter notice
shall be satisfactory to the Trustee or required by applicable Gaming Laws).
SECTION 3.4 Selection of Securities to Be Redeemed.
If less than all of the Securities are to be redeemed pursuant to
Paragraph 5 thereof, the Trustee shall select from among such Securities to be
redeemed pro rata or by lot or by such other method as the Trustee shall
determine to be fair and appropriate and in such manner as complies with any
applicable legal and stock exchange requirements.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
in writing of the Securities selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount thereof to be
redeemed. Securities in denominations of $1,000 may be redeemed only in whole.
The Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Securities that have denominations larger
than $1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of securities called for redemption.
SECTION 3.5 Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Securities are to be redeemed (unless a shorter
notice shall be required by applicable Gaming Laws). At the Company's request,
the Trustee shall give the notice of redemption in the Company's name and at the
Company's expense. Each notice for redemption shall identify the Securities to
be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price, including the amount of a
ccrued and unpaid interest to be paid upon such redemption;
(3) the name, address and telephone number of the Paying
Agent;
(4) that Securities called for redemption must be
surrendered to the Paying Agent at the address specified in such notice to
collect the Redemption Price;
(5) that, unless (a) the Company defaults in its obligation
to deposit U.S. Legal Tender with the Paying Agent in accordance with Section
3.7 hereof or (b) such redemption payment is prevented for any reason, interest
on Securities called for redemption ceases to accrue on and after the Redemption
Date and the only remaining right of the Holders of such Securities is to
receive payment of the Redemption Price, including accrued and unpaid interest,
upon surrender to the Paying Agent of the Securities called for redemption and
to be redeemed;
(6) if any Security is being redeemed in part, the portion of
the principal amount, equal to $1,000 or any integral multiple thereof, of such
Security to be redeemed and that, after the Redemption Date, and upon surrender
of such Security, a new Security or Securities in aggregate principal amount
equal to the unredeemed portion thereof will be issued;
(7) if less than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be redeemed,
as well as the aggregate principal amount of such Securities to be redeemed and
the aggregate principal amount of Securities to be outstanding after such
partial redemption;
(8) the CUSIP number of the Securities to be redeemed;
and
(9) that the notice is being sent pursuant to this Section
3.4 and pursuant to the optional redemption provisions of Paragraph 5 of the
Securities.
SECTION 3.6 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.5,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price, including accrued and unpaid interest. Upon
surrender to the Trustee or Paying Agent, such Securities called for redemption
shall be paid at the Redemption Price, including interest, if. any, accrued to
and unpaid on the Redemption Date; provided that if the Redemption Date is after
a regular Record Date and on or prior to the Interest Payment Date, the accrued
interest shall be payable to the Holder of the redeemed Securities registered on
the relevant Record Date; and provided, further, that if a Redemption Date is a
Legal Holiday, payment shall be made on the next succeeding Business Day and no
interest shall accrue for the period from such Redemption Date to such
succeeding Business Day.
SECTION 3.7 Deposit of Redemption Price.
On or before the Redemption Date, the Company shall deposit with the
Paying Agent (other than the Company or an Affiliate of the Company) U.S. Legal
Tender sufficient to pay the Redemption Price of, including accrued and unpaid
interest on, all Securities to be redeemed on such Redemption Date (other than
Securities or portions thereof called for redemption on that date that have been
delivered by the Company to the Trustee for cancellation). The Paying Agent
shall promptly return to the Company any U.S. Legal Tender so deposited which is
not required for that purpose upon the written request of the Company.
If the Company complies with the preceding paragraph and the other
provisions of this Article III and payment of the Securities called for
redemption is not prevented for any reason, interest on the Securities to be
redeemed will cease to accrue on the applicable Redemption Date, whether or not
such Securities are presented for payment. Notwithstanding anything herein to
the contrary, if any Security surrendered for redemption in the manner provided
in the Securities shall not be so paid upon surrender for redemption because of
the failure of the Company to comply with the preceding paragraph and the other
provisions of this Article III, interest shall continue to accrue and be paid
from the Redemption Date until such payment is made on the unpaid principal,
and, to the extent lawful, on any interest not paid on such unpaid principal, in
each case at the rate and in the manner provided in Section 5.1 hereof and the
Securities.
SECTION 3.8 Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part, the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge, a new Security or Securities equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE IV
SECURITY
SECTION 4.1 Security Interest.
(a) In order to secure the Indenture Obligations, the Company,
the Guarantors and the Trustee have entered into the Mortgage. Each Holder, by
accepting a Security, agrees to all of the terms and provisions of the Mortgage
and the Trustee agrees to all of the terms and provisions of the Mortgage as the
Mortgage may be amended from time to time pursuant to the provisions thereof and
hereof.
(b) The Collateral as now or hereafter constituted shall be
held for the equal and ratable benefit of the Holders without preference,
priority or distinction of any thereof over any other by reason of difference in
time of issuance, sale or otherwise, as security for the Indenture Obligations.
(c) The provisions of TIA ss. 314(d), and the provisions of
TIA ss. 314(c)(3) to the extent applicable by specific reference in this Article
Four, are hereby incorporated by reference herein as if set forth in their
entirety and to the same extent as if the Indenture were qualified under the
TIA.
SECTION 4.2 Recording; Opinions of Counsel.
(a) The Company represents that it has caused to be executed
and delivered, filed and recorded and covenants that it will promptly cause to
be executed and delivered, filed and recorded, all instruments and documents,
and have done and will do or will cause to be done all such acts and other
things, at the Company's expense, as are necessary to subject the Collateral to
valid security interests and to perfect those security interests. The Company
shall, as promptly as practicable, cause to be executed and delivered, filed and
recorded all instruments and do all acts and other things as may be required by
law to perfect, maintain and protect the security interests under the Mortgage
and herein. The Company has obtained endorsements of title insurance naming the
Trustee as insured for the benefit of the Holders in the aggregate amount equal
to the cost of Property that is real property subject to the Mortgage, subject
only to those exceptions which are reasonably acceptable to the Trustee.
(b) The Company shall furnish to the Trustee, within 60 days
after April 1 in each year (beginning April 1, 1997) an Opinion(s) of Counsel,
dated as of such date, stating that, in the opinion of such counsel, subject to
customary exclusions and exceptions, either (A) all action has been taken with
respect to the recording, registering, filing, rerecording and refiling of the
Indenture, all supplemental indentures, the Mortgage, financing statements,
continuation statements and all other instruments of further assurance as is
necessary to maintain the security interests under the Mortgage and hereunder in
full force and effect and reciting the details of such action or referring to
prior Opinions of Counsel in which such details are given, and stating that all
financing statements and continuation statements have been executed and filed
and such other actions taken that are necessary fully to preserve and protect
the rights of the Holders and the Trustee hereunder and under the Mortgage, or
(B) no such action is necessary to maintain the security interests in full force
and effect.
SECTION 4.3 Disposition of Certain Collateral.
(a) The Company and the Guarantors may, without
consent of the Trustee, but otherwise subject to the requirements of this
Indenture:
(i) sell, assign, transfer, license or otherwise
dispose of, free from the security interests under the Mortgage and
hereunder, any machinery, equipment, or other personal Property
constituting Collateral that has become worn out, obsolete, or
unserviceable or is being upgraded, upon replacing the same with or
substituting for the same, machinery, equipment or other Property
constituting Collateral not necessarily of the same character but
being, of at least equal fair value and at least equal utility to the
Company as the Property so disposed of, which Property shall without
further action become Collateral subject to the security interests
under the Mortgage and hereunder;
(ii) (A) sell, assign, transfer, license or otherwise
dispose of, free from the security interests under the mortgage and
hereunder, inventory held for resale that is at any time part of the
Collateral in the ordinary course of the Company's business, consistent
with industry practices, (B) collect, liquidate, sell, factor or
otherwise dispose of, free from the security interests, accounts
receivable or notes receivable that are part of the Collateral in the
ordinary course of the Company's business, consistent with industry
practices, or (C) make Cash payments (including scheduled repayments of
Indebtedness permitted to be incurred hereby) from Cash that is at any
time part of the Collateral in the ordinary course of business;
(iii) abandon, sell, assign, transfer, license or
otherwise dispose of any personal Property the use of which is no
longer necessary or desirable in the proper conduct of the business of
the Company and its Subsidiaries and the maintenance of its earnings
and is not material to the conduct of the business of the Company and
its Subsidiaries; and
(iv) sell, assign, transfer, license or otherwise
dispose of, free from the Security Interests any assets or property in
accordance with Section 5.14.
(b) Notwithstanding the provisions of subsection (a) above,
the Company and the Guarantors shall not dispose of or transfer (by lease,
assignment, sale or otherwise) or pledge, mortgage or otherwise encumber
Collateral pursuant to the provisions of Section 4.3(a)(ii) or (iii) with a fair
value of 10% or more of the aggregate fair value of all Collateral then existing
in any transaction or any series of related transactions.
(c) In the event that the Company or any Guarantor has sold,
exchanged, or otherwise disposed of or proposes to sell, exchange or otherwise
dispose of any portion of the Collateral which under the provisions of this
Section 4.3 may be sold, exchanged or otherwise disposed of by the Company and
the Guarantors without consent of the Trustee, and the Company and the
Guarantors request the Trustee to furnish a written disclaimer, release or
quitclaim of any interest in such property under the Mortgage, the Trustee shall
execute such an instrument upon delivery to the Trustee of an Officers,
Certificate by the Company and the Guarantors reciting the sale, exchange or
other disposition made or proposed to be made and describing in reasonable
detail the property affected thereby, and stating and demonstrating that such
property is property which by the provisions of this Section 4.3 may be sold,
exchanged or otherwise disposed of or dealt with by the Company and the
Guarantors without any release or consent of the Trustee.
(d) Any disposition of Collateral made in compliance with the
provisions of this Section 4.3 shall be deemed not to impair the Security
Interests in contravention of the provisions of this Indenture.
Certain Releases of Collateral. leases of Collateral.
Subject to applicable law, the release of any Collateral from the terms
of the Mortgage or the release of, in whole or in part, the Liens created by the
Mortgage, will not be deemed to impair the Mortgage in contravention of the
provisions of this Indenture if and to the extent the Collateral or Liens are
released pursuant to, and in accordance with, the applicable agreement creating
the Mortgage and pursuant to, and in accordance with, the terms hereof. To the
extent applicable, without limitation, the Company and each obligor on the
Securities shall cause Trust Indenture Act ss. 314(d) relating to the release of
property or securities from the Liens of the Mortgage to be complied with. Any
certificate or opinion required by Trust Indenture Act ss. 314(d) may be made by
one officer prior to the qualification of the Indenture under the TIA and by two
officers after such qualification, except in cases which Trust Indenture Act
314(d) requires that such certificate or opinion be made by an independent
person.
Notwithstanding any other provision of this Indenture, the Notes, or
the Mortgage, upon payment to the Trustee of Two Million and no/100 Dollars
($2,000,000), the Trustee shall cause the Release Parcel to be released from the
Mortgage by causing to be recorded a deed of partial reconveyance in the
Official Records of Xxxxx County, Nevada. Such payment shall be applied: (a)
first, to redemption of Senior Notes as provided in the Senior Note Purchase
Agreement; and (b) any remaining portion of such payment shall be applied to
redemption of Notes as provided in Article III of this Indenture.
SECTION 4.5 Payment of Expenses.
On demand of the Trustee, the Company forthwith shall pay or
satisfactorily provide for all reasonable expenditures incurred by the Trustee
under this Article IV, including the reasonable fees and expenses of counsel and
all such sums shall be a Lien upon the Collateral and shall be secured thereby.
SECTION 4.6 Suits to Protect the Collateral.
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Subject to Section 4.1 of this Indenture and to the provisions of the
Mortgage, the Trustee shall have power to institute and to maintain such suits
and proceedings as it may deem expedient to prevent any impairment of the
Collateral by any acts which may be unlawful or in violation of the Mortgage or
this Indenture, including the power to institute and maintain suits or
proceedings to restrain the enforcement of or compliance with any legislative or
other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid or if the enforcement of, or compliance with, such enactment,
rule or order would impair the security interests in contravention of this
Indenture or be prejudicial to the interests of the Holders or of the Trustee.
The Trustee shall give notice to the Company promptly following the institution
of any such suit or proceeding.
SECTION 4.7 Trustee's Duties.
The powers and duties conferred upon the Trustee by this Article IV are
solely to protect the Security Interests and shall not impose any duty upon the
Trustee to exercise any such powers and duties, except as expressly provided in
this Indenture. The Trustee shall be under no duty to the Company or any
Guarantor whatsoever to make or give any presentment, demand for performance,
notice of nonperformance, protest, notice of protest, notice of dishonor, or
other notice or demand in connection with any Collateral, or to take any steps
necessary to preserve any rights against prior parties except as expressly
provided in this Indenture. The Trustee shall not be liable to the Company or
the Guarantors for failure to collect or realize upon any or all of the
Collateral, or for any delay in so doing, nor shall the Trustee be under any
duty to the Company or the Guarantors to take any action whatsoever with regard
thereto. The Trustee shall have no duty to the Company or the Guarantors to
comply with any recording, filing, or other legal requirements necessary to
establish or maintain the validity, priority or enforceability of the Security
Interests in, or the Trustee's rights in or to, any of the Collateral.
ARTICLE V
COVENANTS
SECTION 5.1 Payment of Securities.
The Company shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities and this Indenture. An
installment of principal of or interest on the Securities shall be considered
paid on the date it is due if the Trustee or Paying Agent (other than the
Company or an Affiliate of the Company) holds for the benefit of the Holders, on
or before 10:00 a.m. New York City time on that date, U.S. Legal Tender
deposited and designated for and sufficient to pay the installment.
The Company shall pay interest on overdue principal and on overdue
installments of interest at the rate specified in the Securities compounded
semi-annually, to the extent lawful.
SECTION 5.2 Maintenance of Office or Agency.
The Company and the Guarantors shall maintain in the Borough of
Manhattan, The City of New York, an office or agency where Securities may be
presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company and the Guarantors in respect of the Securities and this Indenture
may be served. The Company and the Guarantors shall give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Company and the Guarantors shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the address of the Trustee set forth in Section 14.2.
The Company and the Guarantors may also from time to time designate one
or more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company and the Guarantors of their obligation to
maintain an office or agency in the Borough of Manhattan, The City of New York,
for such purposes. The Company and the Guarantors shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency. The Company and the Guarantors
hereby initially designate the Corporate Trust Office of the Trustee as such
office.
SECTION 5.3 Limitation on Restricted Payments.
(a) The Company and the Guarantors will not, and none will permit any
of their respective Subsidiaries to, make, directly or indirectly, any
Restricted Payment (including Permitted Equity Proceeds Investments) if, after
giving effect thereto on a pro forma basis:
(1) a Default or an Event of Default shall have occurred
and be continuing; or
(2) the aggregate amount of all Restricted Payments (including
Permitted Equity Proceeds Investments) made by the Company, the Guarantors and
their respective Subsidiaries, including after giving effect to such proposed
Restricted Payment, from and after the Effective Date, would exceed the sum of
(a) the aggregate Consolidated Net Income of the
Company for the period (taken as one accounting period) commencing on
the first day of the first full fiscal quarter commencing subsequent to
the Effective Date, to and including the last day of the fiscal quarter
ended immediately prior to the date of each such calculation (or, in
the event Consolidated Net Income for such period is a deficit, then
minus 100% of such deficit), minus 100% of the amount of any writedowns
or writeoffs not otherwise reflected in Consolidated Net Income during
such period, plus
(b) the aggregate Net Proceeds received by the
Company from the sale of its Qualified Capital Stock, other than sales
to any of its Subsidiaries, after the Effective Date, plus
(c) the aggregate net book value of Investments
previously made by the Company after the Effective Date which, when
made, reduced amounts available pursuant to this clause (2) that have
been returned to the Company (excluding any such amounts included in
Consolidated Net Income).
Provided, however, that so long as the amount stated in the foregoing
clause (2) of the prior paragraph is not exceeded, the Company and Guarantors
may make Restricted Payments consisting of (t) the Investment of up to $1
million in the aggregate by the Company or any Guarantor in any of their
respective Subsidiaries for working capital purposes, (u) Investments by the
Company or any Guarantor in Fremont Street Experience, L.L.C. (or any other
entity organized for the purpose of operating the Fremont Street Experience) not
to exceed Seven Hundred Fifty Thousand Dollars ($750,000) in the aggregate
during any 12-month period for the purpose of funding operations of the Fremont
Street Experience, (v) any dividend or other distribution by a Guarantor to
stockholders or partners of such Guarantor on a pro rata basis with respect to
the amount and character of property so paid or distributed, (w) a Required
Regulatory Redemption, (x) the defeasance, redemption, repurchase or other
acquisition of Capital Stock or subordinated Indebtedness of the Company with
the Net Proceeds received by the Company from the substantially concurrent sale
of Qualified Capital Stock or in exchange for Qualified Capital Stock, (y) the
payment of any dividend or redemption of Qualified Capital Stock within 60 days
after the date of its declaration or authorization, respectively, if such
dividend or redemption could have been made on the date of such declaration or
authorization in compliance with the foregoing provisions, or (z) the Investment
in or loans to Guarantors for the purpose of financing commitments to third
parties (including, without limitation, good faith deposits and option payments)
to develop, construct, or acquire Casinos or to acquire Native American Casino
Management Contracts.
(b) Prior to the last day of the Company's first full fiscal quarter
subsequent to the Effective Date during which the Company and its Consolidated
Subsidiaries have generated Consolidated EBITDA of at least $1.0 million, the
Company and the Guarantors will not, and none will permit any of their
respective Subsidiaries to, make, directly or indirectly, any Restricted
Payment, except for (i) Investments of Permitted Equity Proceeds Investments up
to an aggregate of $10 million, and (ii) Restricted Payments made in reliance
upon clause (z) of the immediately preceding paragraph.
SECTION 5.4 Corporate Existence.
Except as otherwise provided in the Plan and Order, and subject to
Article VI, the Company and the Guarantors shall do or cause to be done all
things necessary to preserve and keep in full force and effect their corporate
existence and the corporate or other existence of each of their Subsidiaries in
accordance with the respective organizational documents of each of them and the
rights (charter and statutory) and corporate franchises of the Company and their
Guarantors and each of their Subsidiaries; provided, however, that neither the
Company nor any of the Guarantors shall be required to preserve, with respect to
itself, any right or franchise, and with respect to any of their Subsidiaries,
any such existence, right or franchise, if (a) the Board of Directors of the
Company shall determine reasonably and in good faith that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
(b) the loss thereof is not disadvantageous in any material respect to the
Holders.
SECTION 5.5 Payment of Taxes and Other Claims.
Except as otherwise provided in the Plan and Order, the Company and the
Guarantor shall, and shall cause each of their Subsidiaries to, pay or discharge
or cause to be paid or discharged, before the same shall become delinquent, (i)
all taxes, assessments and governmental charges (including withholding taxes and
any penalties, interest and additions to taxes) levied or imposed upon the
Company, any Guarantor or any of their Subsidiaries or properties and assets of
the Company, any Guarantor or any of their Subsidiaries and (ii) all lawful
claims, whether for labor, materials, supplies, services or anything else, which
have become due and payable and which by law have or may become a Lien upon the
property and assets of the Company, any Guarantor or any of their Subsidiaries;
provided, however, that neither the Company nor any Guarantor shall be required
to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings and for which disputed amounts adequate
reserves have been established in accordance with GAAP.
SECTION 5.6 Maintenance of Insurance.
From and at all times after the Effective Date, the Company and its
Subsidiaries shall have in effect customary insurance for business interruptions
and general liability, and shall have completion or similar bonds in place for
all ongoing projects, in each case on terms and in an amount reasonably
sufficient to avoid a material adverse change in the financial condition or
results of operation of the Company and its Subsidiaries taken as a whole.
SECTION 5.7 Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee quarterly within
the times for delivery of annual and quarterly financial statements under
Section 5.8 below an Officers' Certificate complying (whether or not required)
with Section 314 (a) (4) of the TIA and stating that a review of its activities
and the activities of its Subsidiaries during the preceding fiscal year has been
made under the supervision of the signing officers with a view to determining
whether the Company has kept, observed, performed and fulfilled its obligations
under this Indenture and further stating, as to each such Officer signing such
certificate, whether or not the signer knows of any failure by the Company, any
Guarantor or any Subsidiary of the Company or any Guarantor to comply with any
conditions or covenants in this Indenture and, if such signer does know of such
a failure to comply, the certificate shall describe such failure with
particularity. The Officers' Certificate shall also notify the Trustee should
the relevant fiscal year end on any date other than the current fiscal year end
date.
(b) So long as not contrary to the then current recommendation
of the American Institute of Certified Public Accountants, the Company shall
deliver to the Trustee within 120 days after the end of each of its fiscal years
a written report of a firm of independent certified public accountants with an
established national reputation stating that in conducting their audit for such
fiscal year, nothing has come to their attention that caused them to believe
that the Company or any Subsidiary of the Company was not in compliance with the
provisions set forth in Sections 5.3, 5.11, 5.14, 5.15, or 5.16 of this
Indenture.
(c) The Company shall, so long as any of the Securities are
outstanding, deliver to the Trustee, immediately upon becoming aware of any
Default or Event of Default under this Indenture, an Officers, Certificate
specifying such Default or Event of Default and what action the Company is
taking or proposes to take with respect thereto. The Trustee shall not be deemed
to have knowledge of a Default or an Event of Default unless one of its trust
officers receives notice of the Default giving rise thereto from the Company or
any of the Holders.
SECTION 5.8 Reports.
Whether or not the Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall deliver to the
Trustee and to each Holder, within 15 days after it is or would have been
required to file such with the SEC, annual and quarterly financial statements
substantially equivalent to financial statements that would have been included
in reports filed with the SEC if the Company were subject to the requirements of
Section 13 or 15(d) of the Exchange Act including, with respect to annual
information only, a report thereon by the Company's certified independent public
accountants as such would be so required, together with a management's
discussion and analysis of financial condition and results of operations which
would be so required.
SECTION 5.9 Waiver of Stay, Extension or Usury Laws.
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The Company and each Guarantor covenants (to the extent, that it may
lawfully do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law wherever enacted which would
prohibit or forgive the Company or any Guarantor 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 they may
lawfully do so) the Company and each Guarantor hereby expressly waives all
benefit or advantage of any such law insofar as such law applies to the
Securities, and covenant that it shall not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
SECTION 5.10 Limitation on Transactions with Affiliates.
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If the Company, any Guarantor, any Unrestricted Subsidiary, or any of
their respective Subsidiaries shall, on or after the Effective Date, enter into
any transaction, including any contract, agreement, understanding, loan, advance
or guarantee and including any series of related transactions, with or for the
benefit of any Affiliate other than the Company or a Guarantor (an "Affiliate
Transaction") with a value to either party in excess of $500,000, the Company or
such Subsidiary must, prior to the consummation thereof, provide written notice
of the Affiliate Transaction to the Trustee.
SECTION 5.11 Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital
Stock.
Except as set forth below or as stated in the Plan and Order, the
Company and the Guarantors will not, and none will permit any of their
respective Subsidiaries to, directly or indirectly, issue, assume, guaranty,
incur, become directly or indirectly liable with respect to (including as a
result of an acquisition, merger or consolidation), extend the maturity of, or
otherwise become responsible for, contingently or otherwise (individually and
collectively, to "incur," or, as appropriate, an "incurrence"), any Indebtedness
or any Disqualified Capital Stock from and after the Effective Date.
(a) The Company and the Guarantors may incur Indebtedness or
Disqualified Capital Stock if (i) no Default or Event of Default shall have
occurred and be continuing at the time of, or would occur after giving effect,
on a pro forma basis, to such incurrence of such Indebtedness or Disqualified
Capital Stock and (ii) on the date of the incurrence of such Indebtedness or
Disqualified Capital Stock (the "Incurrence Date"), the Consolidated Fixed
Charges Coverage Ratio of the Company for the Reference Period immediately
preceding the Incurrence Date, after giving effect, on a pro forma basis, to
such incurrence of such Indebtedness or Disqualified Capital Stock, would be at
least 2.0 to 1; provided that Indebtedness incurred by a Guarantor shall be
subordinated in all material respects to such Guarantor's guarantee of the
Company's obligations with respect to the Notes, except that Indebtedness
incurred by a Guarantor solely to guarantee Indebtedness of the Company that is
pari passu with the Notes may be pari passu with such applicable Guarantee of
the Notes.
(b) The Company and the Guarantors may incur Indebtedness
evidenced by the Notes and other obligations pursuant to the Indenture up to the
amounts specified therein as of the date thereof.
(c) The Company and the Guarantors may incur Indebtedness
evidenced by the Senior Notes.
(d) The Company and the Guarantors may incur Permitted FF&E
Financing.
(e) The Company and the Guarantors may incur Indebtedness not
to exceed Ten Million Dollars ($10,000,000) in connection with a revolving line
of credit secured by receivables and inventory made available by a bank or other
institutional lender.
(f) The Company and the Guarantors may incur Refinancing
Indebtedness with respect to any Indebtedness or Disqualified Capital stock, as
applicable, described in clauses (a) through (e) of this covenant so long as
such Refinancing Indebtedness satisfies the applicable requirements of such
clauses.
(g) The Company and the Guarantors may incur Indebtedness
solely in respect of bankers acceptances, letters of credit and performance
bonds (to the extent that such incurrence does not result in the incurrence of
any obligation for the payment of borrowed money of others), all in the ordinary
course of business, in amounts and for the purposes customary in the Company's
industry for gaming operations similar to those of the Company; provided that
the aggregate principal amount outstanding of such Indebtedness (including any
Indebtedness issued to refinance, refund or replace such Indebtedness) shall at
no time exceed $2 million.
(h) The Company may incur Indebtedness to any Guarantor of
the Company, any Guarantor of the Company may incur Indebtedness to any other
Guarantor or to the Company; provided that such obligations, in each case, shall
be subordinated in all respects to the Company's obligations pursuant to the
Notes or such Guarantor's obligations pursuant to its guaranty of the Company's
obligations pursuant to the Notes, as the case may be; provided, further, that,
in the event such Guarantor is no longer a Guarantor, any debt owed to such
person shall be deemed an incurrence for purposes of this Section 5.11.
(i) The Company and the Guarantors may incur Indebtedness
representing the balance deferred and unpaid of the purchase price of any
property or services used in the ordinary course of their business that would
constitute ordinarily a trade payable to trade creditors (other than accounts
payable or other obligations to trade creditors arising in the ordinary course
of business which have remained unpaid for greater than 60 days, unless such
payable or obligation is being contested in good faith and for which adequate
reserves have been established in accordance with GAAP).
(j) The Company and any Guarantor may post a bond or surety
obligation in order to prevent the loss or material impairment of, or to obtain,
a Gaming License, or as otherwise required by an order of any Gaming Authority
to the extent required by applicable law and consistent in character and amount
with customary industry practice.
(k) The Company and any Guarantor may incur Indebtedness not
to exceed $3 million in the aggregate outstanding at any time arising under any
appeal or reimbursement obligations with respect to any judgment, which judgment
does not constitute a Default.
(l) The company and any Guarantor may incur Indebtedness not
to exceed $3 million in the aggregate outstanding at any time constituting
reimbursement obligations with respect to letters of credit in respect of
workers' compensation claims.
SECTION 5.12 Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries.
Neither the Company, the Guarantors, nor any of their respective
Subsidiaries will, directly or indirectly, create, assume or suffer to exist any
consensual encumbrance or restriction on the ability of any such Subsidiary to
pay dividends or make other distributions on the Capital Stock of any such
Subsidiary of the Company or pay any obligation to the Company or any of its
Subsidiaries or otherwise transfer assets or make or pay loans or advances to
the Company or any of its Subsidiaries, except (a) restrictions imposed by the
Notes or the Indenture, (b) restrictions imposed by the Senior Notes and Senior
Note Documents, (c) customary provisions restricting subletting or assignment of
any lease entered into in the ordinary course of business, consistent with
industry practices, (d) restrictions imposed by applicable gaming laws or any
applicable Gaming Authority, (e) restrictions under any agreement relating to
any property, asset, or business acquired by the Company or its Subsidiaries,
which restrictions existed at the time of acquisition, were not put in place in
anticipation of such acquisition and are not applicable to any person, other
than the person acquired or to any property, asset or business other than the
property, assets and business of the person so acquired, (f) any such
restriction in existence as of the Effective Date after giving effect to the use
of proceeds to retire existing debt, (g) any restrictions with respect to a
Subsidiary of the Company imposed pursuant to an agreement which has been
entered into for the sale or disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary and (h) replacements of restrictions
imposed pursuant to clauses (a) through (e) that are no more restrictive than
those being replaced.
SECTION 5.13 Limitation on Liens.
Neither the Company, the Guarantors nor their respective Subsidiaries
shall directly or indirectly, create, incur, assume or suffer to exist any Lien
in or on any right, title or interest to any of their respective properties
subject to the Liens of the Mortgage, except Permitted Liens.
SECTION 5.14 Limitations on Sales of Assets and Subsidiary Stock.
Neither the Company, the Guarantors nor any of their respective
Subsidiaries will, in one or a series of related transactions, convey, sell,
transfer, assign or otherwise dispose of, directly or indirectly, any of its
property, business or assets, including upon an Event of Loss, any sale or other
transfer or issuance of any Capital Stock of any Subsidiary of the Company,
whether by the Company or a Subsidiary of the Company, or through the issuance,
sale or transfer of Capital Stock by a Subsidiary of the Company (an "Asset
Sale"), unless (A) no Default or Event of Default shall have occurred and be
continuing at the time of, or would occur after giving effect, on a pro forma,
basis, to, such Asset Sale and (B) the Board of Directors of the Company
determines in good faith that the Company or such applicable Subsidiary receives
fair market value for such Asset Sale.
Notwithstanding the foregoing provisions of this paragraph:
(a) the Company and its Subsidiaries may in the ordinary
course of business and consistent with past practices, convey, sell, lease,
transfer, assign, or otherwise dispose of assets acquired and held for resale in
the ordinary course of business;
(b) the Company and its Subsidiaries may convey, sell, lease,
transfer or otherwise dispose of assets pursuant to and in accordance with the
limitation on mergers, sales or consolidations provisions in the Indenture;
(c) the Company and its Subsidiaries may sell damaged, worn
out or other obsolete property in the ordinary course of business so long as
such property is no longer necessary for the proper conduct of the business of
the Company or such Subsidiary, as applicable;
(d) in addition to assets sold pursuant to clauses (a), (b)
and (c), above, the Company and the Guarantors may convey, sell, lease,
transfer, assign, or otherwise dispose of assets to the extent that the
aggregate proceeds from all such Asset Sales does not exceed $500,000 in any
fiscal year..
SECTION 5.15 Maintenance of Consolidated Fixed Charges Coverage Ratio.
The Company shall maintain a Consolidated Fixed Charges Coverage Ratio,
as of the last day of each fiscal quarter ending after the Effective Date, of at
least 1.25 to 1 and shall furnish to the Trustee quarterly within the times for
delivery of annual and quarterly financial statements under Section 5.8 above an
Officers' Certificate setting forth the calculations of this ratio and stating
that the Company is in compliance with this covenant.
SECTION 5.16 Maintenance of Consolidated Net Worth.
The Company shall furnish to the Trustee quarterly within the times for
delivery of annual and quarterly financial statements under Section 5.8 above an
Officers' Certificate setting forth the Consolidated Net Worth of the Company at
the end of such fiscal quarter. The Company shall maintain Consolidated Net
Worth not less than an amount equal to its Consolidated Net Worth on the
Effective Date, less Five Million Dollars ($5,000,000.00).
SECTION 5.17 Limitation on Status as Investment Company.
None of the Company, any Guarantor, any Unrestricted Subsidiary or any
of their respective Subsidiaries shall become investment companies" (as that
term is defined in the Investment" Company Act of 1940, as amended), or
otherwise become subject to regulation under the Investment Company Act.
SECTION 5.18 Restrictions on Sale and Issuance of Subsidiary Stock.
The Company and each Guarantor shall not issue or sell, and shall not
permit any of their respective Subsidiaries to issue or sell, any shares of
Disqualified Capital Stock of any Subsidiary to any Person other than the
Company or a wholly owned Subsidiary of the Company.
SECTION 5.19 Additional Subsidiary Guarantors.
The Company and each Guarantor shall cause each of their respective
Subsidiaries created or acquired after the Effective Date to enter into a
supplemental Indenture for the purpose of jointly and severally guaranteeing,
subject only to any guarantee of the Senior Notes, the Company's obligations to
pay principal, premium and interest on the Notes.
ARTICLE VI
SUCCESSOR CORPORATION
SECTION 6.1 Limitation on Merger, Sale or Consolidation.
Neither the Company nor any of the Guarantors will consolidate with or
merge with or into another person or, directly or indirectly, sell, lease or
convey all or substantially all of its assets (computed on a consolidated
basis), whether in a single transaction or a series of related transactions, to
another Person or group of affiliated Persons, unless:
(1) either (a) the Company or such Guarantor, as the
case may be, is the continuing entity or (b) the resulting, surviving
or transferee entity is a corporation organized under the laws of the
United States, any state thereof or the District of Columbia and
expressly assumes by supplemental indenture all of the obligations of
the Company or the Guarantor, as the case may be, in connection with
the Notes and the Indenture;
(2) no Default or Event of Default shall exist
or shall occur immediately after giving effect to such transaction;
(3) immediately after giving effect to such
transaction, on a pro forma basis, the Consolidated Net Worth of the
surviving or transferee entity is at least equal to the Consolidated
Net Worth of the Company or the Guarantor, as the case may be,
immediately prior to such transaction;
(4) immediately after giving effect to such
transaction, on a pro forma basis, the surviving or transferee entity
would immediately thereafter be permitted to incur at least $1.00 of
additional Indebtedness pursuant to paragraph (a) of Section 5.11;
(5) such transaction will not result in the loss
of any Gaming License; and
(6) the Company has delivered to the Trustee an
Officers' Certificate stating that such consolidation, merger,
assignment, or transfer and such supplemental indenture comply with
this Article VI and that all conditions precedent herein provided
relating to such transaction have been satisfied.
For purposes of this Section, the Consolidated Fixed Charges Coverage
Ratio shall be determined on a pro forma consolidated basis (giving effect, on a
pro forma basis, to the transaction and any related incurrence of Indebtedness
or Disqualified Capital Stock) for the four fiscal quarters which ended
immediately preceding such transaction.
For purposes of the first sentence of Section 6.1, the sale, lease or
conveyance of all or substantially all of the properties and assets of one or
more Subsidiaries of the Company or a Guarantor, which properties and assets, if
held by the Company, or a Guarantor instead of such Subsidiaries, would
constitute all or substantially all of the properties and assets of the Company
or such Guarantor, as the case may be, on a consolidated basis, shall be deemed
to be the transfer of all or substantially all of the properties and assets of
the Company or such Guarantor, as the case may be.
SECTION 6.2 Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company or a Guarantor in accordance with
Section 6.1, the successor corporation formed by such consolidation or into
which the Company, such Guarantor or such Subsidiary, as the case may be, is
merged or to which such transfer is made, shall succeed to, and be substituted
for, and may exercise every right and power of, the Company or such Guarantor,
as the case may be, under the Indenture and the Notes with the same effect as if
such successor corporation had been named therein as the Company, such Guarantor
or such Subsidiary, as the case may be.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
SECTION 7.1 Events of Default.
"Event of Default," wherever used herein, means any one of the
following events occurring after the Effective Date (whatever the reason for
such Event of Default and whether it shall be caused voluntarily or
involuntarily or effected, without limitation, 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):
(1) the failure by the Company to pay any
installment of interest on the Notes as and when due and payable and the
continuance of any such failure for 30 days;
(2) the failure by the Company to pay all
or any part of the principal, or premium, if any, on the Notes when and as
the same become due and payable at maturity, redemption, by acceleration or
otherwise;
(3) except as provided in clauses (1) or (2) of this
Section 7.1, failure of the Company or any Guarantor to comply with any
provision of Article XII, which failure continues for 30 days;
(4) except as otherwise provided herein, the failure
by the Company or any Guarantor to observe or perform any other
covenant or agreement contained in the Notes or the Indenture and the
continuance of such failure for a period of 30 days after written
notice is given to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in aggregate principal amount of
the Notes outstanding;
(5) other than the Cases, a decree, judgment, or
order by a court of competent jurisdiction shall have been entered
adjudging the Company, any Guarantor or any of their Subsidiaries as
bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization of the Company, such Guarantor or any of such of
their Subsidiaries under any bankruptcy or similar law, and such decree
or order shall have continued undischarged and unstayed for a period of
60 days; or a decree or order of a court of competent jurisdiction over
the appointment of a receiver, liquidator, trustee, or assignee in
bankruptcy or insolvency of the Company, such Guarantor or any of such
of their Subsidiaries, or of the property of any such person, or for
the winding up or liquidation of the affairs of any such person, shall
have been entered, and such decree, judgment, or order shall have
remained in force undischarged and unstayed for a period of 60 days;
(6) other than the Cases, the Company, any Guarantor
or any of their Subsidiaries shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or answer or
consent seeking reorganization under any bankruptcy or similar law or
similar statute, or shall consent to the filing of any such petition,
or shall consent to the appointment of a Custodian, receivers
liquidator, trustee, or assignee in bankruptcy or insolvency of it or
any of its assets or property, or shall make a general assignment for
the benefit of creditors, or shall admit in writing its inability to
pay its debts generally as they become due, or shall, within the
meaning of any Bankruptcy Law, become insolvent, fails generally to pay
their debts as they become due, or takes any corporate action in
furtherance of or to facilitate, conditionally or otherwise, any of the
foregoing;
(7) a default in the payment of principal, premium
or interest when due which extends beyond any stated period of grace
applicable thereto or an acceleration for any other reason of maturity
of any Indebtedness of the Company or any of its Subsidiaries with an
aggregate principal amount in excess of $1 million;
(8) final unsatisfied judgments not covered by
insurance aggregating in excess of $1 million, at any one time rendered
against the Company or any of its Subsidiaries and not stayed, bonded
or discharged within 90 days;
(9) the closing of a substantial portion of
the Four Queens Casino for more than 90 consecutive days;
(10) the loss of the legal right to operate the Four
Queens Casino and such loss continuing for more than 90 consecutive
days, except any loss of legal right caused primarily by any holder of
the Notes (other than an Affiliate);
(11) an event of default specified in the Mortgage;
(12) the occurrence of any event giving any of the
Facility Lessors or sublessors the right to terminate any of the
Facility Leases, other than expiration of a Facility Lease according to
its terms; or
(13) an event of default specified in the Senior Note
Documents.
If a Default occurs and is continuing, the Trustee must, within 90 days
after the occurrence of such default, give to the Holders notice of such
default.
If an Event of Default occurs and is continuing (other than an Event of
Default specified in clause (4), above, relating to the Company or any of its
Subsidiaries), then in every such case, unless the principal of all of the Notes
shall have already become due and payable, either the Trustee or the Holders of
25% in aggregate principal amount of the Notes then outstanding, by notice in
writing to the Company, and to the Trustee if given by Holders (an "Acceleration
Notice"), may declare all principal and accrued interest thereon to be due and
payable immediately. If an Event of Default specified in clause (4), above,
relating to the Company or any of its Subsidiaries occurs, all principal and
accrued interest thereon will be immediately due and payable on all outstanding
Notes without any declaration or other act on the part of Trustee or the
Holders. The Holders of no less than a majority in aggregate principal amount of
Notes generally are authorized to rescind such acceleration if all existing
Events of Default, other than the non-payment of the principal or premium, if
any, and interest on the Notes which have become due solely by such
acceleration, have been cured or waived.
Prior to the declaration of acceleration of the maturity of the Notes,
the Holders of a majority in aggregate principal amount of the Notes at the time
outstanding may waive on behalf of all the Holders any default, except a default
in the payment of principal of or interest on any Note not yet cured, or a
default with respect to any covenant or provision which cannot be modified or
amended without the consent of the Holder of each outstanding Note affected.
Subject to the provisions of the Indenture relating to the duties of the
Trustee, the Trustee will be under no obligation to exercise any of its rights
or powers under the Indenture at the request, order or direction of any of the
Holders, unless such Holders have offered to the Trustee reasonable security or
indemnity. Subject to all provisions of the Indenture and applicable law, the
Holders of a majority in aggregate principal amount of the Notes at the time
outstanding will 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.
Notwithstanding the 30-day period and notice requirement contained in
Section 7.1(3) above, with respect to a default under Article XII the 30-day
period referred to in Section 7.1(3) shall be deemed to have begun as of the
date the Change of Control Notice is required to be sent in the event that the
Company has not complied with the provisions of Section 12.1, and the Trustee or
Holders of at least 25% in principal amount of the outstanding Securities
thereafter give the Notice of Default referred to in Section 7.1(3) to the
Company and, if applicable, the Trustee; provided, however, that if the breach
or default is a result of a default in the payment when due of the Change of
Control Offer Price on the Change of Control Payment Date, such default shall be
deemed, for purposes of this Section 7.1, to arise no later than on the Change
of Control Payment Date.
SECTION 7.2 Acceleration of Maturity Date; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 7.1(5) or (6)) occurs and is continuing, then, and in every such case,
unless the principal of all of the Securities shall have already become due and
payable, either the Trustee or the Holders of not less then 25% in aggregate
principal amount of then outstanding Securities, by a notice in writing to the
Company and Group (and to the Trustee if given by Holders) (an "Acceleration
Notice"), may declare all of the principal of the Securities (and premium, if
applicable), determined as set forth below, together with accrued interest
thereon, to be due and payable immediately. If an Event of Default specified in
Section 7.1(5) or (6) occurs, all principal of, premium applicable to, and
accrued interest on, the Securities shall be immediately due and payable on all
outstanding Securities without any declaration or other act on the part of the
Trustee or the Holders.
At any time after such a declaration of acceleration being made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter provided in this Article Seven, the Holders of a
majority in aggregate principal amount of then outstanding Securities, by
written notice to the Company and the Trustee, may waive, on behalf of all
Holders, an Event of Default or an event which with notice or lapse of time or
both would become an Event of Default if:
(1) the Company has paid or deposited with the
Trustee a sum sufficient to pay
(A) all overdue interest on all Securities,
(B) the principal of (and premium, if any,
applicable to) any Securities which would become due otherwise than by such
declaration of acceleration, and interest thereon at the rate borne by the
Securities,
(C) to the extent that payment of such
interest is lawful, interest upon overdue interest at the rate borne by the
Securities,
(D) all sums paid or advanced by the
Trustee hereunder and the compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and
(2) all Events of Default, other than the non-payment
of amounts which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 7.12.
Notwithstanding the previous sentence of this Section 7.2, no waiver shall be
effective for any Event of Default or event which with notice or lapse of time
or both would be an Event of Default with respect to any covenant or provision
which cannot be modified or amended without the consent of the Holder of each
outstanding Security, unless all such affected Holders agree, in writing, to
waive such Event of Default or event. No such waiver shall cure or waive any
subsequent default or impair any right consequent thereon.
SECTION 7.3 Collection of Indebtedness and Enforcement by Trustee.
The Company covenants that if an Event of Default in payment of
principal, premium, or interest specified in Section 7.1(1) and (2) occurs and
is continuing, the Company shall, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and payable
on such Securities for principal, premium (if any) and interest, and, to the
extent that payment of such interest shall be legally enforceable, interest on
any overdue principal (and premium, if any) and on any overdue 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
compensation to, and expenses, disbursements and advances of the Trustee, its
agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust in favor of the
Holders, may institute a judicial proceeding for the collection of the sums so
due and unpaid, may prosecute such proceeding to judgment or final decree and
may enforce the same against the Company or any other obligor upon the
Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any other obligor
upon the Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders either
(1) by such appropriate judicial proceedings as the
Trustee shall deem most effective to protect and enforce any such
rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy; or
(2) by exercise of any power of sale or other
remedies provided in the Mortgage, including the rights of a secured
creditor under the Uniform Commercial Code. In connection therewith,
Trustee may credit bid at any real or personal property foreclosure
sale in amounts deemed appropriate by Trustee in its sole discretion,
and may take ownership of any Collateral, either in its own name for
the benefit of the Holders, or in the name of a Nevada corporation
which Trustee may form; provided, that such corporation shall issue
voting stock to the Holders in such proportion as the unpaid principal
amounts of the Securities respectively held by each Holder bears to the
total outstanding principal amount of all Securities.
SECTION 7.4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, 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 on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise to take any and
all actions under the TIA, including
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) 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 the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agent and counsel) and
of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to distribute
the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding
is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 8.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment, or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 7.5 Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust in favor of the Holders, and any recovery of
judgment shall, after provision for the payment of compensation to, and
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
SECTION 7.6 Priorities.
Any money collected by the Trustee pursuant to this Article Seven shall
be applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal, premium
(if any) or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the Trustee in payment of all amounts due pursuant to
Section 8.7;
SECOND: To the Holders in payment of the amounts then due and unpaid
for principal of, premium (if any) and interest on, the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for principal, premium (if any) and interest,
respectively; and
THIRD: To whomsoever may be lawfully entitled thereto, the remainder,
if any.
SECTION 7.7 Limitation on Suits.
No Holder of any Security shall have any right to order or direct the
Trustee to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(A) such Holder has previously given written
notice to the Trustee of a continuing Event of Default;
(B) the Holders of not less than 25% in principal
amount of then outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(C) such Holder or Holders have offered to the
Trustee reasonable security or indemnity against the costs, expenses
and liabilities to be incurred or reasonably probable to be incurred in
compliance with such request;
(D) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any such
proceeding; and
(E) no direction inconsistent with such written
request has been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the outstanding
Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 7.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision of this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of' the principal of, and premium (if any) and interest on, such
Security on the Maturity Dates of such payments as expressed in such Security
(in the case of redemption, the Redemption Price on the applicable Redemption
Date, and in the case of the Change of Control Purchase Price, on the applicable
Change of Control Purchase Date) and to institute suit for the enforcement of
any such payment, and such rights shall not be impaired without the consent of
such Holder.
SECTION 7.9 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in Section 2.8, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders 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 hereafter 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.
SECTION 7.10 Delay or Omission Not Waiver.
No delay or omission by the Trustee or by any Holder of any Security to
exercise any right or remedy arising upon any Event of Default shall impair the
exercise of any such right or remedy or constitute a waiver of any such Event of
Default. Every right and remedy given by this Article Seven or by law to the
Trustee or to the Holders may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or by the Holders, as the case may be.
SECTION 7.11 Control by Holders.
The Holder or Holders of a majority in aggregate principal amount of
then outstanding Securities 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 upon the Trustee, provided, that
(1) such direction shall not be in conflict with any rule of law
or with this Indenture,
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Holders not taking part in such direction,
and
(3) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 7.12 Waiver of Past Default.
Subject to Section 7.8, the Holder or Holders of not less than a
majority in aggregate principal amount of the outstanding Securities may, by
written notice to the Trustee on behalf of all Holders, prior to the declaration
of the maturity of the Securities, waive any past default hereunder and its
consequences, except a default
(A) in the payment of the principal of, premium,
if any, or interest on, any Security as specified in clauses (1) and (2) of
Section 7.1, or
(B) in respect of a covenant or provision hereof
which, under Article X, cannot be modified or amended without the
consent of the Holder of each outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair the exercise of any right arising therefrom.
SECTION 7.13 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by
his 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 to be taken 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 7.13 shall not apply to any suit instituted
by the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
aggregate principal amount of the outstanding Securities, or to any suit
instituted by any Holder for enforcement of the payment of principal of, or
premium (if any) or interest on, any Security on or after the Maturity Date of
such Security.
SECTION 7.14 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Guarantor, the Trustee and
the Holders shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
ARTICLE VIII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
SECTION 8.1 Duties of Trustee.
(a) If a Default or an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture and use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the conduct
of his own affairs.
(b) Except during the continuance of a Default or an Event
of Default:
(1) The Trustee need perform only those duties as are
specifically set forth in this Indenture and no others, and no
covenants or obligations shall be implied in or read into this
Indenture which are adverse to the Trustee.
(c) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(1) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(2) This paragraph does not limit the effect of
paragraph (b) of this Section 8.1.
(d) The Trustee shall comply with any order or directive of a
Gaming Authority that the Trustee submit an application for any license, finding
of suitability or other approval pursuant to any Gaming Law and will cooperate
fully and completely in any proceeding related to such application.
(e) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(f) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 7.12.
(g) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or to take or omit to take any
action under this Indenture or at the request, order or direction of the Holders
or in the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b), (c), (e) and (g) of this
Section 8.1.
(i) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree in writing with the Company.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
SECTION 8.2 Rights of Trustee.
Subject to Section 8.1:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it, may
consult with counsel and may require an Officers' Certificate or an opinion of
Counsel, which shall conform to Sections 14.4 and 14.5. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit.
(f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Except with respect to Section 5.1, the Trustee shall have
no duty to inquire as to the performance of the Company's covenants in Article V
hereof. In Addition, the Trustee shall not be deemed to have knowledge of any
Default or Event of Default except (i) any Event of Default occurring pursuant
to Sections 7.1(1), 7.1(2) and 5.1, or (ii) any Default or Event of Default of
which the Trustee shall have received written notification or obtained actual
knowledge.
SECTION 8.3 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, any
Guarantor, any of their respective Subsidiaries, or their respective Affiliates
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights. However, the Trustee must comply with Sections 8.10 and
8.11.
SECTION 8.4 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities and it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities, other than the Trustee's
certificate of authentication, or the use or application of any funds received
by a Paying Agent other than the Trustee.
SECTION 8.5 Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Securityholder notice of
the uncured Default or Event of Default within 90 days after such Default or
Event of Default occurs. Except in the case of a Default or an Event of Default
in payment of Principal (or premium, if any) of, or interest on, any Security
(including the payment of the Change of Control Purchase Price on the Change of
Control Purchase Date and the Redemption Price on the Redemption Date), the
Trustee may withhold the notice if and so long as a Trust Officer in good faith
determines that withholding the notice is in the interest of the
Securityholders.
SECTION 8.6 Reports by Trustee to Holders.
If required by law, within 60 days after each May 15 beginning with the
May 15 following the date of this Indenture, the Trustee shall mail to each
Securityholder a brief report dated as of such May 15 that complies with TIA ss.
313(a). If required by law, the Trustee also shall comply with TIA xx.xx. 313(b)
and 313(c).
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any stock exchange or automatic quotation system.
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed.
SECTION 8.7 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents, accountants,
experts and counsel.
The Company shall indemnify the Trustee (in its capacity as Trustee)
and each of its officers, directors, attorneys-in-fact and agents for, and hold
it harmless against, any claim, demand, expense (including but not limited to
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel), loss or liability incurred by them without negligence or bad faith on
its part, arising out of or in connection with the administration of this trust
and their rights or duties hereunder including the reasonable costs and expenses
of defending themselves against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity. The Company shall defend the claim and the Trustee
shall provide reasonable cooperation at the Company's expense in the defense.
The Trustee may have separate counsel and the Company shall pay the reasonable
fees and expenses of such counsel; provided, that the Company will not be
required to pay such fees and expenses if it assumes the Trustee's defense and
there is no conflict of interest between the Company and the Trustee in
connection with such defense. The Company need not pay for any settlement made
without its written consent. The Company need not reimburse any expense or
indemnify against any loss or liability to the extent incurred by the Trustee
through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section 8.7, the
Trustee shall have a lien prior to the Securities on all assets held or
collected by the Trustee, in its capacity as Trustee, except assets held in
trust to pay principal and premium, if any, of or interest on particular
Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 7.1(5) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Company's obligations under this Section 8.7 and any lien arising
hereunder shall survive the resignation or removal of the Trustee, the discharge
of the Company's obligations pursuant to Article IX of this Indenture and any
rejection or termination of this Indenture under any Bankruptcy Law.
SECTION 8.8 Replacement of Trustee.
The Holder or Holders of a majority in principal amount of the
outstanding Securities may remove the Trustee by so notifying the Company and
the Trustee in writing and may appoint a successor Trustee.
The Company may remove the Trustee if: (1) the Trustee fails to comply
with Section 8.1(d) or 8.10; (2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver, Custodian, or other public officer takes charge of the Trustee
or its property; or (4) the Trustee becomes incapable of acting. The Trustee may
resign by so notifying the Company in writing. If the Trustee resigns, or is
removed by the Company, or if a vacancy exists in the office of Trustee for any
reason other than removal by the Holders, the Company shall promptly appoint a
successor Trustee. Within six (6) months after the successor Trustee takes
office, the Holder or Holders of a majority in principal amount of the
Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the Trustee provided for in Section 8.7 have
been paid, the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided in Section 8.7,
the resignation or removal of the retiring Trustee shall become effective, and
the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holder or Holders of at least 10% 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 8.10, 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
8.8, the Company's obligations under Section 8.7 shall continue for the benefit
of the retiring Trustee.
SECTION 8. 9 Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such. resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
SECTION 8.10 Eligibility; Disqualification.
The Trustee shall at all times satisfy the requirements of TIA ss.
310(a)(1) and TIA ss. 310(a)(5). The Trustee shall have a combined capital and
surplus of at least $25,000,000 as set forth in its most recent published annual
report of condition. The Trustee shall comply with TIA 9 310(b).
SECTION 8.11 Preferential Collection of Claims against Company.
The Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated.
ARTICLE IX
SATISFACTION AND DISCHARGE
SECTION 9.1 Satisfaction and Discharge of the Indenture.
The Company shall be deemed to have paid and discharged the entire
Indebtedness on the Securities and the provisions of this Indenture shall cease
to be of further effect (subject to Section 9.3), if:
(1) The Company irrevocably deposits in trust with
the Trustee, pursuant to an irrevocable trust and security agreement in
form and substance reasonably satisfactory to the Trustee, (i) U.S.
Legal Tender, (ii) U.S. Government Obligations, or (iii) a combination
thereof, in an amount after payment of all Federal, state and local
taxes or other charges or assessments in respect thereof payable by the
Trustee, which through the payment of principal and interest will
provide, not later than one Business Day before the due date of payment
in respect of the Securities, U.S. Legal Tender in an amount which, in
the opinion of a nationally recognized firm of independent certified
public accountants expressed in a written certification thereof (in
form and substance reasonably satisfactory to the Trustee) delivered to
the Trustee, is sufficient to pay the principal of, premium, if any,
and each installment of principal and interest on the Securities then
outstanding on the dates on which any such payments are due and payable
in accordance with the terms of this Indenture and of the Securities;
(2) Such deposits shall not cause the Trustee to
have a conflicting interest as defined in and for purposes of the TIA;
(3) No Default or Event of Default shall have
occurred or be continuing on the date of such deposit or shall occur on
or before the 91st day (or one day after such other greater period of
time in which any such deposit of trust funds may remain subject to
bankruptcy or insolvency laws) after the date of such deposit, and such
deposit will not result in a Default or Event of Default under this
Indenture or a breach or violation of, or constitute a default under,
any other instrument to which the Company, any Guarantor or any
Subsidiary of the Company or any Guarantor is a party or by which it or
its property is bound;
(4) The deposit, defeasance and discharge will not be
deemed, or result in, a Federal income taxable event to the Holders of
the Securities and the Holders will be subject to Federal income tax
only in the same amounts and in the same manner and at the same times
as would have been the case if such deposit and defeasance had not
occurred;
(5) The deposit shall not result in the Company,
the Trustee or the trust becoming an "investment company" under the
Investment Company Act of 1940;
(6) After the passage of 91 days (or any greater
period of time in which any such deposit of trust funds may remain
subject to Bankruptcy Laws insofar as those laws apply to the Company)
following the deposit of the trust funds, such funds will not be
subject to any Bankruptcy Laws affecting creditors' rights generally;
(7) Holders of the Securities will have a
valid, perfected and unavoidable first-priority security interest in
the trust funds; and
(8) The Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel (who may be outside
Counsel to the Company, but not in-house counsel to the Company or any
of its Subsidiaries), each in form and substance satisfactory to the
Trustee, stating that all conditions precedent specified herein
relating to the defeasance contemplated by this Section 9.1 have been
complied with.
In the event all or any portion of the Securities are to be redeemed
through such irrevocable trust, the Company must make arrangements satisfactory
to the Trustee, at the time of such deposit, for the giving of the notice of
such redemption or redemptions by the Trustee in the name and at the expense of
the Company.
In the event that the Company takes the necessary action to comply with
the Provisions described in this Section 9.1 and the Securities are declared due
and payable because of the occurrence of an Event of Default, the Company will
remain liable for all amounts due on the Securities at the time of acceleration
resulting from such Event of Default in excess of the amount of money and U.S.
obligations deposited with the Trustee pursuant to this Section 9.1 at the time
of such acceleration.
SECTION 9.2 Termination of Obligations Upon Cancellation of the Securities.
In addition to the Company's rights under Section 9.1, the Company and
the Guarantors may terminate all of their obligations under this Indenture
(subject to Section 9.3) when:
(1) all Securities theretofore authenticated and
delivered (other than Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section 2.8)
have been delivered to the Trustee for cancellation;
(2) the Company or a Guarantor has paid or
caused to be paid all sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an
Officers' Certificate and an opinion of Counsel who may be outside
counsel to the Company, but not in-house counsel to the Company or any
of its Subsidiaries, each stating that all conditions precedent
specified herein relating to the satisfaction and discharge of this
Indenture have been complied with and that such satisfaction and
discharge will not result in a breach or violation of, or constitute a
Default under, this Indenture or any other instrument to which the
Company, any Guarantor or any of their Subsidiaries is a party or by
which it or their property is bound.
SECTION 9.3 Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this Indenture and of
the Securities referred to in Section 9.1 or 9.2, the respective obligations of
the Company, the Guarantors and the Trustee under Sections 2.3, 2.4, 2.5, 2.6,
2.7, 2.8, 2.12, 2.13, Article III, Article IV, 5.1, 5.2, 5.4, 5.6, 5.19, 7.7,
7.8, 8.7, 8.8, 9.5, 9.6, 9.7, 14.l, 14.2, 14.4, 14.5, 14.7, 14.8, 14.11 and this
Section 9.3 shall survive until the Securities are no longer outstanding, and
thereafter the obligations of the Company and the Trustee under Sections 7.8,
8.7, 8.8, 9.5, 9.6, 9.7, 14.11 and this Section 9.3 shall survive. Nothing
contained in this Article IX shall abrogate any of the obligations or duties of
the Trustee under this Indenture.
SECTION 9.4 Acknowledgment of Discharge by Trustee.
After (i) the conditions of Section 9.1 or 9.2 have been satisfied,
(ii) the Company or a Guarantor has paid or caused to be paid all other sums
payable hereunder by the Company and (iii) the Company has delivered to the
Trustee an Officers' Certificate and an opinion of Counsel, each stating that
all conditions precedent referred to in clause (i), above, relating to the
satisfaction and discharge of this Indenture have been complied with, the
Trustee upon request shall acknowledge in writing the discharge of the Company's
and the Guarantors' obligations under this Indenture except for those surviving
obligations specified in Section 9.3.
SECTION 9.5 Application of Trust Assets.
The Trustee shall hold any U.S. Legal Tender or U.S. Government
obligations deposited with it in the irrevocable trust established pursuant to
Section 9.1. The Trustee shall apply the deposited U.S. Legal Tender or U.S.
Government Obligations, together with earnings thereon, through the Paying Agent
(which may not for purposes of Article IX be the Company or any Affiliate of the
Company), in accordance with this Indenture and the terms of the Securities, to
the payment of principal of and interest on the Securities.
SECTION 9.6 Repayment to the Company.
Upon termination of the trust established pursuant to Section 9.1 by
payment of the trust property to the Holders, the Trustee and the Paying Agent
shall promptly pay to the Company upon request any excess U.S.
Legal Tender or U.S. Government Obligations held by them.
The Trustee and the Paying Agent shall pay to the Company upon request,
and, if applicable, in accordance with the irrevocable trust established
pursuant to Section 9.1, any U.S. Legal Tender or U.S. Government Obligations
held by them for the payment of principal of or interest on the Securities that
remain unclaimed for two years after the date on which such payment shall have
become due; provided, however, that the Trustee or such Paying Agent, before
being required to make any such repayment, may, at the expense of the Company,
cause to be published once, in a newspaper 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 shall be repaid
to the Company. After payment to the Company, Holders entitled to such payment
must look to the Company for such payment as general creditors unless an
applicable abandoned property law designates another person.
SECTION 9.7 Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender
or U.S. Government obligations in accordance with Section 9.1 or 9.2 by reason
of any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 9.1 or 9.2 until such time as the Trustee or Paying Agent is permitted
to apply all such U.S. Legal Tender or U.S. Government Obligations in accordance
with Section 9.1 or 9.2; provided, however, that if the Company or a Guarantor
has made any payment of principal of, premium, if any, or interest on any
Securities because of the reinstatement of its obligations, the Company or such
Guarantor shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the U.S. Legal Tender or U.S. Government Obligations
held by the Trustee or Paying Agent.
ARTICLE X
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.1 Supplemental Indentures Without Consent of Holders.
Without the consent of any Holder, the Company or any Guarantor, when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, or may amend,
modify or supplement the Mortgage, in form satisfactory to the Trustee, for any
of the following purposes:
(1) to cure any ambiguity, defect, or inconsistency,
or to make any other provisions with respect to matters or questions
arising under this Indenture which shall not be inconsistent with the
provisions of this Indenture, provided such action pursuant to this
clause (1) shall not adversely affect the interests of any Holder in
any respect.
(2) to add to the covenants of the Company for the
benefit of the Holders, or to surrender any right or power herein
conferred upon the Company or to make any other change that does not
adversely affect the rights of any Holder; provided, that the Company
has delivered to the Trustee an Opinion of Counsel stating that such
change does not adversely affect the rights of any Holder;
(3) to provide for additional collateral for
or additional Guarantors of the Securities;
(4) to provide for uncertificated Securities
in addition to or in place of certificated Securities;
(5) to evidence the succession of another person to
the Company, and the assumption by any such successor of the
obligations of the Company, herein and in the Securities in accordance
with Article VI;
(6) to comply with the TIA; or
(7) to comply with any order of any Gaming Authority.
SECTION 10.2 Amendments, Supplemental Indentures and Waivers
with Consent of Holders.
Subject to Section 7.8, with the consent of the Holders of a majority
in aggregate principal amount of then outstanding Securities, by written act of
said Holders delivered to the Company and the Trustee, the Company and any
Guarantor, when authorized by Board Resolutions, and the Trustee may amend or
supplement the Mortgage, this Indenture or the Securities or enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Mortgage, this Indenture or the Securities or of modifying in any manner the
rights of the.. Holders under the Mortgage, this Indenture or the Securities.
Subject to Section 7.8, the Holder or Holders of a majority, in principal amount
of then outstanding Securities may waive compliance by the Company or any
Guarantor with any provision of the mortgage, this Indenture or the Securities.
Notwithstanding the foregoing provisions of this Section 10.2, no such
amendment, supplemental indenture or waiver shall, without the consent of the
Holders of 66-2/3% of the aggregate principal amount of outstanding Securities,
change any provision of Article XII, Article XIII, Article IV, Section 5.19 or
(except for the Stated Maturity which is governed by clause (4) below) extend
any Maturity Date of any Security, and no such amendment, supplemental indenture
or waiver shall, without the consent of the Holder of each outstanding Security
affected thereby:
(1) change the percentage of principal amount of
Securities whose Holders must consent to an amendment, supplement or
waiver of any provision of this Indenture or the Securities;
(2) reduce the rate or extend the time for
payment of interest on any Security;
(3) reduce the principal amount of any Security;
(4) change the Stated Maturity of any Security;
(5) alter the redemption provisions of
Article III in a manner adverse to any Holder;
(6) make any changes in the provisions concerning
waivers of Defaults or Events of Default by Holders of the Securities
or the rights of Holders to recover the principal or premium of,
interest on, or redemption payment with respect to, any Security;
(7) make any changes in Section 7.4, 7.7 or
this third sentence of this Section 10.2;
(8) make the principal of, or the interest on, any
Security payable with anything or in any manner other than as provided
for in this Indenture and the Securities as in effect on the date
hereof;
(9) make the Securities subordinated in right
of payment to any extent or under any circumstances to any other
indebtedness; or
(10) to comply with any order of a Gaming Authority.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
After an amendment, supplement or waiver under this Section 10.2 or
10.4 becomes effective, it shall bind each Holder.
In connection with any amendment, supplement or waiver under this
Article X, the Company may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment, supplement or waiver.
SECTION 10.3 Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
SECTION 10.4 Revocation and Effect of Consents.
---------------------------------
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by written notice to the
Company or the person designated by the Company as the person to whom consents
should be sent if such revocation is received by the Company or such person
before the date on which the Trustee receives an Officers, Certificate
certifying that the Holders of the requisite principal amount of Securities have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be the date so fixed by the
Company notwithstanding the provisions of the TIA. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those persons who were Holders at such record date, and only those persons (or
their duly designated proxies), shall be entitled 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.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (9) of Section 10.2, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security; provided, that any such
waiver shall not impair or affect the right of any Holder to receive payment of
principal and premium of and interest on a Security, on or after the respective
dates set for such amounts to become due and payable expressed in such Security,
or to bring suit for the enforcement of any such payment on or after such
respective dates.
SECTION 10.5 Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee
or require the Holder to put an appropriate notation on the Security. The
Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue, the
Guarantors shall endorse and the Trustee shall authenticate a new Security that
reflects the changed terms. Any failure to make the appropriate notation or to
issue a new Security shall not affect the validity of such amendment, supplement
or waiver.
SECTION 10.6 Trustee to Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article X provided, that the Trustee may, but shall
not be obligated to, execute any such amendment, supplement or waiver which
affects the Trustee's own rights, duties or immunities under this Indenture. The
Trustee shall be entitled to receive, and shall be fully protected in relying
upon, an opinion of Counsel stating that the execution of any amendment,
supplement or waiver authorized pursuant to this Article X is authorized or
permitted by this Indenture.
ARTICLE XI
MEETINGS OF SECURITYHOLDERS
SECTION 11.1 Purposes for Which Meetings May Be Called.
A meeting of Securityholders may be called at any time and from time to
time pursuant to the provisions of this Article XI for any of the following
purposes:
(a) to give any notice to the Company, any Guarantor or to the
Trustee, or to give any directions to the Trustee, or to waive or to consent to
the waiving of any Default or Event of Default hereunder and its consequences,
or to take any other action authorized to be taken by Securityholders pursuant
to any of the provisions of Article VII;
(b) to remove the Trustee or appoint a successor Trustee
pursuant to the provisions of Article VIII;
(c) to consent to an amendment, supplement or waiver
pursuant to the provisions of Section 10.2; or
(d) to take any other action (i) authorized to be taken by or
on behalf of the Holder or Holders of any specified aggregate principal amount
of the Securities under any other provision of this Indenture, or authorized or
permitted by law or (ii) which the Trustee deems necessary or appropriate in
connection with the administration of this Indenture.
SECTION 11.2 Manner of Calling Meetings.
The Trustee may at any time call a meeting of Securityholders to take
any action specified in Section 11.1, to be held at such time and at such place
in The City of New York, State of New York or elsewhere as the Trustee shall
determine. Notice of every meeting of Securityholders, setting forth the time
and place of such meeting and in general terms the action proposed to be taken
at such meeting, shall be mailed by the Trustee, first-class postage prepaid, to
the Company, the Guarantors and to the Holders at their last addresses as they
shall appear on the registration books of the Registrar, not less than 10 nor
more than 60 days prior to the date fixed for a meeting. The Company shall pay
the costs and expenses of preparing and mailing such notice.
Any meeting of Securityholders shall be valid without notice if the
Holders of all Securities then outstanding are present in person or by proxy, or
if notice is waived before or after the meeting by the Holders of all Securities
outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.
SECTION 11.3 Call of Meetings by Company or Holders.
In case at any time the Company, pursuant to a Board Resolution, or the
Holders of not less than 10% in aggregate principal amount of the Securities
then outstanding, shall have requested the Trustee to call a meeting of
Securityholders to take any action specified in Section 11.1, by written request
setting forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have mailed the notice of such meeting within
20 days after receipt of such request, then the Company or the Holders of
Securities in the amount above specified may determine the time and place in The
City of New York, State of New York or elsewhere for such meeting and may call
such meeting for the purpose of taking such action, by mailing or causing to be
mailed notice thereof as provided in Section 11.2, or by causing notice thereof
to be published at least once in each of two successive calendar weeks (on any
Business Day during such week) in a newspaper or newspapers printed in the
English language, customarily published at least five days a week of a general
circulation in The City of New York, State of New York, the first such
publication to be not less than 10 nor more than 60 days prior to the date fixed
for the meeting.
SECTION 11.4 Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Securityholders, a person
shall (a) be a registered Holder of one or more Securities, or (b) be a Person
appointed by an instrument in writing as proxy for the registered Holder or
Holders of Securities. The only persons who shall be entitled to be present or
to speak at any meeting of Securityholders shall be the persons entitled to vote
at such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company, the Guarantors and their
counsel.
SECTION 11.5 Regulations May Be Made by Trustee, Conduct
of the Meeting; Voting Rights; Adjournment.
Notwithstanding any other provision of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any action by or
any meeting of Securityholders, in regard to proof of the holding of Securities
and of the appointment of proxies, and in regard to the appointment and duties
of inspectors of votes, and submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think appropriate. Such regulations may fix a
record date and time for determining the Holders of record of Securities
entitled to vote at such meeting, in which case those and only those persons who
are Holders of Securities at the record date and time so fixed, or their
proxies, shall be entitled to vote at such meeting whether or not they shall be
such Holders at the time of the meeting.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 11.3, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by vote of the Holders of a majority
in principal amount of the Securities represented at the meeting and entitled to
vote.
At any meeting each Securityholder or proxy shall be entitled to one
vote for each $1,000 principal amount of Securities held or represented by him;
provided, however, that no vote shall be cast or counted at any meeting in
respect of any Securities challenged as not outstanding and ruled by the
chairman of the meeting to be not then outstanding. The chairman of the meeting
shall have no right to vote other than by virtue of Securities held by him or
instruments in writing as aforesaid duly designating him as the proxy to vote on
behalf of other Securityholders. Any meeting of Securityholders duly called
pursuant to the provisions of Section 11.2 or Section 11.3 may be adjourned from
time to time by vote of the Holder or Holders of a majority in aggregate
principal amount of the Securities represented at the meeting and entitled to
vote, and the meeting may be held as so adjourned without further notice.
SECTION 11.6 Voting at the Meeting and Record to Be Kept.
The vote upon any resolution submitted to any meeting of
Securityholders shall be by written ballots on which shall be subscribed the
signatures of the Holders of Securities or of their representatives by proxy and
the principal amount of the Securities voted by the ballot. The permanent
chairman of the meeting shall appoint two inspectors of votes, who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record in duplicate of the
proceedings of each meeting of Securityholders shall be prepared by the
secretary of the meeting and there shall be attached to such record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts, setting forth a
copy of the notice of the meeting and showing that such notice was mailed as
provided in Section 11.2 or published as provided in Section 11.3. The record
shall be signed and verified by the affidavits of the permanent chairman and the
secretary of the meeting and one of the duplicates shall be delivered to the
Company and the other to the Trustee to be preserved by the Trustee, the latter
to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
SECTION 11.7 Exercise of Rights of Trustee or Securityholders
May Not Be Hindered or Delayed by Call of Meeting.
Nothing contained in this Article XI shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Securityholders or
any rights expressly or impliedly conferred hereunder to make such call, any
hindrance or delay in the exercise of any right or rights conferred upon or
reserved to the Trustee or to the Securityholders under any of the provisions of
this Indenture or of the Securities.
ARTICLE XII
RIGHT TO REQUIRE REPURCHASE
SECTION 12.1 Repurchase of Securities at Option of the Holder
Upon Change of Control.
(a) In the event that a Change of Control occurs, each Holder
of Securities shall have the right, at such Holder's option, subject to the
terms and conditions of the Indenture, to require the Company to repurchase all
or any part of such Holder's Notes (provided, that the principal amount of such
Notes at maturity must be $1,000 or an integral multiple thereof) on the date
that is no later than 30 Business Days after the occurrence of such Change of
Control (the "Change of Control Payment Date"), at a cash price (the "Change of
Control Purchase Price") equal to 101% of the principal amount thereof, plus
accrued and unpaid interest, if any, to and including the Change of Control
Payment Date.
(b) Within 7 Business Days after the occurrence of a Change of
Control, the Company shall make an unconditional, irrevocable offer (a "Change
of Control Offer") to the Holders to purchase for U.S. Legal Tender all of the
Securities pursuant to the offer described in clause (c) of this Section 12.1 at
the Change of Control Purchase Price. Within 5 Business Days after each date
upon which a Change of Control shall occur requiring the Company to make a
Change of Control Offer pursuant to this Section 12.01, the Company shall so
notify the Trustee.
(c) Notice of a Change of Control Offer shall be sent, at
least 20 Business Days prior to the Final Change of Control Put Date (as defined
below), by first class mail, by the Company to each Holder at its registered
address, with a copy to the Trustee. The notice to the Holders shall contain all
instructions and materials required by applicable law and shall contain or make
available to Holders other information material to such Holders, decision to
tender Securities pursuant to the Change of Control Offer. The notice, which (to
the extent consistent with this Indenture) shall govern the terms of the offer,
shall state:
(1) that the Change of Control offer is being made
pursuant to this Section 12.1 and that all Securities, or portions
thereof, tendered will be accepted for payment;
(2) the Change of Control Purchase Price (including
the amount of accrued and unpaid interest), the Change of Control
Payment Date and the Change of Control Put Date (as defined below);
(3) that any Security, or portion thereof, not
tendered or accepted for payment will continue to accrue interest;
(4) that, unless the Company defaults in depositing
U.S. Legal Tender with the Paying Agent in accordance with the last
paragraph of this clause (c), or such payment is prevented for any
reason, any Security, or portion thereof, accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest after the
Change of Control Payment Date;
(5) that Holders electing to have a Security, or
portion thereof, purchased pursuant to a Change of Control Offer will
be required to surrender the Security, with the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Security completed,
to the Paying Agent (which may not for purposes of this Section 12.1,
notwithstanding anything in this Indenture to the contrary, be the
Company or any Affiliate of the Company) at the address specified in
the notice prior to the close of business on the third Business Day
prior to the Change of Control Payment Date (the "Change of Control Put
Date");
(6) that Holders will be entitled to withdraw their
election, in whole or in part, if the Paying Agent receives, prior to
the close of business on the Change of Control Put Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Securities the Holder is
withdrawing and a statement that such Holder is withdrawing his
election to have such principal amount of Securities purchased; and
(7) a brief description of the events resulting
in such Change of Control.
Any such Change of Control Offer shall comply with all applicable
provisions of Federal and state laws, including these regulating tender offers,
if applicable, and any provisions of this Indenture which conflict with such
laws shall be deemed to be superseded by the provisions of such laws. On or
before the Change of Control Payment Date, the Company shall (i) accept for
payment Securities or portions thereof properly tendered pursuant to the Change
of Control Offer prior to the close of business on the Final Change of Control
Put Date, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Change of Control Purchase Price (including accrued and unpaid interest) of
all Securities so tendered and (iii) deliver to the Trustee Securities so
accepted together with an Officers, Certificate listing the Securities or
portions thereof being purchased by the Company. The Paying Agent shall on the
Change of Control Payment Date mail to the Holders of Securities so accepted
payment in an amount equal to the Change of Control Purchase Price (including
accrued and unpaid interest), and the Trustee shall promptly authenticate and
mail or deliver to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered. Any Securities not so accepted
shall be promptly mailed or delivered by the Company to the Holder thereof.
ARTICLE XIII
GUARANTY
SECTION 13.1 Guaranty.
(a) In consideration of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, each of the Guarantors
hereby unconditionally guarantees (the "Guaranty") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Securities or the obligations of the Company under this Indenture or the
Securities, that: (w) the principal and premium (if any) of and interest on the
Securities will be paid in full when due, whether at the maturity or interest
payment date, by acceleration, call for redemption, upon a Change of Control, or
otherwise, and interest on the overdue principal and premium and interest, if
any, of the Securities, if lawful; (x) all other obligations of the Company to
the Holders or the Trustee under this Indenture or the Securities will be
promptly paid in full or performed, all in accordance with the terms of this
Indenture and the Securities; and (y) in case of any extension of time of
payment or renewal of any Securities or any of such other obligations, they will
be paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at maturity, by acceleration, call for redemption,
upon a Change of Control Offer or otherwise. Failing payment when due of any
amount so guaranteed for whatever reason, each Guarantor shall be obligated to
pay the same before failure so to pay becomes an Event of Default.
(b) Each Guarantor hereby agrees that its obligations with
regard to this Guaranty shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence of
any action to enforce the same, any delays in obtaining or realizing upon or
failures to obtain or realize upon collateral, the recovery of any judgment
against the Company, any action to enforce the same or any other circumstances
that might otherwise constitute a legal or equitable discharge or defense of a
guarantor. Each Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company or
right to require the prior disposition of the assets of the Company to meet its
obligations, protest, notice and all demands whatsoever and covenants that this
Guaranty will not be discharged except by complete performance of the
obligations contained in the Securities and this Indenture.
(c) If any Holder or the Trustee is required by any court or
otherwise to return to either the Company or any Guarantor, or any Custodian,
Trustee, or similar official acting in relation to either the Company or such
Guarantor, any amount paid by either the Company or such Guarantor to the
Trustee or such Holder, this Guaranty, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor agrees that it will
not be entitled to any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby. Each Guarantor further agrees that, as between
such Guarantor, on the one hand, and the Holders and the Trustee, on the other
hand, (i) the maturity of the obligations guaranteed hereby may be accelerated
as provided in Section 7.2 for the purposes of this Guaranty, notwithstanding
any stay, injunction or other prohibition preventing such acceleration as to the
Company of the obligations guaranteed hereby, and (ii) in the event of any
declaration of acceleration of those obligations as provided in Section 7.2,
those obligations (whether or not due and payable) will forthwith become due and
payable by each of the Guarantors for the purpose of this Guaranty.
(d) It is the intention of each Guarantor and the Company that
the obligations of each Guarantor hereunder shall be in, but not in excess of,
the maximum amount permitted by applicable law. Accordingly, if the obligations
in respect of the Guaranty would be annulled, avoided or subordinated to the
creditors of any Guarantor by a court of competent jurisdiction in a proceeding
actually pending before such court as a result of a determination both that such
Guaranty was made without fair consideration and, immediately after giving
effect thereto, such Guarantor was insolvent or unable to pay its debts as they
mature or left with an unreasonably small capital, then the obligations .of such
Guarantor under such Guaranty shall be reduced by such court if such reduction
would result in the avoidance of such annulment, avoidance or subordination;
provided, however, that any reduction pursuant to this paragraph shall be made
in the smallest amount as is strictly necessary to reach such result. For
purposes of this paragraph, "fair consideration", "insolvency", "unable to pay
its debts as they mature", "unreasonably small capital" and the effective times
of reductions, if any, required by this paragraph shall be determined in
accordance with applicable law.
SECTION 13.2 Execution and Delivery of Guaranty.
----------------------------------
To evidence its Guaranty set forth in Section 13.1, each Guarantor
agrees that a notation of such Guaranty substantially in the form annexed hereto
as Exhibit C shall be endorsed on each Security authenticated and delivered by
the Trustee and that this Indenture shall be executed on behalf of such
Guarantor by two officers or an officer and an Assistant Secretary by manual or
facsimile signature.
Each Guarantor agrees that its Guaranty set forth in Section 13.1 shall
remain in full force and effect and apply to all the Securities notwithstanding
any failure to endorse on each Security a notation of such Guaranty.
If an officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security on which a Guaranty is
endorsed, the Guaranty shall be valid nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guaranty set forth in
this Indenture on behalf of each Guarantor.
SECTION 13.3 Future Guarantors.
The Company and the Guarantors covenant and agree that they shall cause
each person that is or becomes a Subsidiary of the Company or any Guarantor to
execute a Guaranty in the form of Exhibit C to this Indenture and will and cause
such Subsidiary to execute an Indenture supplemental hereto for the purpose of
adding such Subsidiary as a Guarantor hereunder and the capital stock of such
Subsidiary shall be pledged, pursuant to an agreement substantially in form of
the Pledge Agreement, in favor of the Trustee for the benefit of the Holders.
SECTION 13.4 Certain Bankruptcy Events.
Each Guarantor hereby covenants and agrees that in the event of the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Company, such Guarantor shall not file (or join in any filing of), or otherwise
seek to participate in the filing of, any motion or request seeking to stay or
to prohibit (even temporarily) execution on the Guaranty and hereby waives and
agrees not to take the benefit of any such stay of execution, whether under
Section 362 or 105 of the United States Bankruptcy Code or otherwise.
ARTICLE XIIIV
MISCELLANEOUS
SECTION 14.1 TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
the duties imposed by operation of the TIA, the imposed duties, upon
qualification of this Indenture under the TIA, shall control.
SECTION 14.2 Notices.
Any notices or other communications to the Company, the Guarantors or
the Trustee required or permitted hereunder shall be in writing, and shall be
sufficiently given if made by hand delivery, by telex, by telecopier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Company:
with a copy to:
Xxxxxx & Silver, Ltd.
0000 Xxxxxx Xxxxxx Xxxxxxx, 00xx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
if to the Guarantors:
if to the Trustee:
First Trust National Association
000 X. 0xx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
The Company, the Guarantors or the Trustee by notice to each other
party may designate additional or different addresses as shall be furnished in
writing by such party. Any notice or communication to the Company, the
Guarantors or the Trustee shall be deemed to have been given or made as of the
date so delivered, if personally delivered; when answered back, if telexed; when
receipt is acknowledged, if telecopied; and 5 Business Days after mailing if
sent by registered or certified mail, postage prepaid (except that a notice of
change of address shall not be deemed to have been given until actually received
by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 14.3 Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss.312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Guarantors, the Trustee, the Registrar and any
other person shall have the protection of TIA ss. 312(c).
SECTION 14.4 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of
the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an opinion of Counsel (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
SECTION 14.5 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the person making such
certificate or opinion has read such covenant or condition;
(2) 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;
(3) 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 condition has been complied with; and
(4). a statement as to whether or not, in the opinion
of each such person, such condition or covenant has been complied with;
provided, however, that with respect to matters of fact an opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
SECTION 14.6 Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for its
functions.
SECTION 14.7 Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment is
a Saturday, a Sunday or a day on which banking institutions in New York, New
York are not required to be open. If a payment date is a Legal Holiday in New
York, New York, payment may be made at such place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period.
SECTION 14.8 Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. THE COMPANY AND EACH GUARANTOR HEREBY IRREVOCABLY SUBMIT TO
THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN
IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN
IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS INDENTURE AND THE SECURITIES, AND IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
JURISDICTION OF THE AFORESAID COURTS. THE COMPANY AND EACH GUARANTOR IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW,
TRIAL BY JURY AND ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING HEREIN SHALL AFFECT THE
RIGHT OF THE TRUSTEE OR ANY SECURITYHOLDER TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE COMPANY IN ANY OTHER JURISDICTION.
SECTION 14.9 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Company, the Guarantors or any of their
Subsidiaries. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 14.10 No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as such, of
the Company or the Guarantors shall not have any liability for any obligations
of the Company or the Guarantors under the Securities or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creations. Each Securityholder by accepting a Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
SECTION 14.11 Successors.
All agreements of the Company and the Guarantors in this Indenture and
the Securities shall bind their successors. All agreements of the Trustee in
this Indenture shall bind its successor.
SECTION 14.12 Duplicate Originals.
All parties may sign any number of copies or counterparts of this
Indenture. Each signed copy or counterpart shall be an original, but all of them
together shall represent the same agreement.
SECTION 14.13 Severability.
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
SECTION 14.14 Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table and headings of the
Articles and the Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
SIGNATURE
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the date first written above.
ELSINORE CORPORATION
By: ______________________________
Name:
Title:
Attest: ______________________
FIRST TRUST NATIONAL ASSOCIATION, as Trustee
By: ______________________________
Name:
Title:
Attest: ______________________
GUARANTORS:
ELSUB CORPORATION
By: ______________________________
Name:
Title:
FOUR QUEENS, INC.
By: ______________________________
Name:
Title:
PALM SPRINGS EAST, LIMITED
PARTNERSHIP
BY: ELSUB MANAGEMENT CORPORATION,
its general partner
By: ______________________________
Name:
Title:
EXHIBITS
Exhibit A - Conditions to Effectiveness of Amended and
Restated Indenture
Exhibit B - Form of Amended and Restated Note
Exhibit C - Form of Guaranty
A-1
EXHIBIT A
CONDITIONS TO EFFECTIVENESS OF
AMENDED AND RESTATED INDENTURE
The foregoing Amended and Restated Indenture shall be effective on the
Effective Date (as defined in the Order) and upon receipt by the Trustee of each
of the following documents, each duly executed by the parties thereto other than
the Trustee:
1. Amended and Restated Indenture;
2. Modification of Subordinated Deed of Trust executed in
recordable form and recordation thereof in the Official
Records of Xxxxx County, Nevada;
3. Amendment of 1993 Pledge Agreement;
4. Termination of Disbursement and Escrow Agreement; and
5. The Title Policy, subject only to the deed of trust
securing the Senior Notes and other exceptions acceptable
to Trustee.
EXHIBIT B
[FORM OF AMENDED AND RESTATED NOTE]
ELSINORE CORPORATION
13 1/2% SECOND MORTGAGE NOTE
DUE 2001
No. $
Elsinore Corporation, a Nevada corporation (hereinafter called the
"Company," which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
________________ or registered assigns, the principal sum of ______________
Dollars, on August 20, 2001.
Interest Payment Dates: February 28 and August 31.
Record Dates: February 15 and August 15.
Reference is made to the further provisions of this Security on the
reverse side, which will, for all purposes, have the same effect as if set forth
at this place.
IN WITNESS WHEREOF, the Company has caused this Instrument to be duly
executed under its corporate seal.
Dated: March 3, 1997.
ELSINORE CORPORATION
By: __________________________
Attest:
---------------------
Secretary
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-mentioned
Indenture.
------------------------------
First Trust National Association,
as Trustee
By: ___________________________
Authorized Signatory
Dated: March 3, 1997.
ELSINORE CORPORATION
13 1/2% Second Mortgage Note
due 2001
1. Interest.
Elsinore Corporation, a Nevada corporation (the "Company"), promises
to pay interest on the principal amount of this Security at a rate of 13 1/2%
per annum. To the extent it is lawful, the Company promises to pay interest on
any interest payment due but unpaid on such principal amount at a rate of 13.5%
per annum compounded semi-annually.
The Company will pay interest semi-annually on February 28 and August
31 of each year (each, an "Interest Payment Date"), commencing February 28,
1997. Interest on the Securities will accrue from August 20, 1996. Interest will
be computed on the basis of a 360-day year consisting of twelve 30-day months.
2. Method of Payment.
The Company shall pay interest on the Securities (except defaulted
interest) to the persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date. Holders must
surrender Securities to a Paying Agent to collect principal payments. Except as
provided below, the Company shall pay principal and interest in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal and interest by wire transfer of Federal
funds, or interest by its check payable in such U.S. Legal Tender. The Company
may deliver any such interest payment to the Paying Agent or the Company may
mail any such interest payment to a Holder at the Holder's registered address.
3. Paying Agent and Registrar.
Initially, First Trust National Association (the "Trustee") will act
as Paying Agent and Registrar. The Company may change any Paying Agent,
Registrar or Co-registrar without notice to the Holders. The Company or any of
its Subsidiaries may, subject to certain exceptions, act as Paying Agent,
Registrar or Co-registrar.
4. Indenture.
The Company issued the Securities under an Amended and Restated
Indenture, dated as of March 3, 1997 (the "Indenture"), between the Company, the
Guarantors named therein and the Trustee. Capitalized terms herein are used as
defined in the Indenture unless otherwise defined herein. The terms of the
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act, as in effect on the date of
the Indenture. The Securities are subject to all such terms, and Holders of
Securities are referred to the Indenture and said Act for a statement of them.
The Securities are senior, secured obligations of the Company limited in
aggregate principal amount to $30,000,000.
5. Redemption.
The Securities are redeemable in whole or from time to time in part at
any time, at the option of the Company, upon full payment of principal of the
Securities, without premium, together with any accrued but unpaid interest to
the Redemption Date.
The Securities may also be redeemed at any time pursuant to, and in
accordance with, any order of any Gaming Authority with appropriate jurisdiction
and authority to the extent necessary in the reasonable, good faith judgment of
the Board of Directors of the Company to prevent the loss or material impairment
or secure the reinstatement of any Gaming License or to prevent such Gaming
Authority from taking any other action, which if lost, impaired, not reinstated
or taken, as the case may be, would have a material adverse effect on the
Company or any Subsidiary or where such redemption or acquisition is required
because the Holder or beneficial owner of the Securities is required to qualify,
be found suitable or become licensed as such under such Gaming Laws and does not
so qualify, obtain a finding of suitability or become licensed.
Any redemption of the Notes shall comply with Article Three of the
Indenture.
6. Notice of Redemption.
Notice of redemption will be mailed by first class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at his registered address. Securities in denominations
larger than $1,000 may be redeemed in part.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent on such Redemption Date, the
Securities called for redemption will cease to bear interest and the only right
of the Holders of such Securities will be to receive payment of the Redemption
Price, including any accrued and unpaid interest to the Redemption Date.
7. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder may register
the transfer of, or exchange Securities in accordance with, the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption.
8. Persons Deemed Owners.
The registered Holder of a Security may be treated as the owner of it
for all purposes.
9. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and the Paying Agent(s) will pay the money back to
the Company at its written request. After that, all liability of the Trustee and
such Paying Agent(s) with respect to such money shall cease.
10. Discharge Prior to Redemption or Maturity.
If the Company at any time deposits into an irrevocable trust with the
Trustee U.S. Legal Tender or U.S. Government Obligations sufficient to pay the
principal of and interest on the Securities to redemption or maturity and
complies with the other provisions of the Indenture relating thereto, the
Company will be discharged from certain provisions of the Indenture and the
Securities (including the financial covenants, but excluding its obligation to
pay the principal of and interest on the Securities).
11. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of a majority,
and in certain cases at least two-thirds, in aggregate principal amount of the
Securities then outstanding, and any existing Default or Event of Default or
compliance with any provision may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.
Without notice to or consent of any Holder, the parties thereto may amend or
supplement the Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of certificated Securities, comply with an order of any
Gaming Authority or make any other change that does not adversely affect the
rights of any Holder of a Security.
12. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the
Company and its Subsidiaries to, among other things, incur additional
Indebtedness, make payments in respect of its Capital Stock, enter into
transactions with Affiliates, incur Liens, sell assets, merge or consolidate
with any other person and sell, lease, transfer or otherwise dispose of
substantially all of its properties or assets. The limitations are subject to a
number of important qualifications and exceptions. The Company must annually
report to the Trustee on compliance with such limitations.
13. Change of Control.
In the event there shall occur any Change of Control, each Holder of
Securities shall have the right, at such Holder's option but subject to the
limitations, and conditions set forth in the Indenture, to require the Company
to purchase on the Change of Control Payment Date in the manner specified in the
Indenture, all or any part (in integral multiples of $1,000) of such Holder's
Securities at a Change of Control Purchase Price equal to 101% of the principal
amount thereof, together with accrued and unpaid interest, if any, to the Change
of Control Payment Date.
14. Security.
In order to secure the obligations under the Indenture, the Company,
the Guarantors and the Trustee have entered into certain security agreements in
order to create security interests in certain assets and properties of the
Company, the Guarantors and their respective Subsidiaries.
15. Gaming Law.
The rights of the Holder of this Security and any owner of any
beneficial interest in this Security are subject to the Gaming Laws and the
jurisdiction and requirements of the Gaming Authorities and the further
limitations and requirements set forth in the Indenture.
16. Successors.
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Securities. Subject to certain limitations,
Holders of a majority in aggregate principal amount of the Securities then
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Securities notice of any continuing Default
or Event of Default (except a Default in payment of principal or interest), if
it determines that withholding notice is in their interest.
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator, as such,
past, present or future, of the Company or any successor corporation shall have
any liability for any obligation of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Security by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
20. Authentication.
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on the other side of this
Security.
21. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a
Security 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).
22. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
[FORM OF ASSIGNMENT]
I or we assign this Security to
-----------------------------------------------------------------------------
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying number of assignee
__________________ and irrevocably appoint __________________________ agent to
transfer this Security on the books of the Company. The agent may substitute
another to act for him.
Dated: _____________ Signed: __________________________________
(Sign exactly as name appears on the other side of this Security)
EXHIBIT C
FORM OF GUARANTY
For value received, _________________________, a
__________________________ corporation, hereby unconditionally guarantees to the
Holder of the Security upon which this Guaranty is endorsed the due and punctual
payment, as set forth in the Indenture pursuant to which such Security and this
Guaranty were issued, of the principal of, premium (if any) and interest on such
Security when and as the same shall become due and payable for any reason
according to the terms of such Security and Article XIII of the Indenture. The
Guaranty of the Security upon which this Guaranty is endorsed will not become
effective until the Trustee signs the certificate of authentication on such
Security.
--------------------------------------
By: __________________________________
Attest: ________________________________
TABLE OF CONTENTS
ARTICLE I.................................................................2
DEFINITIONS AND INCORPORATION BY REFERENCE................................2
SECTION 1.1 Definitions................................................2
SECTION 1.2 Incorporation by Reference of TIA..........................17
SECTION 1.3 Rules of Construction......................................18
ARTICLE II................................................................18
THE SECURITIES............................................................18
SECTION 2.1 Exchange Of Original Notes For Restated Notes..............18
SECTION 2.2 Form and Dating............................................19
SECTION 2.3 Execution and Authentication...............................19
SECTION 2.4 Registrar and Paying Agent.................................20
SECTION 2.5 Paying Agent to Hold Assets in Trust.......................21
SECTION 2.6 Securityholder Lists.......................................21
SECTION 2.7 Transfer and Exchange......................................21
SECTION 2.8 Replacement Securities.....................................22
SECTION 2.9 Outstanding Securities.....................................22
SECTION 2.10 Treasury Securities.......................................23
SECTION 2.11 Temporary Securities......................................23
SECTION 2.12 Cancellation..............................................23
SECTION 2.13 Defaulted Interest........................................23
ARTICLE III...............................................................24
REDEMPTION................................................................24
SECTION 3.1 Right of Redemption........................................24
SECTION 3.2 Redemption Pursuant to Gaming Laws.........................24
SECTION 3.3 Notices to Trustee.........................................24
SECTION 3.4 Selection of Securities to Be Redeemed.....................25
SECTION 3.5 Notice of Redemption.......................................25
SECTION 3.6 Effect of Notice of Redemption.............................26
SECTION 3.7 Deposit of Redemption Price................................26
SECTION 3.8 Securities Redeemed in Part................................27
ARTICLE IV................................................................27
SECURITY..................................................................27
SECTION 4.1 Security Interest..........................................27
SECTION 4.2 Recording; Opinions of Counsel.............................28
SECTION 4.3 Disposition of Certain Collateral..........................28
SECTION 4.4 Certain Releases of Collateral.............................29
SECTION 4.5 Payment of Expenses........................................30
SECTION 4.6 Suits to Protect the Collateral............................30
SECTION 4.7 Trustee's Duties...........................................30
ARTICLE V.................................................................31
COVENANTS.................................................................31
SECTION 5.1 Payment of Securities......................................31
SECTION 5.2 Maintenance of Office or Agency............................31
SECTION 5.3 Limitation on Restricted Payments..........................32
SECTION 5.4 Corporate Existence........................................33
SECTION 5.5 Payment of Taxes and Other Claims..........................33
SECTION 5.6 Maintenance of Insurance...................................34
SECTION 5.7 Compliance Certificate; Notice of Default..................34
SECTION 5.8 Reports. 34
SECTION 5.9 Waiver of Stay, Extension or Usury Laws....................35
SECTION 5.10 Limitation on Transactions with Affiliates................35
SECTION 5.11 Limitation on Incurrence of Additional Indebtedness and
Disqualified Capital Stock................................35
SECTION 5.12 Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries..............................................37
SECTION 5.13 Limitation on Liens.......................................38
SECTION 5.14 Limitations on Sales of Assets and Subsidiary Stock.......38
SECTION 5.15 Maintenance of Consolidated Fixed Charges Coverage Ratio..38
SECTION 5.16 Maintenance of Consolidated Net Worth.....................39
SECTION 5.17 Limitation on Status as Investment Company................39
SECTION 5.18 Restrictions on Sale and Issuance of Subsidiary Stock.....39
SECTION 5.19 Additional Subsidiary Guarantors..........................39
ARTICLE VI................................................................39
SUCCESSOR CORPORATION.....................................................39
SECTION 6.1 Limitation on Merger, Sale or Consolidation................39
SECTION 6.2 Successor Corporation Substituted..........................41
ARTICLE VII...............................................................41
EVENTS OF DEFAULT AND REMEDIES............................................41
SECTION 7.1 Events of Default..........................................41
SECTION 7.2 Acceleration of Maturity Date; Rescission and Annulment....43
SECTION 7.3 Collection of Indebtedness and Enforcement by Trustee......45
SECTION 7.4 Trustee May File Proofs of Claim...........................45
SECTION 7.5 Trustee May Enforce Claims Without Possession of
Securities.................................................46
SECTION 7.6 Priorities.................................................46
SECTION 7.7 Limitation on Suits........................................47
SECTION 7.8 Unconditional Right of Holders to Receive Principal, Premium
and Interest...............................................48
SECTION 7.9 Rights and Remedies Cumulative.............................48
SECTION 7.10 Delay or Omission Not Waiver..............................48
SECTION 7.11 Control by Holders........................................48
SECTION 7.12 Waiver of Past Default....................................49
SECTION 7.13 Undertaking for Costs.....................................49
SECTION 7.14 Restoration of Rights and Remedies........................49
ARTICLE VIII..............................................................50
TRUSTEE...................................................................50
SECTION 8.1 Duties of Trustee..........................................50
SECTION 8.2 Rights of Trustee..........................................51
SECTION 8.3 Individual Rights of Trustee...............................52
SECTION 8.4 Trustee's Disclaimer.......................................52
SECTION 8.5 Notice of Default..........................................52
SECTION 8.6 Reports by Trustee to Holders..............................53
SECTION 8.7 Compensation and Indemnity.................................53
SECTION 8.8 Replacement of Trustee.....................................54
SECTION 8. 9 Successor Trustee by Merger, Etc..........................55
SECTION 8.10 Eligibility; Disqualification.............................55
SECTION 8.11 Preferential Collection of Claims against Company.........55
ARTICLE IX................................................................55
SATISFACTION AND DISCHARGE................................................55
SECTION 9.1 Satisfaction and Discharge of the Indenture................55
SECTION 9.2 Termination of Obligations Upon Cancellation of the
Securities.................................................57
SECTION 9.3 Survival of Certain Obligations............................57
SECTION 9.4 Acknowledgment of Discharge by Trustee.....................58
SECTION 9.5 Application of Trust Assets................................58
SECTION 9.6 Repayment to the Company...................................58
SECTION 9.7 Reinstatement..............................................59
ARTICLE X.................................................................59
AMENDMENTS, SUPPLEMENTS AND WAIVERS.......................................59
SECTION 10.1 Supplemental Indentures Without Consent of Holders........59
SECTION 10.2 Amendments, Supplemental Indentures and Waivers with
Consent of Holders........................................60
SECTION 10.3 Compliance with TIA.......................................61
SECTION 10.4 Revocation and Effect of Consents.........................61
SECTION 10.5 Notation on or Exchange of Securities.....................62
SECTION 10.6 Trustee to Sign Amendments, Etc...........................62
ARTICLE XI................................................................63
MEETINGS OF SECURITYHOLDERS...............................................63
SECTION 11.1 Purposes for Which Meetings May Be Called.................63
SECTION 11.2 Manner of Calling Meetings................................63
SECTION 11.3 Call of Meetings by Company or Holders....................64
SECTION 11.4 Who May Attend and Vote at Meetings.......................64
SECTION 11.5 Regulations May Be Made by Trustee, Conduct of the Meeting;
Voting Rights; Adjournment...............................64
SECTION 11.6 Voting at the Meeting and Record to Be Kept...............65
SECTION 11.7 Exercise of Rights of Trustee or Securityholders May
Not Be Hindered or Delayed by Call of Meeting............65
ARTICLE XII...............................................................66
RIGHT TO REQUIRE REPURCHASE...............................................66
SECTION 12.1 Repurchase of Securities at Option of the Holder Upon
Change of Control.........................................66
ARTICLE XIII..............................................................68
GUARANTY..................................................................68
SECTION 13.1 Guaranty..................................................68
SECTION 13.2 Execution and Delivery of Guaranty........................69
SECTION 13.3 Future Guarantors.........................................70
SECTION 13.4 Certain Bankruptcy Events.................................70
ARTICLE XIV...............................................................70
MISCELLANEOUS.............................................................70
SECTION 14.1 TIA Controls..............................................70
SECTION 14.2 Notices. 70
SECTION 14.3 Communications by Holders with Other Holders..............71
SECTION 14.4 Certificate and Opinion as to Conditions Precedent........72
SECTION 14.5 Statements Required in Certificate or Opinion.............72
SECTION 14.6 Rules by Trustee, Paying Agent, Registrar.................72
SECTION 14.7 Legal Holidays............................................73
SECTION 14.8 Governing Law.............................................73
SECTION 14.9 No Adverse Interpretation of Other Agreements.............73
SECTION 14.10 No Recourse Against Others...............................74
SECTION 14.11 Successors...............................................74
SECTION 14.12 Duplicate Originals......................................74
SECTION 14.13 Severability.............................................74
SECTION 14.14 Table of Contents, Headings, Etc.........................74
