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Exhibit 4.7
SUBORDINATED NOTES PROCEEDS AGREEMENT
SUBORDINATED NOTES PROCEEDS AGREEMENT (this "Agreement"),
dated as of December 30, 1997, among THE RESORT AT XXXXXXXXX, LIMITED
PARTNERSHIP (the "Partnership"), THE RESORT AT XXXXXXXXX, INC. ("Xxxxxxxxx,
Inc.", and together with the Partnership, the "Assignors"), UNITED STATES TRUST
COMPANY OF NEW YORK, as Trustee under the Indenture referred to below (in such
capacity, the "Trustee") and FIRST SECURITY TRUST COMPANY OF NEVADA as Account
Agent hereunder (in such capacity, the "Account Agent"). Except as otherwise
defined herein, terms used herein and defined in the Indenture, or in the
Disbursement Agreement referred to below, shall be used herein as so defined.
W I T N E S S E T H :
WHEREAS, the Assignors are to issue 13% Senior Subordinated
PIK Notes due 2007 (the "Subordinated Notes') in an initial aggregate principal
amount of $100,000,000 to be governed by an Indenture dated as of December 30,
1997 among the Assignors and the Trustee (as modified and in effect from time to
time, the "Indenture");
WHEREAS, the Assignors, certain lenders from time to time
party thereto, Gleacher Natwest, Inc., as Arranging Agent and the Administrative
Agent have entered into a Credit Agreement, dated as of December 30, 1997 (as
modified or restated and in effect from time to time, the "Credit Agreement");
WHEREAS, all proceeds of Subordinated Notes are required to be
directly deposited into the Subordinated Notes Proceeds Account; and
WHEREAS, the amounts in the Subordinated Notes Proceeds
Account may be disbursed into the Disbursement Account from time to time upon
the satisfaction of the applicable conditions set forth in the Disbursement
Agreement dated as of December 30, 1997 among inter alia the Trustee, the
Account Agent and First Security Trust Company of Nevada, as Disbursement Agent
(as modified or restated and in effect from time to time, the "Disbursement
Agreement");
NOW, THEREFORE, it is agreed:
SECTION 1. ESTABLISHMENT OF SUBORDINATED NOTE PROCEEDS
ACCOUNT; ETC.
1.01. Establishment. The Account Agent has established in its
own name and for the benefit of the holders of the Subordinated Notes (the
"Holders") an account (Account No. 702254B) (the "Subordinated Notes Proceeds
Account") for purposes of this Agreement, which
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Subordinated Notes Proceeds Account is maintained at the Account Agent's office
located at Las Vegas, Nevada (Wire instructions: First Security Bank of Nevada
-- ABA # 1224 01668). Subject to the provisions of this Agreement, the
Subordinated Notes Proceeds Account shall be under the sole dominion and control
of the Account Agent and, except as set forth in Section 3.01 hereof, the
Account Agent shall have the sole right to make withdrawals from the
Subordinated Notes Proceeds Account and to exercise all rights with respect to
the Collateral (as hereinafter defined) from time to time therein.
1.02. Deposits to the Subordinated Notes Proceeds Account. The
Assignors will transfer, in the funds received, all net proceeds of the
Subordinated Notes to the Account Agent for immediate deposit into the
Subordinated Notes Proceeds Account to be held therein until released pursuant
to the provisions of Section 3 below.
1.03. Investment of Funds. So long as any amounts remain in
the Subordinated Notes Proceeds Account, the Account Agent will from time to
time, at the request of the General Partner, invest funds on deposit in the
Subordinated Notes Proceeds Account in Cash Equivalents. All investments made
pursuant to this Section 1.03 (and any instruments evidencing same), and all
proceeds thereof, shall be held in the Subordinated Notes Proceeds Account as
part of the Collateral. All such investments shall be made in the name of the
Account Agent. All risk of loss in respect of investments made pursuant to this
Section 1.03 shall be on the Assignors.
SECTION 2. PLEDGE AND GRANT OF SECURITY INTEREST.
2.01. Pledge and Grant of Security Interest. As collateral
security to secure the full and prompt payment when due (whether at stated
maturity, by acceleration or otherwise) of the Obligations, each Assignor hereby
pledges and assigns to the Account Agent, for the benefit of the Holders, a
continuing possessory Lien and security interest in all of the right, title and
interest of such Assignor in and to the Subordinated Notes Proceeds Account, in
all funds deposited therein, in all investments from time to time therein, and
in all cash and non-cash proceeds of any of the foregoing (collectively, the
"Collateral"), from the date of the establishment of the Subordinated Notes
Proceeds Account until the termination thereof pursuant to the terms hereof. As
used herein, "Obligations" shall mean (i) the principal of, interest on or
premium on the Subordinated Notes, (ii) all other obligations and indebtedness
of each Assignor to the Holders now existing or hereafter incurred under,
arising out of, or in connection with the Indenture and Subordinated Notes, and
the due performance and compliance by each Assignor with all of the terms,
conditions and agreements contained in the Indenture and Subordinated Notes,
(iii) any and all sums advanced by the Account Agent in order to preserve the
Collateral or to preserve its security interest in the Collateral, (iv) in the
event of any proceeding for the collection or enforcement of any indebtedness,
obligations or liabilities of any Assignor referred to in clauses (i), (ii) or
(iii) above, after an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the reasonable expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing of or realizing on
the Collateral, or of any exercise by the Account Agent of its rights hereunder,
together with reasonable attorneys' fees and court costs and (v) all amounts
paid by any Indemnitee (as hereinafter defined) as to which such Indemnitee has
the right to reimbursement under Section 9 hereof.
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SECTION 3. WITHDRAWALS, APPLICATIONS AND REMEDIES.
3.01. Withdrawals. (a) Upon receipt by the Account Agent of a
Transfer Notice from the Disbursement Agent, the Account Agent shall, on the
Transfer Date or other date specified in the Transfer Notice, withdraw from the
Subordinated Notes Proceeds Account and transfer to the Disbursement Account its
Account Agent's Portion for such date (i.e., the portion, if any, of the
Requested Amount remaining unfunded after giving effect to all withdrawals from
the Partnership Funds Account resulting from such Transfer Notice made pursuant
to the order required by Section 2.02 of the Disbursement Agreement).
(b) To the extent required to make any withdrawal pursuant to
the foregoing clause of this Section 3.01, the Account Agent shall, and is
hereby authorized to, liquidate Cash Equivalents then on deposit in the
Subordinated Notes Proceeds Accounts pursuant to its customary practices for
liquidating such securities.
(c) Collateral may only be withdrawn as provided in clause (a)
of this Section 3.01, Section 3.02 and/or Section 10 and shall remain in the
Subordinated Notes Proceeds Account until so withdrawn. Neither the Account
Agent nor the Trustee shall have any liability whatsoever to any Holder or any
Person as a result of any release of Collateral by transfer to the Disbursement
Account following receipt by the Account Agent of a Transfer Notice regardless
of any subsequent determination that one or more of the conditions specified
herein or in the Disbursement Agreement to such withdrawal were not satisfied.
3.02. Remedies Upon a Noticed Event of Default; Application of
Proceeds. (a) If a Noticed Event of Default (as defined below) shall occur and
be continuing, if and to the extent directed to do so by the Trustee (acting at
the direction of the Holders of a majority in principal amount of the
Subordinated Notes), the Account Agent shall, subject to any mandatory
requirements of applicable law (including the Gaming Laws), (i) exercise in
respect of all of the Collateral in addition to other rights and remedies
provided for herein or otherwise available to it under applicable law, all of
the rights and remedies of a secured party on default under the Uniform
Commercial Code then in effect in the State of New York, (ii) liquidate all Cash
Equivalents in accordance with its customary practices for liquidating such
securities and/or (iii) withdraw the Collateral, if any, from the Subordinated
Notes Proceeds Account and pay the same to the Trustee for application to the
Obligations in accordance with Section 6.10 of the Indenture. As used herein, a
"Noticed Event of Default shall mean (x) an Event of Default under Section
6.01(ix) and (x) of the Indenture (Bankruptcy defaults) with respect to an
Assignor and (y) any other Event of Default that has been specified as a
"Noticed Event of Default" in writing from the Trustee to the Assignors.
(b) Each Assignor shall remain jointly and severally liable to
the extent of any deficiency between the amount of the proceeds of the
Collateral applied as provided in preceding clause (a) and the aggregate amount
of the Obligations.
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SECTION 4. FURTHER ASSURANCES.
Each Assignor agrees that it will, at any time and from time
to time, at its expense, promptly execute and deliver all further agreements,
instruments and other documents and take all further action that may be
necessary or that the Account Agent or the Trustee may reasonably request in
order to perfect and protect the security interest purported to be created
hereby or otherwise to enable the Account Agent to exercise and enforce its
rights and remedies hereunder.
SECTION 5. TRANSFERS AND OTHER LIENS.
Each Assignor agrees that it will not create or suffer to
exist any Lien upon or with respect to any Collateral except for the security
interest purported to be created hereby.
SECTION 6. ATTORNEY-IN-FACT.
Each Assignor hereby irrevocably appoints, which appointment
shall be coupled with an interest, the Account Agent its attorney-in-fact, with
full authority after the occurrence of and during the continuance of an Event of
Default, in the place and stead of such Assignor and in the name of such
Assignor or otherwise, from time to time in the Account Agent's discretion to
execute any instrument and to take any other action which the Account Agent may
deem necessary or advisable to accomplish the purposes of this Agreement or to
facilitate the assignment or other transfer by the Account Agent of any or all
of its rights hereunder.
SECTION 7. PERFORMANCE BY THE ACCOUNT AGENT.
If any Assignor fails to perform any agreement or obligation
contained herein, the Account Agent itself may perform or cause performance of
such agreement or obligation, and the expenses of the Account Agent incurred in
connection therewith shall be payable to the Account Agent by the Assignors.
SECTION 8. RESPONSIBILITY OF THE ACCOUNT AGENT AND TRUSTEE.
(a) Neither the Account Agent nor any of their respective
directors, officers, agents, employees, affiliates, representatives and agents
shall be liable for any failure to invest or reinvest any cash in the
Subordinated Notes Proceeds Account in accordance herewith or for any losses
incurred by reason of investments made by the Account Agent pursuant to Section
1.03 hereof. The Account Agent shall act hereunder on the same terms and
conditions as are set forth in Section 10 of the Credit Agreement (which section
is incorporated herein by reference with each reference therein to "Agent" to
include the Account Agent hereunder and each reference therein to "Lenders" to
include the Holders and by accepting the benefit hereof, the Holders being
deemed to have agreed to such provisions as so incorporated) and shall hold the
Collateral in accordance with this Agreement and with only such obligations in
respect thereof as are expressly set forth in this Agreement.
(b) The Account Agent acknowledges and agrees that (i) all
disbursements and releases made pursuant to this Agreement shall be made by the
Account Agent irrespective of,
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and without deduction for, any counterclaim, defense, recoupment or set-off and
shall be final, (ii) all service charges and fees with respect to this Agreement
or the Subordinated Notes Proceeds Account shall be paid by the Assignors, (iii)
it irrevocably waives and renounces any pledge, security interest (whether
consensual, statutory or otherwise) or right of offset or compensation that it
has or may ever have for its own benefit with respect to the Subordinated Notes
Proceeds Account, (iv) it shall maintain appropriate books and records with
respect to the Subordinated Notes Proceeds Account in which shall be recorded
all transactions related thereto including, without limitation, all
disbursements hereunder and any investments made by the Account Agent and shall
permit the Trustee or any of its agents or representatives to inspect and to
make copies of such books and records, as is reasonable, at the Assignors' sole
cost and expense and (v) it shall exercise its customary efforts and utilize
prudence in performing its duties hereunder in accordance with the terms of this
Agreement.
SECTION 9. INDEMNITY.
9.1. Indemnity. (a) Each Assignor jointly and severally agrees
to indemnify, reimburse and hold the Account Agent and, to the extent acting
hereunder, the Trustee and their respective successors, assigns, employees,
agents and servants (hereinafter in this Section 9.1 referred to individually as
"Indemnitee," and collectively as "Indemnitees") harmless from any and all
liabilities, obligations, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs, expenses or disbursements
(including reasonable attorneys' fees and expenses and herein collectively
called "expenses") of whatsoever kind and nature imposed on, asserted against or
incurred by any of the Indemnitees in any way relating to or arising out of this
Agreement or any other document executed in connection herewith or in any other
way connected with the administration of the transactions contemplated hereby or
the enforcement of any of the terms of, or the preservation of any rights under
any thereof, or in any way relating to or arising out of the use of the
Collateral; provided that no Indemnitee shall be indemnified pursuant to this
Section 9.1(a) for expenses to the extent caused by the gross negligence or
willful misconduct of such Indemnitee.
(b) Without limiting the application of Section 9.1(a) hereof,
each Assignor jointly and severally agrees to pay, or reimburse the Account
Agent, for any and all fees, costs and expenses of whatever kind or nature
incurred in connection with the creation, preservation or protection of the
Account Agent's Liens on, and security interest in, the Account, including,
without limitation, all fees and taxes in connection with the recording or
filing of instruments and documents in public offices, payment or discharge of
any taxes or Liens upon or in respect of the Collateral and all other fees,
costs and expenses in connection with protecting, maintaining or preserving the
Collateral and the Account Agent's interest therein, whether through judicial
proceedings or otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral.
(c) Without limiting the application of Section 9.1(a) or (b)
hereof, each Assignor jointly and severally agrees to pay, indemnify and hold
each Indemnitee harmless from and against any loss, costs, damages and expenses
which such Indemnitee may suffer, expend or incur in consequence of or growing
out of any misrepresentation by such Assignor in this Agreement or in
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any writing contemplated by or made or delivered pursuant to or in connection
with this Agreement.
(d) If and to the extent that the obligations of any Assignor
under this Section 9.1 are unenforceable for any reason, such Assignor hereby
agrees to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
9.2. Indemnity Obligations Secured by Collateral; Survival.
Any amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Section 9 shall
continue in full force and effect notwithstanding the full payment of all
Obligations.
SECTION 10. TERMINATION; RELEASE.
(a) Upon the Termination Date (as defined below) this
Agreement shall terminate, and the Account Agent will duly assign, transfer and
deliver to the Assignors (without recourse and without any representation or
warranty) the Collateral, if any, that remains in the possession of the Account
Agent and has not theretofore been sold or otherwise applied or released
pursuant to this Agreement together with any monies at the time held by the
Account Agent hereunder. As used in this Agreement, "Termination Date" shall
mean that date, occurring on and after the Commencement Date, which is one
Business Day after the date upon which all of the amounts on deposit in the
Subordinated Notes Proceeds Account have been applied as required by Section
3.01(a).
(b) At any time that the Assignors desire that Collateral be
released as provided in the foregoing Section 10(a), the Assignors shall deliver
to the Account Agent and the Administrative Agent a certificate signed by an
Authorized Officer of the General Partner, stating that the release of the
respective Collateral is permitted pursuant to said Section 10(a). Neither the
Account Agent nor the Administrative Agent shall have any liability whatsoever
to any Lender as a result of any release of Collateral by it as permitted by
this Section 10.
SECTION 11. NOTICES, ETC.
Except as otherwise specified herein, all notices, requests,
demands or other communications to or upon the respective parties hereto shall
be deemed to have been duly given or made when delivered as follows:
(a) if to any Assignor, at:
0000 Xxxx Xxxxxx Xxxxx
Xxxxx 000
Xxx Xxxxx, Xxxxxx
Attention: Xxxx Xxxxxx
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(b) if to the Account Agent:
c/o First Security Bank
Trust Dept.
000 Xxx Xxxxx Xxxx. Xxxxx
Xxx Xxxxx, XX 00000
(c) if to the Trustee:
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
SECTION 12. MISCELLANEOUS.
This Agreement and the rights and obligations of the parties
hereunder shall be construed in accordance with and be governed by the law of
the State of New York. This Agreement shall be binding upon each Assignor and
its successors and assigns and shall inure to the benefit of and be enforceable
by the Account Agent and the Trustee and their successors and assigns. The
headings in this Agreement are for purposes of reference only and shall not
limit or define the meaning hereof. This Agreement may be executed in any number
of counterparts, each of which shall be an original, but all of which shall
constitute one instrument. Delivery of an executed counterpart of the signature
pages to this Agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this Agreement. This Agreement shall become
effective on the date on which each of the parties shall have executed and
delivered a copy hereof. In the event that any provision of this Agreement shall
prove to be invalid or unenforceable, such provision shall be deemed to be
severable from the other provisions of this Agreement, which shall remain
binding on all parties hereto.
SECTION 13. WAIVER; AMENDMENT.
None of the terms and conditions of this Agreement may be
changed, waived, modified or varied in any manner whatsoever, except pursuant to
a writing signed by all the parties hereto. The Account Agent will be replaced
hereunder by a new Account Agent at such time as such new Account Agent replaces
the Disbursement Agent under and in accordance with Section 13 of the
Disbursement Agreement. Upon the effectiveness of such replacement, the original
Account Agent will transfer to the new Subordinated Notes Proceeds Account
established by the new Account Agent all amounts on deposit in the original
Subordinated Notes Proceeds Account.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized representatives,
as of the date first above written.
THE RESORT AT XXXXXXXXX, LIMITED
PARTNERSHIP, as an Assignor
By:___________________________
its General Partner
By:___________________________
Title:
THE RESORT AT XXXXXXXXX, INC.,
as an Assignor
By:___________________________
Title
FIRST SECURITY TRUST COMPANY OF NEVADA,
as Account Agent
By:___________________________
Title:
UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee
By:___________________________
Title:
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