Exhibit 10.27
Transaction No. 1203-P-01-01
PROMISSORY NOTE
US$29,313,888.96 June 30, 2005
FOR VALUE RECEIVED, Cruise Holdings I, LLC, a Nevada limited liability
company ("Cruise I"), Cruise Holdings II, LLC, a Nevada limited liability
company ("Cruise II"), Royal Star Entertainment, LLC, a Delaware limited
liability company ("RSE"), Riviera Beach Entertainment, LLC, a Delaware limited
liability company ("RBE"), ITG Vegas, Inc., a Nevada corporation ("ITGV") and
ITG Palm Beach, LLC, a Delaware limited liability company ("ITGPB"), each
jointly and severally, each with an office and place of business at ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ (Cruise I, Cruise II, RSE,
RBE, ITGV and ITGPB are hereinafter individually and collectively referred to
as, the "Borrower"), promises to pay to the order of PDS Gaming Corporation, a
Minnesota corporation ("Lender"), on or before July 1, 2009 (the "Maturity
Date"), the principal sum of Twenty-Nine Million Three Hundred Thirteen Thousand
Eight Hundred Eighty Eight Dollars and Ninety Six Cents (US$29,313,888.96) with
interest on the principal balance outstanding from time to time at the annual
rate of interest (the "Interest Rate") as set forth in the Loan and Security
Agreement of even date herewith between Lender and Borrower (the "Loan
Agrement"), compounded annually. Any undefined terms in this Note shall be as
defined in the Loan Agreement.
1. Payments. Principal and interest under this Note shall be paid as
follows:
(a) Principal and interest under this Note shall be due and
payable as provided in the Loan Agreement until all principal and
accrued interest owing on this Note shall have been fully paid and
satisfied.
(b) The entire principal balance (together with all accrued and
unpaid interest) shall be due and payable in full on the Maturity Date.
(c) Principal and interest accrued hereunder shall be payable in
lawful money of the United States of America to Lender by wire transfer
of funds to an account as designated by ▇▇▇▇▇▇ from time to time, at
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇- ▇▇▇▇ or at such other
address as ▇▇▇▇▇▇ may designate in writing from time to time to
Borrower.
2. Prepayments. Borrower may prepay the remaining balance of principal
and accrued interest evidenced by this Note in accordance with and upon the
terms set forth in the Loan Agreement.
3. Closing Fee. On the effective date of this Note, Borrower shall pay
to Lender a closing fee in the amount and upon the terms set forth in the Loan
Agreement.
4. Late Fee. Borrower shall pay to Lender a late fee in the amount of
ten percent (10%) of any installment payment not received by Lender within five
(5) days of the date any such payment is due under the terms of this Note.
5. Events of Default. The occurrence of any of the following shall
constitute an Event of Default under this Note:
(a) Failure by Borrower to make any payment of principal or
interest under this Note within ten (10) days of when due and payable;
or
(b) Any default or event of default under the Loan Agreement,
which default or event of default remains uncured beyond any applicable
cure period.
6. Acceleration. Upon the occurrence of an Event of Default, Lender,
at its option and without notice to ▇▇▇▇▇▇▇▇, may declare the full amount of the
principal indebtedness of this Note, together with all interest accrued
hereunder to the date of said declaration, to be immediately due and payable,
and immediate payment may be demanded by ▇▇▇▇▇▇ from Borrower. Thereafter, to
the extent permitted by applicable law, interest shall accrue on said principal
and interest at a rate per annum equal to the Interest Rate, plus five percent
(5%), until said principal and interest are paid in full to Lender.
7. Waiver. Borrower agrees (a) that the failure of Lender to exercise
any rights or remedies granted hereunder shall not constitute a waiver of such
rights or remedies or any other rights or remedies, or preclude the exercise of
such rights or remedies or any other rights or remedies at any time, and (b)
that failure of Lender to exercise any rights or remedies granted hereunder, in
the event of a breach hereof or an Event of Default hereunder, shall not be
deemed a waiver of such breach or Event of Default or of any other or further
breaches or Events of Default. In addition, Borrower hereby waives demand,
presentment for payment, notice of dishonor, protest and notice of protest, and
diligence in collection and bringing suit and agrees that Lender may extend the
time for payment, accept partial payment, or take, exchange, or release security
without discharging or releasing Borrower.
8. Governing Law. This Note shall be construed and enforced in
accordance with the laws of the State of Nevada, without giving effect to
principles of conflicts of law.
9. Rights and Remedies. This Note is secured by the Loan Documents.
The rights and remedies set forth herein shall be cumulative and in addition to
any other or further rights and remedies available at law or in equity. The
invalidity or unenforceability of any term or provision of this Note, or the
application of such term or provision to any person or circumstance, shall not
impair or affect the remainder of this Note and its application to other persons
and circumstances and the remaining terms and provisions hereof shall not be
invalid, but shall remain in full force and effect.
10. Notices. Any notice to Borrower required or permitted hereunder
shall be deemed to have been effectively delivered if in writing and served by
personal delivery to Borrower or sent by registered or certified mail with
return receipt requested (or such form of mail as may be substituted therefor by
postal authorities), postage prepaid.
11. Attorney's Fees. If any holder of this Note retains an attorney in
connection with any Event of Default or at maturity or to collect, enforce or
defend this Note or the Loan Agreement in any lawsuit or in any probate,
reorganization, bankruptcy, arbitration or other proceeding, or if Borrower sues
any holder in connection with this Note or the Loan Agreement and does not
prevail, then Borrower agrees to pay to each such holder, in addition to
principal, interest and any other sums owing to Lender hereunder and under the
Loan Agreement, all reasonable costs and expenses incurred by such holder in
trying to collect this Note or in any such suit or proceeding, including,
without limitation, reasonable attorneys' fees and expenses, investigation costs
and all court costs, whether or not suit is filed hereon, whether before or
after the Maturity Date, or whether in connection with bankruptcy, insolvency or
appeal, or whether collection is made against Borrower or any guarantor or
endorser or any other person primarily or secondarily liable hereunder.
12. Commercial Purpose. Borrower warrants that the proceeds of this
Note shall be used solely for the commercial purpose of operating and expanding
the business operations of the ITG Entities related to the Princess Vessel, the
Big Easy Vessel, the Royal Star Vessel and any other maritime vessel operated by
the Palm Beach Entities at the Port of Palm Beach, Florida or for a Gaming
Investment, as defined in the Loan Agreement; provided, however, the proceeds of
this Note shall in no event be used for purposes of making any shareholder or
equity distributions to any member, partner or shareholder of any Palm Beach
Entity or for any other purpose not permitted under the Loan Agreement.
13. Service of Process. Borrower hereby irrevocably designates and
appoints ______________________________________________________, as ▇▇▇▇▇▇▇▇'s
authorized agent to accept and acknowledge on Borrower's behalf service of any
and all process that may be served in any suit, action, or proceeding instituted
in connection with this Note in any state or federal court sitting in tStat of
Nevada. If such agent shall cease so to act, Borrower shall irrevocably
designate and appoint without delay another such agent in the State of Nevada
satisfactory to Lender and shall promptly deliver to Lender evidence in writing
of such agent's acceptance of such appointment and its agreement that such
appointment shall be irrevocable.
Borrower hereby consents to process being served in any suit, action,
or proceeding instituted in connection with this Note by (a) the mailing of a
copy thereof by certified mail, postage prepaid, return receipt requested, to
Borrower and (b) serving a copy thereof upon the agent, if any, hereinabove
designated and appointed by ▇▇▇▇▇▇▇▇ as ▇▇▇▇▇▇▇▇'s agent for service of process.
Borrower irrevocably agrees that such service shall be deemed to be service of
process upon Borrower in any such suit, action, or proceeding. Nothing in this
Note shall affect the right of Lender to serve process in any manner otherwise
permitted by law and nothing in this Note will limit the right of Lender
otherwise to bring proceedings against Borrower in the courts of any
jurisdiction or jurisdictions.
14. WAIVER OF JURY TRIAL. ▇▇▇▇▇▇▇▇ WAIVES TRIAL BY JURY IN ANY ACTION
OR PROCEEDING TO WHICH ▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇ MAY BE PARTIES, ARISING OUT OF, IN
CONNECTION WITH OR IN ANY WAY PERTAINING TO, THIS NOTE, THE LOAN AGREEMENT OR
OTHER LOAN DOCUMENTS. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A
WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTION OR
PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS NOTE.
THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY ▇▇▇▇▇▇▇▇, AND
BORROWER HEREBY REPRESENTS THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN
MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY
MODIFY OR NULLIFY ITS EFFECT. ▇▇▇▇▇▇▇▇ FURTHER REPRESENTS AND WARRANTS THAT IT
HAS BEEN REPRESENTED IN THE SIGNING OF THIS NOTE AND IN THE MAKING OF THIS
WAIVER BY INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE OPPORTUNITY TO BE
REPRESENTED BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT
IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
IN WITNESS WHEREOF, this Note has been executed by each of the
Borrower as of the day and year first above written.
CRUISE HOLDINGS I, LLC, CRUISE HOLDINGS II, LLC,
a Nevada limited liability company a Nevada limited liability company
By: By:
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Name: Name:
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Title: Title:
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ITG VEGAS, INC., ITG PALM BEACH, LLC,
a Nevada corporation a Delaware limited liability company
By: By:
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Name: Name:
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Title: Title:
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ROYAL STAR ENTERTAINMENT, LLC RIVIERA BEACH ENTERTAINMENT, LLC,
a Delaware limited liability company a Delaware limited liability company
By: By:
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Name: Name:
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Title: Title:
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