AMENDMENT TO FIRST AMENDED
AND RESTATED PROMISSORY NOTE
THIS AGREEMENT is made as of the 5th day of November, 1999, by and between
SILVER CLUB, a Nevada corporation (the "Borrower"), and INTERNATIONAL GAME
TECHNOLOGY, a Nevada corporation (the "Lender").
W I T N E S S E T H:
WHEREAS, Borrower executed and delivered its First Amended And Restated
Promissory Note to Xxxxx Fargo Bank, National Association (as the successor by
merger to First Interstate Bank of Nevada, N.A.) ("Xxxxx Fargo Bank"), dated as
of April 16, 1999, in the original principal amount of $8,678,413.99, as amended
by that certain First Amendment to First Amended And Restated Promissory Note
dated October 26, 1999 (the "Note"), which Note is secured by a Deed of Trust
and Security Agreement With Assignment of Rents dated December 27, 1988, and
recorded December 30, 1988, in Book 2848, Page 247, as Document No. 1296502,
Official Records of Washoe County, Nevada, encumbering certain real property
described therein, which Deed of Trust was amended by First Amendment to Deed of
Trust And Security Agreement with Assignment of Rents dated April 16, 1999,
recorded on April 21, 1999, in the Office of the County Recorder, Washoe County,
Nevada, as Document No. 2330943 (the "Deed of Trust");
WHEREAS, Lender has acquired all of Xxxxx Fargo Bank's right, title and
interest in and to the Note and the loan evidenced thereby;
WHEREAS, there is presently due on account of the Note the principal sum
of $8,526,030.98 with interest paid to September 16, 1999; and
WHEREAS, Borrower and Lender desire to amend the terms of the Note as
hereinafter set forth.
NOW, THEREFORE, for valuable consideration, Borrower and Lender agree as
follows:
1. Any capitalized words or terms used but not otherwise defined herein
shall have the meanings given to such words or terms in the Note. All references
to "Lender" in the Note (except as provided in paragraph 6b below) shall be
deemed to refer to International Game Technology, a Nevada corporation.
2. Commencing on the date hereof (the "Interest Rate Adjustment Date"),
the rate of interest charged under the Note shall be adjusted to a floating rate
equal to the Prime Rate, as the same shall fluctuate from time to time, plus one
percent (1.00%) per annum. On the date which is twenty-four (24) months
following the Interest Rate Adjustment Date, the rate of interest charged under
the Note shall be adjusted to a floating rate equal to the Prime Rate, as the
same shall fluctuate from time to time, plus two percent (2.00%) per annum. All
references in the Note to the Note Rate shall mean the interest rate then in
effect computed in accordance with the preceding two (2) sentences.
3. The monthly payments of principal and interest under the Note are
hereby amended to the amount of Eighty-One Thousand Six Hundred Eighty-Three
Dollars ($81,683.00) commencing with the payment due on December 1, 1999, and
continuing on the same day of each month thereafter until the Maturity Date.
Such payments shall be applied first to accrued interest and then to principal.
4. In addition to the monthly payments set forth in Paragraph 3 above, on
the date which is two years after the date of this Agreement (the "Additional
Payment Date") Borrower shall pay to Lender an amount equal to excess, if any of
(i) Two Million Dollars ($2,000,000) over (ii) the amount, as of the Additional
Payment Date, of outstanding principal and interest under the sum of (x) that
promissory note dated September 30, 1993 in the original principal sum of
$2,560,981.05 executed by CMS International, a Nevada corporation ("CMS"), in
favor of Lender and (y) the amount, as of the Additional Payment Date, of the
outstanding principal and interest under that promissory note dated July 1, 1994
in the original principal sum of $775,688.00 executed by CMS in favor of Lender
(the "Additional Payment"). Notwithstanding the foregoing, in the event an
initial public offering (the "IPO") with respect to the stock of Borrower or a
new entity that will own 100% of Borrower is consummated within two years after
the date of this Agreement, the Additional Payment Date shall be extended until
the date which is thirty (30) months after the date of this Agreement. For
purposes hereof, the IPO shall be deemed to have been consummated when Borrower
has received an initial firm commitment for an underwritten public offering
registration under the Securities Act of 1933, as amended, generating proceeds
to Borrower in an amount not less than $4,000,000.00 and has received all
necessary approvals from the Nevada Gaming Commission for such IPO. The
Additional Payment shall be applied by Lender as follows: (a) first to that
certain CMS Substituted Note dated September 30, 1993, in the original principal
amount of $2,560,981.05 made by CMS in favor of Lender, (b) then to that certain
CMS Secured Promissory Note (Tax Note) dated July 1, 1994, in the original
principal amount of $775,688.00 made by CMS in favor of Lender, and (c) then to
the Note.
5. The Maturity Date of the Note is hereby extended to December 31, 2008,
upon which date any balance of principal and accrued and unpaid interest shall
be paid in full.
6. Definitions. For the purposes hereof, the following words and terms
shall have the following meanings:
a. The definition of Executive Group in Paragraph 1 of the Note is
amended and restated in its entirety to mean a collective reference to Xxxxxx
Xxxxxx, Xx., E. Xxxxxxx Xxxxxx and Xxxxx Xxxxxxx, or their successors.
b. The definition of Prime Rate in Paragraph 1 of the Note is
amended to provide that each reference therein to "Lender" shall be deemed to
refer to Xxxxx Fargo Bank, National Association.
c. All references in the Note to Deed of Trust shall mean the Deed
of Trust as amended by that Modification to Deed of Trust and Security Agreement
with Assignment of Rents dated as of the date of this Agreement.
7. Paragraph 3 of the Note entitled Guaranty is deleted in its entirety.
8. Paragraph 5 (b)(iii) of the Note is hereby amended to provide as
follows:
"(iii) as of the end of each Fiscal Year, commencing with the Fiscal
Year ending September 30, 2000, the Tangible Net Worth of the
Consolidation Group shall be at least Three Million Seven Hundred
Fifty Thousand Dollars ($3,750,000.00);"
9. Paragraph 5(b)(v)(i) of the Note is hereby amended to provide as
follows:
"(i) incur any Indebtedness other than liabilities incurred in the
ordinary course of business, purchase money obligations incurred for
the purpose of acquiring equipment in the ordinary course of
business (the "Acquired Equipment"), and obligations incurred in
connection with the construction of an RV Park in Hawthorne, Nevada,
and/or the expansion of the Silver Club Hotel & Casino; provided,
however, the lien of the Deed of Trust retains the same priority as
on the date hereof;"
10. Paragraph 5 (b)(vii) of the Note is hereby amended to provide as
follows:
"(vii) during any time that an Event of Default has occurred and is
continuing, the aggregate compensation paid to the Executive Group
by the members of the Consolidation Group shall be limited to
$35,416.67 per month ($425,000.00 annualized) excluding health
insurance, life insurance and other benefits then existing;"
11. Paragraph 5 (b) (viii) of the Note is hereby amended to provide as
follows:
"(viii) no compensation (whether pursuant to wages, bonuses, draws,
salary, or other forms of compensation or advances on any of the
foregoing) shall be paid to The Holder Group, LLC, a Nevada limited
liability company, or to Xxxxxx X. Xxxxxx, Xx., by any member of the
Consolidation Group at any time when the Tangible Net Worth for the
Consolidation Group is less than Three Million Seven Hundred Fifty
Thousand Dollars ($3,750,000.00);"
12. Paragraph 5(b) of the Note is hereby amended by adding thereto the
following additional financial covenant:
"(ix) no members of the Consolidation Group shall make any loan to
officers, directors, stockholders or affiliates of Borrower,
including affiliates of The Holder Group, LLC, a Nevada limited
liability company, without the prior written consent of Lender. The
foregoing shall not restrict inter-company loans by and between
Summit Casinos-Nevada, Inc., a Nevada corporation ("Summit"), and
its subsidiaries."
13. Paragraph 6(a) of the Note is hereby amended to provide as follows:
"(a) Any representation or warranty made by Borrower in this Note
shall prove to be false or incorrect in any material respect as of
the date hereof, or shall hereafter become false or incorrect in any
material respect, or if Borrower shall breach any financial covenant
set forth in Paragraph 5(b) hereof (each a "breach"), and Borrower
shall fail to provide to Lender a written plan for correcting such
breach within thirty (30) days following notice from Lender of such
breach, which plan shall provide that such breach shall be cured
within ninety (90) days thereafter or Borrower fails to complete
cure of such breach within ninety (90) days following Lender's
notice. Such plan could provide for an equity infusion and/or debt
reduction to cure a breach of the financial covenant set forth in
Paragraph 5(b)(i) and/or 5(b)(iii), or could provide for a debt
reduction in an amount sufficient to reduce projected interest
expense over the succeeding twelve (12) month period to cure a
breach of the financial covenant set forth in Paragraph 5(b)(ii)."
14. Paragraph 7 of the Note is amended and restated in its entirety as
follows:
"7. Upon the occurrence of an Event of Default, the total of the
unpaid balance of principal and the then accrued unpaid interest
shall collectively commence accruing interest at the rate equal to
the Prime Rate plus three percent (3%), adjusted daily, until such
Event of Default is cured, at which time the interest rate under
this Note shall revert to the then applicable Note Rate."
15. Paragraph 10 of the Note is hereby deleted in its entirety.
16. The notice addresses set forth in paragraph 13(d) of the Note are
hereby amended to the following:
If to Borrower: Silver Club
P.O. Box 10750
Xxxx, Xxxxxx 00000
Attn: Xxxxx Xxxxxxx
Facsimile No. (000) 000-0000
If to Lender: International Game Technology
X.X. Xxx 00000
Xxxx, Xxxxxx 00000-0000
Attn: Xxxxxxx Xxxxxxxxx
Chief Financial Officer/
Vice President Finance
17. The Note is hereby amended by adding the following additional
provision thereto:
"13(m) Lender shall permit Summit to be "collapsed" (by means of a
merger, dissolution or similar reorganization) into CMS, with Summit
to be dissolved, and with any and all obligations, restrictions and
covenants relating to Summit set forth herein shall thereafter
relate to CMS."
18. Upon the execution of this Agreement, that certain Agreement dated
April 16, 1999, between Lender and Borrower relating to the Note (a copy of
which is attached hereto as Exhibit "A-1"), shall be deemed terminated and of no
further force or effect.
19. To induce IGT to enter into this Agreement, Borrower makes the
following representations and warranties which shall be deemed to be continuing
representations and warranties until payment in full of all amounts due and
owing to IGT under the obligations described herein:
a. Borrower is a corporation duly organized and validly existing
under the laws of the State of Nevada and has all requisite power, authority and
legal right to execute and deliver this Agreement and any other document,
agreement or certificate to which it is a party, or to which it is bound in
connection herewith. Borrower has taken all necessary action to authorize the
execution, delivery and performance of this Agreement and of any other document
to which Borrower is a party or by which Borrower is bound in connection
herewith.
b. Neither this Agreement, nor any document to which Borrower is a
party (or by which Borrower is bound) in connection herewith is prevented by,
limited by, conflicts in any material respect with, or will result in a material
breach of, violation of, or a material default (with due notice or lapse of
time, or both) under, or the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of Borrower's property or assets
by virtue of the terms, conditions or provisions of: (i) any indenture, evidence
of indebtedness, loan or financing agreement, or other agreement or instrument
of whatever nature to which Borrower is a party or by which Borrower is bound,
or (ii) any provision of any existing law, rule, regulation, order, writ,
injunction or decree of any court or governmental authority to which Borrower is
subject.
c. This Agreement will constitute legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with its
terms.
d. All timely consents, approvals, orders or authorizations of, or
registrations, declarations, notices or filings with any governmental authority
(or judicial proceeding), which may be required in connection with the valid
execution and delivery of this Agreement and the performance of any of the
obligations hereunder have been obtained or accomplished, or will be obtained or
accomplished as and when due, or are in full force and effect.
20. Except as herein amended, the Note remains in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
SILVER CLUB, a Nevada corporation,
By: /s/ Xxxxxx Xxxxxx, Xx.
Its: Chief Executive Officer
"Borrower"
INTERNATIONAL GAME TECHNOLOGY,
a Nevada corporation,
By: /s/ G. Xxxxxx Xxxxx
Its: President
and Chief Operating Officer
"Lender"
AMENDMENT TO FIRST AMENDED
AND RESTATED SECURED PROMISSORY NOTE
(Refinance)
THIS AGREEMENT is made as of the 5th day of November, 1999, by and between
CMS-EL CAPITAN, a Nevada corporation (the "Borrower"), and INTERNATIONAL GAME
TECHNOLOGY, a Nevada corporation (the "Lender").
W I T N E S S E T H:
WHEREAS, Borrower executed and delivered its First Amended And Restated
Secured Promissory Note (Refinance) to Xxxxx Fargo Bank, National Association
(as the successor by merger to First Interstate Bank of Nevada, N.A.) ("Xxxxx
Fargo Bank"), dated as of April 16, 1999, in the original principal amount of
$2,909,051.82, as amended by that certain First Amendment to First Amended And
Restated Secured Promissory Note (Refinance) dated October 26, 1999 (the
"Note"), which Note is secured by a Deed of Trust and Security Agreement With
Assignment of Rents dated May 3, 1996, and recorded May 7, 1996, in Book 165,
Page 86, as Document No. 113112, Official Records of Mineral County, Nevada,
encumbering certain real property described therein, which Deed of Trust was
amended by First Amendment to Deed of Trust And Security Agreement with
Assignment of Rents dated April 16, 1999, recorded on April 21, 1999, in the
Office of the County Recorder, Mineral County, Nevada, as Document No. 121273
(the "Deed of Trust");
WHEREAS, Lender has acquired all of Xxxxx Fargo Bank's right, title and
interest in and to the Note and the loan evidenced thereby;
WHEREAS, there is presently due on account of the Note the principal sum
of $2,857,506.32 with interest paid to September 16, 1999; and
WHEREAS, Borrower and Lender desire to amend the terms of the Note as
hereinafter set forth.
NOW, THEREFORE, for valuable consideration, Borrower and Lender agree as
follows:
1. Any capitalized words or terms used but not otherwise defined herein
shall have the meanings given to such words or terms in the Note. All references
to "Lender" in the Note (except as provided in paragraph 5b below) shall be
deemed to refer to International Game Technology, a Nevada corporation.
2. Commencing on the date hereof (the "Interest Rate Adjustment Date"),
the rate of interest charged under the Note shall be adjusted to a floating rate
equal to the Prime Rate, as the same shall fluctuate from time to time, plus one
percent (1.00%) per annum. On the date which is twenty-four (24) months
following the Interest Rate Adjustment Date, the rate of interest charged under
the Note shall be adjusted to a floating rate equal to the Prime Rate, as the
same shall fluctuate from time to time, plus two percent (2.00%) per annum. All
references in the Note to the Note Rate shall mean the interest rate then in
effect computed in accordance with the preceding two (2) sentences.
3. The monthly payments of principal and interest under the Note are
hereby amended to the amount of Thirty-Six Thousand Dollars ($36,000.00)
commencing with the payment due on December 1, 1999, and continuing on the same
day of each month thereafter until the Maturity Date. Such payments shall be
applied first to accrued interest and then to principal.
4. The Maturity Date of the Note is hereby extended to December 31, 2008,
upon which date any balance of principal and accrued and unpaid interest shall
be paid in full.
5. Definitions. For the purposes hereof, the
following words and terms shall have the following
meanings:
a. The definition of Executive Group in Paragraph 1 of the Note is
amended and restated in its entirety to mean a collective reference to Xxxxxx
Xxxxxx, Xx., E. Xxxxxxx Xxxxxx and Xxxxx Xxxxxxx, or their successors.
b. The definition of Prime Rate in Paragraph 1 of the Note is
amended to provide that each reference therein to "Lender" shall be deemed to
refer to Xxxxx Fargo Bank, National Association.
c. All references in the Note to Deed of Trust shall mean the Deed
of Trust as amended by that Modification to Deed of Trust and Security Agreement
with Assignment of Rents dated as of the date of this Agreement.
6. Paragraph 3 of the Note entitled Guaranty is deleted in its entirety.
7. Paragraph 5 (b)(iii) of the Note is hereby amended to provide as
follows:
"(iii) as of the end of each Fiscal Year, commencing with the Fiscal
Year ending September 30, 2000, the Tangible Net Worth of the
Consolidation Group shall be at least Three Million Seven Hundred
Fifty Thousand Dollars ($3,750,000.00);"
8. Paragraph 5(b)(v)(i) of the Note is hereby amended to provide as
follows:
"(i) incur any Indebtedness other than liabilities incurred in the
ordinary course of business, purchase money obligations incurred for
the purpose of acquiring equipment in the ordinary course of
business (the "Acquired Equipment"), and obligations incurred in
connection with the construction of an RV Park in Hawthorne, Nevada,
and/or the expansion of the Silver Club Hotel & Casino; provided,
however, the lien of the Deed of Trust retains the same priority as
on the date hereof."
9. Paragraph 5 (b)(vii) of the Note is hereby amended to provide as
follows:
"(vii) during any time that an Event of Default has occurred and is
continuing, the aggregate compensation paid to the Executive Group
by the members of the Consolidation Group shall be limited to
$35,416.67 per month ($425,000.00 annualized) excluding health
insurance, life insurance and other benefits then existing;"
10. Paragraph 5 (b) (viii) of the Note is hereby amended to provide as
follows:
"(viii) no compensation (whether pursuant to wages, bonuses, draws,
salary, or other forms of compensation or advances on any of the
foregoing) shall be paid to The Holder Group, LLC, a Nevada limited
liability company, or to Xxxxxx X. Xxxxxx, Xx., by any member of the
Consolidation Group at any time when the Tangible Net Worth for the
Consolidation Group is less than Three Million Seven Hundred Fifty
Thousand Dollars ($3,750,000.00);"
11. Paragraph 5(b) of the Note is hereby amended by adding thereto the
following additional financial covenant:
"(ix) no members of the Consolidation Group shall make any loan to
officers, directors, stockholders or affiliates of Borrower,
including affiliates of The Holder Group, LLC, a Nevada limited
liability company, without the prior written consent of Lender. The
foregoing shall not restrict inter-company loans by and between
Summit Casinos-Nevada, Inc., a Nevada corporation ("Summit"), and
its subsidiaries."
12. Paragraph 6(a) of the Note is hereby amended to provide as follows:
"(a) Any representation or warranty made by Borrower in this Note
shall prove to be false or incorrect in any material respect as of
the date hereof, or shall hereafter become false or incorrect in any
material respect, or if Borrower shall breach any financial covenant
set forth in Paragraph 5(b) hereof (each a "breach"), and Borrower
shall fail to provide to Lender a written plan for correcting such
breach within thirty (30) days following notice from Lender of such
breach, which plan shall provide that such breach shall be cured
within ninety (90) days thereafter or Borrower fails to complete
cure of such breach within ninety (90) days following Lender's
notice. Such plan could provide for an equity infusion and/or debt
reduction to cure a breach of the financial covenant set forth in
Paragraph 5(b)(i) and/or 5(b)(iii), or could provide for a debt
reduction in an amount sufficient to reduce projected interest
expense over the succeeding twelve (12) month period to cure a
breach of the financial covenant set forth in Paragraph 5(b)(ii)."
13. Paragraph 6 of the Note is hereby amended to include the following
additional "Events of Default":
"(i) Any default by Silver Club, a Nevada corporation ("Silver
Club"), to make the Additional Payment (as defined in that certain
First Amended And Restated Promissory Note dated April 16, 1999, as
amended from time to time, made by Silver Club in favor of Xxxxx
Fargo Bank) when due.
(j) Any default by CMS International, a Nevada corporation ("CMS"),
to make the payment due at maturity under that certain CMS
Substituted Note dated September 30, 1993, in the original principal
amount of $2,560,981.05 made by CMS in favor of Lender.
(k) Any default by CMS to make the payment due at maturity under
that certain CMS Secured Promissory Note (Tax Note) dated July 1,
1994, in the original principal amount of $775,688.00 made by CMS in
favor of Lender."
14. Paragraph 7 of the Note is amended and restated in its entirety as
follows:
"7. Upon the occurrence of an Event of Default, the total of the
unpaid balance of principal and the then accrued unpaid interest
shall collectively commence accruing interest at the rate equal to
the Prime Rate plus three percent (3%), adjusted daily, until such
Event of Default is cured, at which time the interest rate under
this Note shall revert to the then applicable Note Rate."
15. Paragraph 10 of the Note is hereby deleted in its entirety.
16. The notice addresses set forth in paragraph 13(d) of the Note are
hereby amended to the following:
If to Borrower: Silver Club
P.O. Box 10750
Xxxx, Xxxxxx 00000
Attn: Xxxxx Xxxxxxx
Facsimile No.(000)000-0000
If to Lender: International Game Technology
X.X. Xxx 00000
Xxxx, Xxxxxx 00000-0000
Attn: Xxxxxxx Xxxxxxxxx
Chief Financial Officer/
Vice President Finance
17. The Note is hereby amended by adding the following additional
provision thereto:
"13(m) Lender shall permit Summit to be "collapsed" (by means of a
merger, dissolution or similar reorganization) into CMS, with Summit
to be dissolved, and with any and all obligations, restrictions and
covenants relating to Summit set forth herein shall thereafter
relate to CMS."
18. Upon the execution of this Agreement, that certain Agreement dated
April 16, 1999, between Lender and Borrower relating to the Note (a copy of
which is attached hereto as Exhibit "A-1") shall be deemed terminated and of no
further force or effect.
19. To induce IGT to enter into this Agreement, Borrower makes the
following representations and warranties which shall be deemed to be continuing
representations and warranties until payment in full of all amounts due and
owing to IGT under the obligations described herein:
a. Borrower is a corporation duly organized and validly existing
under the laws of the State of Nevada and has all requisite power, authority and
legal right to execute and deliver this Agreement and any other document,
agreement or certificate to which it is a party, or to which it is bound in
connection herewith. Borrower has taken all necessary action to authorize the
execution, delivery and performance of this Agreement and of any other document
to which Borrower is a party or by which Borrower is bound in connection
herewith.
b. Neither this Agreement, nor any document to which Borrower is a
party (or by which Borrower is bound) in connection herewith is prevented by,
limited by, conflicts in any material respect with, or will result in a material
breach of, violation of, or a material default (with due notice or lapse of
time, or both) under, or the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of Borrower's property or assets
by virtue of the terms, conditions or provisions of: (i) any indenture, evidence
of indebtedness, loan or financing agreement, or other agreement or instrument
of whatever nature to which Borrower is a party or by which Borrower is bound,
or (ii) any provision of any existing law, rule, regulation, order, writ,
injunction or decree of any court or governmental authority to which Borrower is
subject.
c. This Agreement will constitute legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with its
terms.
d. All timely consents, approvals, orders or authorizations of, or
registrations, declarations, notices or filings with any governmental authority
(or judicial proceeding), which may be required in connection with the valid
execution and delivery of this Agreement and the performance of any of the
obligations hereunder have been obtained or accomplished, or will be obtained or
accomplished as and when due, or are in full force and effect.
20. Except as herein amended, the Note remains in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
CMS-EL CAPITAN, a Nevada corporation,
By: /s/ Xxxxxx Xxxxxx, Xx.
Its: Chief Executive Officer
"Borrower"
INTERNATIONAL GAME TECHNOLOGY,
a Nevada corporation,
By: /s/ G.Xxxxxx Xxxxx
Its: President
and Chief Operating Officer
"Lender"
AMENDMENT TO FIRST AMENDED AND
RESTATED UNSECURED PROMISSORY NOTE (REFINANCE)
THIS AGREEMENT is made as of the 5th day of November, 1999, by and between
CMS-EL CAPITAN, a Nevada corporation (the "Borrower"), and INTERNATIONAL GAME
TECHNOLOGY, a Nevada corporation (the "Lender").
W I T N E S S E T H:
WHEREAS, Borrower executed and delivered its First Amended And Restated
Unsecured Promissory Note (Refinance) to Xxxxx Fargo Bank, National Association
(as the successor by merger to First Interstate Bank of Nevada, N.A.) ("Xxxxx
Fargo Bank"), dated as of April 16, 1999, in the original principal amount of
$2,909,051.82, as amended by that certain First Amendment to First Amended And
Restated Unsecured Promissory Note (Refinance) dated October 26, 1999
(collectively, the "Note");
WHEREAS, Lender has acquired all of Xxxxx Fargo Bank's right, title and
interest in and to the Note and the loan evidenced thereby;
WHEREAS, there is presently due on account of the Note the principal sum
of $2,857,506.32 with interest paid to September 16, 1999; and
WHEREAS, Borrower and Lender desire to amend the terms of the Note as
hereinafter set forth.
NOW, THEREFORE, for valuable consideration, Borrower and Lender agree as
follows:
1. Any capitalized words or terms used but not otherwise defined herein
shall have the meanings given to such words or terms in the Note. All references
to "Lender" in the Note (except as provided in paragraph 5b below) shall be
deemed to refer to International Game Technology, a Nevada corporation.
2. Commencing on the date hereof (the "Interest Rate Adjustment Date"),
the rate of interest charged under the Note shall be adjusted to a floating rate
equal to the Prime Rate, as the same shall fluctuate from time to time, plus one
percent (1.00%) per annum. On the date which is twenty-four (24) months
following the Interest Rate Adjustment Date, the rate of interest charged under
the Note be adjusted to a floating rate equal to the Prime Rate, as the same
shall fluctuate from time to time, plus two percent (2.00%) per annum. All
references in the Note to the Note Rate shall mean the interest rate then in
effect computed in accordance with the preceding two (2) sentences.
3. The monthly payments of principal and interest under the Note are
hereby amended to the amount of Thirty-Six Thousand Dollars ($36,000.00)
commencing with the payment due on December 1, 1999, and continuing on the same
day of each month thereafter until the Maturity Date. Such payments shall be
applied first to accrued interest and then to principal.
4. The Maturity Date of the Note is hereby extended to December 31, 2008,
upon which date any balance of principal and accrued and unpaid interest shall
be paid in full.
5. Definitions. For the purposes hereof, the following words and terms
shall have the following meanings:
a. The definition of Executive Group in Paragraph 1 of the Note is
amended and restated in its entirety to mean a collective reference to Xxxxxx
Xxxxxx, Xx., E. Xxxxxxx Xxxxxx and Xxxxx Xxxxxxx, or their successors.
b. The definition of Prime Rate in Paragraph 1 of the Note is
amended to provide that each reference therein to "Lender" shall be deemed to
refer to Xxxxx Fargo Bank, National Association.
c. Paragraph 1 of the Note is amended to add the following
definition: "Deed of Trust" means that Deed of Trust and Security Agreement With
Assignment of Leases and Rents executed by Borrower, as debtor and trustor, of
even date herewith, for the benefit of Lender encumbering certain real property
and improvements located in Mineral County, Nevada ( the "Deed of Trust").
d. The term "Loan Documents" shall be deemed to include the Deed of
Trust.
6. Paragraph 2 of the Note entitled Guaranty is deleted in its entirety.
7. Paragraph 4 (b)(iii) of the Note is hereby amended to provide as
follows:
"(iii) as of the end of each Fiscal Year, commencing with the Fiscal
Year ending September 30, 2000, the Tangible Net Worth of the
Consolidation Group shall be at least Three Million Seven Hundred
Fifty Thousand Dollars ($3,750,000.00);"
8. Paragraph 4(b)(v)(i) of the Note is hereby amended to provide as
follows:
"(i) incur any Indebtedness other than liabilities incurred in the
ordinary course of business, purchase money obligations incurred for
the purpose of acquiring equipment in the ordinary course of
business (the "Acquired Equipment"), and obligations incurred in
connection with the construction of an RV Park in Hawthorne, Nevada,
and/or the expansion of the Silver Club Hotel & Casino; provided,
however, the lien of the Deed of Trust retains the same priority as
on the date hereof."
9. Paragraph 4 (b)(vii) of the Note is hereby amended to provide as
follows:
"(vii) during any time that an Event of Default has occurred and is
continuing, the aggregate compensation paid to the Executive Group
by the members of the Consolidation Group shall be limited to
$35,416.67 per month ($425,000.00 annualized) excluding health
insurance, life insurance and other benefits then existing;"
10. Paragraph 4 (b) (viii) of the Note is hereby amended to provide as
follows:
"(viii) no compensation (whether pursuant to wages, bonuses, draws,
salary, or other forms of compensation or advances on any of the
foregoing) shall be paid to The Holder Group, LLC, a Nevada limited
liability company, or to Xxxxxx X. Xxxxxx, Xx., by any member of the
Consolidation Group at any time when the Tangible Net Worth for the
Consolidation Group is less than Three Million Seven Hundred Fifty
Thousand Dollars ($3,750,000.00);"
11. Paragraph 4(b) of the Note is hereby amended by adding thereto the
following additional financial covenant:
"(ix) no members of the Consolidation Group shall make any loan to
officers, directors, stockholders or affiliates of Borrower,
including affiliates of The Holder Group, LLC, a Nevada limited
liability company, without the prior written consent of Lender. The
foregoing shall not restrict inter-company loans by and between
Summit Casinos-Nevada, Inc., a Nevada corporation ("Summit"), and
its subsidiaries."
12. Paragraph 5(a) of the Note is hereby amended to provide as follows:
"(a) Any representation or warranty made by Borrower in this Note
shall prove to be false or incorrect in any material respect as of
the date hereof, or shall hereafter become false or incorrect in any
material respect, or if Borrower shall breach any financial covenant
set forth in Paragraph 5(b) hereof (each a "breach"), and Borrower
shall fail to provide to Lender a written plan for correcting such
breach within thirty (30) days following notice from Lender of such
breach, which plan shall provide that such breach shall be cured
within ninety (90) days thereafter or Borrower fails to complete
cure of such breach within ninety (90) days following Lender's
notice. Such plan could provide for an equity infusion and/or debt
reduction to cure a breach of the financial covenant set forth in
Paragraph 4(b)(i) and/or 4(b)(iii), or could provide for a debt
reduction in an amount sufficient to reduce projected interest
expense over the succeeding twelve (12) month period to cure a
breach of the financial covenant set forth in Paragraph 4(b)(ii)."
13. Paragraph 5 of the Note is hereby amended to include the following
additional "Events of Default":
"(i) Any default by Silver Club, a Nevada corporation ("Silver
Club"), to make the Additional Payment (as defined in that certain
First Amended And Restated Promissory Note dated April 16, 1999, as
amended from time to time, made by Silver Club in favor of Xxxxx
Fargo Bank) when due.
(j) Any default by CMS International, a Nevada corporation ("CMS"),
to make the payment due at maturity under that certain CMS
Substituted Note dated September 30, 1993, in the original principal
amount of $2,560,981.05 made by CMS in favor of Lender.
(k) Any default by CMS to make the payment due at maturity under
that certain CMS Secured Promissory Note (Tax Note) dated July 1,
1994, in the original principal amount of $775,688.00 made by CMS in
favor of Lender."
14. Paragraph 6 of the Note is amended and restated in its entirety as
follows:
"6. Upon the occurrence of an Event of Default, the total of the
unpaid balance of principal and the then accrued unpaid interest
shall collectively commence accruing interest at the rate equal to
the daily Prime Rate plus three percent (3%), adjusted daily, until
such Event of Default is cured, at which time the interest rate
under this Note shall revert to the then applicable Note Rate."
15. Paragraph 9 of the Note is hereby deleted in its entirety.
16. The notice addresses set forth in paragraph 12(d) of the Note are
hereby amended to the following:
If to Borrower: Silver Club
P.O. Box 10750
Xxxx, Xxxxxx 00000
Attn: Xxxxx Xxxxxxx
Facsimile No. (000) 000-0000
If to Lender: International Game Technology
X.X. Xxx 00000
Xxxx, Xxxxxx 00000-0000
Attn: Xxxxxxx Xxxxxxxxx
Chief Financial Officer/
Vice President Finance
17. The Note is hereby amended by adding the following additional
provision thereto:
"12(m) Lender shall permit Summit to be "collapsed" (by means of a
merger, dissolution or similar reorganization) into CMS, with Summit
to be dissolved, and with any and all obligations, restrictions and
covenants relating to Summit set forth herein shall thereafter
relate to CMS."
18. Upon the execution of this Agreement, that certain Agreement dated
April 16, 1999, between Lender and Borrower relating to the Note (a copy of
which is attached hereto as Exhibit "A-1"), shall be deemed terminated and of no
further force or effect.
19. Borrower's obligations under this Note are secured by the Deed of
Trust.
20. To induce IGT to enter into this Agreement, Borrower makes the
following representations and warranties which shall be deemed to be continuing
representations and warranties until payment in full of all amounts due and
owing to IGT under the obligations described herein:
a. Borrower is a corporation duly organized and validly existing
under the laws of the State of Nevada and has all requisite power, authority and
legal right to execute and deliver this Agreement and any other document,
agreement or certificate to which it is a party, or to which it is bound in
connection herewith. Borrower has taken all necessary action to authorize the
execution, delivery and performance of this Agreement and of any other document
to which Borrower is a party or by which Borrower is bound in connection
herewith.
b. Neither this Agreement, nor any document to which Borrower is a
party (or by which Borrower is bound) in connection herewith is prevented by,
limited by, conflicts in any material respect with, or will result in a material
breach of, violation of, or a material default (with due notice or lapse of
time, or both) under, or the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of Borrower's property or assets
by virtue of the terms, conditions or provisions of: (i) any indenture, evidence
of indebtedness, loan or financing agreement, or other agreement or instrument
of whatever nature to which Borrower is a party or by which Borrower is bound,
or (ii) any provision of any existing law, rule, regulation, order, writ,
injunction or decree of any court or governmental authority to which Borrower is
subject.
c. This Agreement will constitute legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with its
terms.
d. All timely consents, approvals, orders or authorizations of, or
registrations, declarations, notices or filings with any governmental authority
(or judicial proceeding), which may be required in connection with the valid
execution and delivery of this Agreement and the performance of any of the
obligations hereunder have been obtained or accomplished, or will be obtained or
accomplished as and when due, or are in full force and effect.
21. Except as herein amended, the Note remains in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
CMS-EL CAPITAN, a Nevada corporation,
By: /s/ Xxxxxx Xxxxxx, Xx.
Its: Chief Executive Officer
"Borrower"
INTERNATIONAL GAME TECHNOLOGY,
a Nevada corporation,
By: /s/ G. Xxxxxx Xxxxx
Its: President
and Chief Operating Officer
"Lender"
